Leave Management and PTO are two important terms when it comes to employees. Taking time off work allows them to unwind and return to work with newfound energy. However, relaxation isn’t the only reason an employee asks for a leave – it could be an emergency too. Whatever the reason be for your employee to take a day off, absence and leave form an important part of the company’s payroll.
A leave tracker, also known as a vacation tracker or PTO tracker can be one of the best ways to oversee employee attendance. Today, we will also be looking at one such software that companies can use to optimize their HR functions in the sector in debate. But, before that, let’s discuss the challenges of the leave management system.
Challenges of Leave Management Processes
The HR department can find it hard to gather real-time data via manual paper processes. And even though managing PTO and leave seems to be an easy thing to do, many companies handle it rather negligently. Ignoring this process is a big mistake as it can harm your company’s productivity to a great extent.
The bigger the company, the more the employees. And the more the employees, the more traditional paper spreadsheets and forms pose a challenge while reviewing leaves.
These days, many businesses have considered and even invested in different software solutions to reduce their HR team’s stress. These tools help automate the lengthy tasks of leave management while significantly decreasing the chances of error.
Let’s look at the challenges of leave management process.
Keeping account of leave
Employees truly appreciate an employer who is flexible regarding taking time off work. While that’s convenient for the employees, line managers often struggle to keep track of who’s taking time off work and for how long. The fact that each employee has a different number of vacation days available further complicates the situation. Line managers must then keep track of the remaining days. Believe us, it’s much harder than it seems.
Leave request reviewing
If your company has many employees, your line managers will surely grow tired of reviewing multiple leave requests simultaneously. A lot of employees can submit their leave requests at the same time – for instance, a few weeks before a holiday. Some would send it in via email, some through a paper form, and others could verbally request their supervisor or manager for the PTO.
It goes without saying how hard this job could be on the managers to properly review every request. Adding to that is the incorrect submission of requests. Managers will be less efficient if they have to go through error-filled requests and lose track of pending ones in the middle, setting up the scene for an even bigger issue such as understaffing.
Due to such challenges, management would find it difficult to gather the necessary information to plan and implement decisions. Why is this important you ask? Because the right data gives the management a better estimate of the total picture.
Distorted data can confuse managers, making them make decisions that might not always be in the company’s best interests. Top management is convinced that manual mode of data collection is the most effective way, resulting in them losing interest and becoming discouraged in the responsibility. There are many possible negative implications of this for the company.
This is exactly why a PTO tracking software is necessary. In this digitized world, doing manual work only slows a company down, i.e., a competitive disadvantage.
Why Employees Don’t Take Leaves
The employees aren’t taking leaves and the management thinks that’s great. After all, more work is getting done in the office, right? While it may seem beneficial at first, it causes more harm in the long run. When an employee doesn’t take time off work, it accrues weeks, sometimes even years of leave. This is a major liability to the company because if an employee suddenly resigns, they would have to be paid in a lump sum. Unpaid leave gets registered as a debt in the company’s book and can cause a hindrance if you ever try to sell the company.
Listed below are two reasons why some employees prefer not taking leaves and risk burnout instead:
They want to seem dedicated: Many call it “office-martyrdom.” A handful of employees want to showcase their dedication and commitment to the job. An employer can resolve this issue by mentioning they value performance over 100% attendance. Let your employees know that they should take time off work so they can rejuvenate and get back with a fresh attitude.
They worry about the overwhelming work waiting for them upon return: Employees feel skeptical about leave benefits if they fear their employer will drown them in a sea of work after they return. You as an employer should converse with your employees on the first day of their return and provide a sense of direction for the future weeks.
Negative Implications of Poor Leave Management Process
Poor leave management can have multiple negative effects on the company and these are only some of the few:
Higher costs
Your company could be losing money thanks to inefficient leave and PTO management. In isolation, the cost of processing an employee’s updates and leave changes might appear as a small figure, but add that up and the sum will increase vigorously.
You also have to consider the cost of correcting employees’ or inspection errors in the manual system.
Disorganized staffing
When the leave management system does a sub-par job at giving the company insight into how many employees are available, the organization doesn’t have an accurate picture of how many employees can be spared for a particular task. You could approve leaves more than what your business can afford to handle at any given time.
In the end, it’s just the higher management panicking due to understaffing before an important project. On the other hand, some companies actually hire more people than required to ward off any possibilities of skill shortage. This phenomenon is termed overstaffing and is an additional cost.
