People & Leadership

The ins and outs of leave management

South Africans are increasingly taking a strategic approach to annual leave. Due to the abundance of public holidays, it is possible to take minimal leave days and still get a significant chunk of time off.

For example, in April, by taking four days’ annual leave, you get eight consecutive days off. Thanks to Worker’s Day falling on a Sunday, and the holiday rolling over to the Monday, May offers the potential of a four-day weekend for a single day’s leave.

Now, in theory, this doesn’t sound all that bad, but in practice, it has the potential to become messy, real quick. This is because leave can be taken before the public holiday, after it, or even before and after it!

So, who’s in the office, when? And how many days are they gone for? And do they even have that much leave to start with? Also, are there enough people left in the office to cover all the bases that need to be covered?

This is why having a leave management system is so important.

What is leave management?

Leave management is the processes and systems that control the application, approval, and tracking of employee leave in a business. This includes getting approval from relevant decision-makers, running it through payroll, and updating the employee’s attendance record and leave balances.

Leave management systems should also alert you to situations that could affect your bottom line. For example, suppose too many people from a single department are on leave at the same time. In that case, you might need to hire contingency staff or negotiate a workable solution with your employees.

Why is leave management important?

Leave management is important because time is money.

Inconsistent leave policies can result in significant losses – of both money and people. Unplanned or poorly planned leave can lead to missed deadlines or targets, poor staff morale, and unhappy clients or customers.

Here are the top six reasons why having an automated leave management system will save you time, money, and admin-induced headaches.

  • Record keeping: Leave management systems maintain an auditable record of leave by automatically updating the values as leave is approved, declined, or accrued. Because paid leave is an employee benefit, it is the right of every employee to have access to their leave balances. Many HR solutions offer employees real-time, self-service access to their leave stats.
  • Legal compliance: It is essential that every business complies with payroll industry laws. Not only does leave management software reduce errors in leave reporting and payroll calculations, but it also updates automatically as tax and labour regulations change, enabling compliance.
  • Reporting/analytics: Leave management software tracks employee leave behaviour and can offer a holistic view of leave trends. This makes it easier to prepare and put contingency plans in place.
  • Plug revenue gaps: Having a record of leave in place means you will no longer lose money by paying for unapproved absences and uncompleted working hours. It also means that leave will be appropriately managed, and staff will no longer be able to accrue months of leave for which the business is liable to pay.
  • Reduce admin burden: Good leave management systems give employees self-service access to their leave balances and allow them to manage their time off electronically, providing transparency and a reduced admin burden for the business.
  • Employee wellbeing: Accurately managing leave will see employees enjoying their full leave entitlements, resulting in a better rested and more engaged workforce. And everyone knows that a happy workforce is a productive one.

What are the different types of leave?

There are various types of leave.

The leave cycle is determined by the type of leave and is either a specified period of employment with the same employer following the start of their employment or after the end of the previous annual leave cycle.

Leave is broken down into the following categories:

Annual leave

This is the leave you take when you need a break; it’s the time for holidays, rest, rejuvenation, and family time. The annual leave cycle is a 12-month period in which an employee is entitled, by agreement, to either:

  • 21 consecutive days’ annual leave,
  • One day of annual leave for every 17 days worked, or
  • One hour of annual leave for every 17 hours worked.

The employee is to receive full pay for annual leave days and can take accumulated leave on consecutive days (i.e., the employee might choose to take a month off in December and will “stockpile” leave until then).

Sick leave

This is the leave you take when you’re feeling under the weather, have had an accident, need a mental health day, or have a scheduled op that requires recovery time.

Sick leave works on a 36-month cycle, and an employee is entitled to a number of sick days equal to the number of days worked in a six-week cycle. However, if an employee has been with the company for six months or less, they are only entitled to one day of sick leave for every 26 days worked. (See why a leave management system is so important?)

Employees are usually required to bring a doctor’s note if their sick leave fell on a Monday or Friday or if they have taken more than two consecutive days off work.

Maternity leave

An employee is entitled to a minimum of four months (paid or unpaid) maternity leave, which may commence either four weeks before the anticipated date of birth or from when a doctor or midwife certifies that the mother is to take leave for the safety of herself or the baby.

Unless a doctor has certified that it is safe to do so, an employee may not return to work within six weeks after giving birth.

An employee who has a miscarriage or bears a stillborn child during the third trimester is entitled to six weeks of maternity leave following the miscarriage or stillbirth, regardless of whether the employee had begun maternity leave at the time of the miscarriage or stillbirth.

Employers are not obligated to offer paid maternity leave, in which case maternity benefits are determined according to the Unemployment Insurance Act (commonly known as UIF).

Parental leave

An employee who is a parent of a child is entitled to 10 consecutive days’ parental leave, commencing the day the child is born.

Adoption leave

Adoption leave applies to the adoption of a child under the age of two. A single adoptive parent is entitled to 10 consecutive weeks’ leave. If there are two adoptive parents, the other is entitled to 10 consecutive days’ normal parental leave. Leave can commence from the date the adoption order is granted.

Commissioning parental leave

Commissioning parental leave applies to surrogacy. The commissioning parent is entitled to 10 consecutive weeks’ leave. If there are two commissioning parents, the other parent is entitled to 10 consecutive days’ normal parental leave. In both cases, leave can commence the day the child is born.

Family responsibility leave

This leave is set aside for when an employee’s child is sick or when there has been a death in the immediate family. An employee is entitled to three days of paid family responsibility leave in each leave cycle. This type of leave cannot be accrued and will expire at the end of the annual cycle.

Choosing the right leave management system

It should now be clear that a manual leave management system is likely to set you up for failure. So, what now?

Having the right cloud HR and payroll system will transform the way you manage your employees’ leave (that means no more sticky notes lying around!). Your employees will feel empowered by having sight of their leave balances, and your business will be able to plan accurately thanks to transparent leave schedules and trend analytics.

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