Can my employer deduct my earned leave for the holiday slowdown?

I remember the first time I encountered this situation while leading the HR function in a US based GCC in India.

My opposition to the company diktat to arbitrarily deduct earned leave got me "needs improvement" remark in my annual appraisal and a cold shoulder from the US Benefits leader for the rest of my tenure.

But I ensured no such action happened in the entirety of my tenure.

It reminded me of the incident when this query came to me as a response to my last post on Leave. While my short answer to the query is now part of the article header, there is are some interesting things to unpack here.

What is a Year end slowdown or Holiday Slowdown?

If you have worked in a US based company anywhere in the world, this is a common occurrence today. Companies realised early on that the last week of the year (Typically from 25th of December to the 2nd of January) is when hardly any work gets done.

So they came up with the brilliant idea of declaring a "Slowdown, ", a period where the company operates in minimal capacity and people go on a mandatory leave across all the geographic locations the company operates from.

Why is the deducting Earned Leave by employer for Holiday Slowdown an issue?

While no Labour law in India allows an employer to arbitrarily deduct leave from an employee's earned leave balance, such a move is problematic from an inclusivity and employee experience standpoint.

Think about it,

How inclusive is a company if it forces its employees to take a holiday that concentrates on a single religion in a multireligious country like India?

If you wake up one fine morning and find your earned leave balance being deducted without your consent, how would you feel?

Regardless of the origin of a firm, the law of the land it operates on supersedes any policies it may impose on its employees.?

Thus in India where employees are protected by central labour laws (The Factories Act 1948, Industrial Disputes Act 1947) and State Laws (The Karnataka Shops And Commercial Establishments Act, 1961) and without employee applying for a particular leave type the employer cannot deduct this leave balance.

And finally, the act of reducing Earned Leave balance that is otherwise can be encashed by the employee gets reduced by the employer.?

It risks portraying such an employer as a penny pincher interested in saving a few rupees using such a dubious mean.

Thus unless an employer wants to appear- non-inclusive, not an employee friendly place & a company that does not respect the laws of the land it operates on, arbitrarily deducting earned leave of your employee in the guise of a companywide "Holiday Slowdown" is a terrible idea

What can you do if your employer is forcing you on a Holiday Slowdown by forcibly deducting your leave?

There are a few things you can do.

a) Talk to your local HR team and document your concerns. Sharing this article can be a significant starting point, but even they will have to build a case with their Legal and compliance teams with their counterparts in HQ.

b) Suggest alternatives- If your company has a robust holiday management system and wants to be an inclusive, pro-employee one it can introduce concepts like "Restricted holidays" where multiple local region based holidays can be declared and employees can choose which ones they take

c) If the above points are not happening, or worse, you get retaliated upon for putting up this request, talk to your local Labour office to intervene.

As a site HR of a global company in a GCC in India, how can I help?

To balance the needs of your HQ and stakeholders in India can be a laborious task.?

As outlined in my intro example, by standing up for what is right and required as per the law of the land, you may incur retaliatory action (for which you are not protected in India, an article for another day)

And yet despite having the right intention of "one company, one policy" is important you protect the company from building practices that will damage the company reputation & trust in the long term.

Start by educating yourselves. Articles like this can be a good starting point. Buy handbooks of laws that apply to your unit and educate your counterparts in the US.

Document any discrepancy you see arising from Global policies that contravene local regulations on email with the right stakeholders.

Represent the voice of your employee and bring these issues to light of your management team whenever the opportunity presents itself.

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