Legal implications
Countries vary in their rules and regulations regarding leaves. If a leave management software is ineffective, you may unknowingly make decisions that are non-compliant with government standards. Companies have to pay fines when something like that is reported.
Any alterations to the law can be inputted into the system quickly. An employee leave tracker app automates the manual labor for supervisors and managers, allowing them more time to focus on critical issues at hand.
Decreased employee morale: Employees will not like it if their leave isn’t approved because your leave management process is inefficient and the policies are vague. Their morale takes a steady blow.
Low morale makes them lose interest in the work, not to mention the constant dissatisfaction. Subsequently, this increases employee turnover, generating increased costs due to hiring and training needs. An optimized leave management system helps managers systematically review and approve leaves while communicating the leave policies. In some cases, it can also auto-approve leaves.
Consider a coordinated leave management process as a bridge between you and your employees. It shows that a company truly values it, employees.
Problem with reconciling leaves
You shouldn’t depend on spreadsheets and registers for in- and out-time as attendance proof because this data can easily be tampered with. With manual systems, presenting proof gets difficult. Thus, if an employee starts arguing about their leaves, you won’t have enough material to point out their error.
Even small companies aren’t immune to these effects. You might think that it will be easy to remember how many leaves were taken by an employee but let us tell you, you are wildly underestimating how complex this factor can be. It can cause problems with additional leave approvals and payroll management in the long run.
Abusing sick leave
Sick leave is an essential benefit for the employees. However, due to a lack of proper management, many companies suffer from “sick leave abuse.” Not only does this cost a company a large sum of money, but this also decreases employee engagement in the organization. This brings us to the question: Why would employees resort to abusing sick leave?
If the employees realize that the leave management system of a company is flawed, they will try to take advantage of the poor condition. They actively violate the attendance policy. Two such examples of sick leave abuse are:
- Employee not informing their supervisor or manager that they will be taking a day off
- Employee not providing a medical certificate where required
Resource crunch in the time of need
At any time, if a company isn’t aware of how many employees they have on leave versus how many are available, a pending project deals with the damages. Keeping track of available human resources is crucial for managers – specifically when a deadline is looming over their heads.
Project delivery schedules are a good indicator of a company’s efficiency and punctuality. Meeting them on time strengthens company image.
Employee burnout and overtime: When you are poorly managing the leaves of 10 employees in your company, another 10 are forced to “pick up the pace.” Available employees may be asked to work double shifts, overtime shifts, and postpone any necessary vacation time they would request.
Overtime costs are a major concern for HR managers and business owners over the world, but employee wellbeing should definitely be the top concern. Employees who are constantly asked to cover extra shifts, work overtime, or quicken their pace because a company is running short on employees for a shift are more vulnerable to burnout. You run the risk of losing productivity as some of the better employees get less efficient over time.
Burnout isn’t a part of the job – that’s a common misconception used to normalize many toxic traits displayed by employers that forces the employees to distance themselves from their company. In reality, burnout is a result of a lack of support from the management, unmanageable workloads, nonsensical time pressure, unclear job description, and unfair treatment. This chronic problem has cost organizations productivity losses worth billions of dollars worldwide.
Burned-out employees tend to have lower productivity, higher absenteeism, and more disengaged. They may also call in sick more often. At the end of it all, they might also decide to quit.
How to Avoid the Risks
You can implement an efficient free time off tracker like Day Off to optimize the LMS. It’s time to bid adieu to spreadsheets!
Day Off is available in two versions – Basic and Pro. You can use the Basic version free of cost while you have to pay just $1 per user/month to get the Pro services. So, Day Off can be a great free vacation tracker for small businesses running on a budget.
Through the Day Off app, you can create a company profile for free and customize it. The HR dashboard makes it easier for the management to keep track of everything. All leave requests are directed to the right people. Managers can add different types of leaves and manage balances for each one. You can also make announcements and send invites via email and phone.
A few of the salient features of this unique time off app include:
- Unlimited employee database
- Customizable leave types
- Management reports
- Calendar view
- One-step approval.
For the Pro version, you get all that plus two-step approvals, the ability to create sub-teams and control calendars for those units, reset monthly balance, and more.
Final Thoughts
In conclusion, a solid, smooth leave management system can help the employees manage their time better, empower the management, and significantly improve employer-employee relationships. Proper initiatives from the company’s end can do wonders in preserving employee satisfaction. And an employee time off tracker is one of the best things an employer can do in this sector.