Compensatory Off: Meaning & Rules For Comp Off

Companies value their team members who go the extra mile for the organization. Many employees perform overtime, on holidays, or during weekends, and they are compensated with compensatory offs by the organization. Comp offs are primarily introduced to make leave tracking and attendance management easier for HR managers, while providing flexibility for employees.

In this article, we’ll go over the definition of compensatory leaves, their rules and policies, types, and more.

What is Compensatory Off?

Compensatory off is a type of leave granted to employees who work on a holiday or a non-working day. It can also be provided for working overtime or a weekend, when they are usually not scheduled to undertake their work. Both the employees can measure the compensatory off using the HRMS software, while employers make a track using the system as well.

• Different scenarios can segregate compensatory off.
• During office closed
• The business is closed
• Public Holidays
• Overtime hours and etc.

But due to overtime, comp off is acquired differently. In most cases, it is accrued hour-by-hour means if one employee does one hour over time an hour of comp time can be accrued. An employee can take a day’s pay off by aggregating all the pay hours instead of the overtime pay amount.

To streamline the entire time of process, companies generally maintain some policies before accepting the comp off. Along with the other leave policies, the new joiners are also made aware of it during the orientation periods.

Policy for Compensatory Off(Comp off) for the Employee

To respect the compensatory off as per policy employees can not get more than 240 hours as Compensatory time. If in case an employee works overtime they can avail of either the comp off payment or time off. And moreover, if an employee takes a leave, they may take comp off instead of the leave at the very next day.

There are some common policies from the Government and some comp policies are varied from one company to another. Normally, the comp off expires after 60 days or 90 days.

In this section, we are discussing the policies of compensatory off in detail. So that it would be clear to the employees at they taking the compensatory off.

The Policy of Comp off

• Compensatory offs are only granted if the employees submit a written document to the higher authority to discharge some duty hours as comp offs. They have to submit the same written document to the acquisition specialist also.
• According to the policy compensatory off is sanctioned only if the employee has worked for extra 40 hours or more in the entire preceding week.
• If an employee work 3 to 4 more extra hours, they have to be paid with comp off amount or half-paid leave.
• If the employees have been asked to submit the report for work 2 hours or more before the regular working hours on a particular day, they can avail of half compensatory off.
• If an employee works on weekends between 2 to 5 hours they can avail of the half-compensatory off. In case he works more than 5 hours on holidays or weekends they can avail a full comp off easily.
• Compensatory off can easily be availed in the employee attending any team meeting or event during holidays.
• No compensatory off will be granted for attending the conference or seminar. When an employee takes a leave for the conference it would be taken as leave.
• Registration through a biometric machine calculates the working hours. Companies can use work tracking applications for detecting extra work hours. Otherwise, no compensatory is granted.
• In order to Comp- off policies, compensatory hours could be only valid for up to 30 days.

For example, if you work 4 hours extra on 20th April 2025, you can use those 4 hours before 20th August 2025 as compensatory leave) P.S. – Rules may vary from company to company).

Types of Compensatory Offs

If you like to segregate the comp-off into numerous types. You can find a variation depending on organizational policies and applicable labour laws.

1. Overtime Compensatory Off

When employees do work overtime hours. It would be counted as the Overtime comp-offs. As per the policy, they can avail of a minimum of half day to full day off with respect to working hours. The additional hours worked are typically converted into equivalent time off or payment options.

2. Holiday Compensatory Off

Often Employees work on holidays on behalf of the company. It is granted as a holiday compensatory. It allows the employees to take time offs on different days or carry forward to next year.

3. Weekend Compensatory Off

Often employees have to work on weekends. They can avail the compensatory off to balance their work schedule. They can get the holiday any day prior to the working weekend or they enjoy an equivalent day off during the regular workweek may be granted.

4. On-Call Compensatory Off

Some organizations have on-call arrangements where employees have to work double shifts due to some emergency, outside their regular working hours. In such cases, compensatory off may be provided to balance the additional time spent on-call.

5. Travel Compensatory Off

Employees require to travel to our station due to some work urgency or urgent meeting. Organizations should pay as comp-off compensation for the time spent travelling. Employees can take time off for a day also.

6. Compensatory Off for Emergency Situations

In certain situations, such as during a crisis or emergency, employees may be required to work additional hours or be on duty continuously. Paid time off can be provided to ensure they have time to rest and recover from the demanding circumstances.

How to Draft Your Compensatory Leave-Offs(Comp off)?

Before finalizing the compensatory off policy for employees, it is essential to arrange the company policy based on the comp-offs besides the government rules and regulations.

At the time of drafting the compensatory off policies, they should maintain some rules. It helps them to structurize the entire policies and implement them in the organization.

When drafting compensatory leave policies, public companies must meet additional criteria. For instance, the organisation and the association must agree to the compensatory time policy if a union is included.

Otherwise, the compensatory time policy must be agreed to before the overtime hours, not after they have been worked.

➔ Eligibility of taking Offs

First, you have to decide who qualifies for the compensatory offs. Identify the existing legal limitation for the employees.

Those workers who have already worked more than 40 hours a week, avail to receive compensatory time off or extra payment for overtime.

➔ Clarified Calculation

Extra payment or time off should be calculatable always. There should be a clarification on whether you pay at an hourly rate or a monthly rate. There is another concern that the extra hours should be properly countable.

You can use any time tracking system for counting the extra hours and optimize any right performance tracking software for genuine performance tracking.

➔ Parameters

Set some terms and policies of how to utilize the compensatory off. It must be specified what will be the limit of taking compensatory off or what would be the limit of hours of taking compensatory time off and more.

➔ Training and Development

Before implementing the policy, it is important to be properly trained in it. So that you can reach the goal within the legal parameters of the jurisdiction. Before submission, it is essential to record the comp-off policy and go through legal assistance.

How to Calculate Compensatory OFF?

The policy you create will significantly impact how compensatory leave is determined.

Public Agencies

In public agencies, public sector employees work for the central or state administrations. They avail the compensatory time at the rate of 1.5 times the overtime hours.

Private Companies

In the case of Private companies, there are certain policies based on company to company. Companies have the option to choose how they will compensate their fellow employees. Even employees are not eligible for the comp-off if they are not up to the mark of the mentioned policies by the organization.

End Note

Tracking the components and leaves for the entire workforce might be challenging for HR management. A dedicated solution like a leave management system can help you streamline operations correctly and bring data to one place.

Pocket HRMS is a new-age HR solution. Intuitive modules like online payroll software and an advanced attendance management system provide a cutting edge to HR professionals and management. Interested in our HRMS solution? Book a FREE demo today!

Write to us at sales@pockethrms.com for the best details!