All You Need to Know About HR Policies In India

All You Need to Know About HR Policies In India
Reading Time: 8 minutes

The primary motive of the HR policies is to ensure that the organization runs smoothly and achieves the goals of a company. The policies act like guidelines that set the rules and expectations for desired behaviour from employees as well as the organization as an employer. The human resource policies are supposed to protect the company from any type of legal trouble and also ensure that the employees get a healthy work environment.

 

An HR policy of a company also defines work culture and norms for how employees interact at their workplace. The HR policies in India have to be aligned with the local laws and regulations. Generally, the HR team defines the company’s HR policies, and they should also keep the values as a reference to ensure that the organization’s goals will be met. An HR policy is supposed to provide a framework to ensure getting high performance from the employees.

 

The human resource policies also define the obligations and rights of employees. HR policies are applicable to all the employees in the firm. The HR policies have to evolve constantly with the consistently changing environment. The ethical view on what should or should not be accepted in the workplace is evolving, and the organizations do the same for their policies.

 

In case of disputes, complaints, grievances or disagreements at the workplace, your HR policies can act as a guiding tool and help to find a solution. The HR policies lay a foundation for the code of conduct and ultimately shape the company culture. It also guides the work processes and defines strategies. The employees are obliged to follow the HR policies, and violating your HR policy can cause lower scores in performance management reports and even termination in extreme cases.

 
Also Read: What is the HR Induction Programme and Why is it Required?
 

How to Write HR Policies?

Making policies for a company is the responsibility of your HR team. The HR team has to consider the values of the company as well as the best practices according to present laws and regulations. The HR policies that are not compliant with government regulations can get a company in trouble. There have to be HR policies in the workplace that helps your firm to stay compliant with the government authorities, such as PF, minimum wages, anti-sexual harassment and much more.

  • HR policy in any company acts as a guidebook for various decisions and processes. Here are tips on how to write HR policies.
  • Write policies in a simple and easy-to-understand manner, and remember to avoid jargon.
  • The policy should be written in clear language without causing confusion.
  • An HR policy should apply to everyone in the company, including higher management.
  • It should include all rules and regulations.
  • The policy should also clearly state the repercussions in case employees break the rules.
  • The HR policies should be aligned with the company’s culture and brand reputation.
  • Before finalizing HR policies, you have a duty to ensure that HR policies for your company do not have errors or omissions.
  • HR policies must be flexible and adapt to major changes. The company’s HR policies and procedures are supposed to help improve productivity and should never be a hurdle for the work processes.
  • Following are some must-implement HR policies in India for better productivity and an ideal work environment for the employees.

 

Types of HR policies in India

There are primarily two types of HR policies in India, as described below.

 

Specific HR policies

These are the policies that are crafted to care for the specific needs of the department in the organization. These policies are closely designed for the achievement of organizational goals and higher productivity. The specific policies differ from company to company and are likely to be heavily influenced by the firm’s values. These include policies and procedures concerning salaries, benefits, quality of output and recruitment.

 

General HR policies

The general HR policies are necessary for guiding day-to-day activities and procedures. The leadership of the company generally formulation of HR policies. The general HR policies may include the ones that concern wages, work from home, maternity and paternity leave, provident fund, code of conduct and much more.

 

Let’s take a look at the policies and procedures that are essential for organizations.

 

Maternity and Paternity Leave policy

Maternity policy has to be designed in accordance with the maternity act by the government. The Maternity Benefits Act, 2017 applies to all organizations with more than ten employees. The act talks about the benefits and leaves that Under this law, women are eligible for 26 weeks of paid leave. The act is applicable to all women who worked for the organization for more than 80 days. If the company have more than 50 employees, they need to provide a crèche facility also.

 

The maternity leave policy is one of the most popular HR policies in India. According to this act, women should get at least 26 weeks of paid leave for the first two kids and 12 weeks of unpaid leave subsequently.

 

The government introduced Paternity Benefit Bill in 2017 while there is no legislation for paternity leave in India. This bill has received a great welcome for the steps it took towards equality. According to the bill, employees are eligible for 15 days of paternity leave to take care of their child and a new mother.

 

Sexual Harassment

Every organization must take action to make their workplace safe for women to work. It isn’t just a legal requirement but also a moral obligation. In India, laws have also been updated to make the safety of women in workplaces a priority. The major changes were driven by the Sexual Harassment Act 2013.

 

The act and the anti harassments policy at the workplace should provide protection to all women associated with the company. That does include full-time female employees, interns, part-time workers and any woman that visits the workplace as well as the female customers. The sexual harassment policy at work makes women feel safer and ensure that all complaints regarding the same get necessary action.

 

According to the act, all companies with more than 10 employees must have a robust anti-sexual harassment policy as well as an Internal Complaints Committee that aggressively takes action regarding all complaints they receive as soon as possible. The company must spread awareness about the policy to all the employees and build a work culture that provides all women with a fair and safe working environment. It should also encourage women to come forward to register a complaint if they are facing any issues.

 

The Code of Conduct

Companies’ code of conduct closely adheres to the vision, mission and ethics. These policies are to maintain a positive, productive work environment. It sets rules and guidelines for expected behaviour and discipline in the firm. Various rules are included in the code of conduct policies in India that employees need to follow. This is about general rules and regulations pertaining to dress code, internet and media policies, and conflict of interest policies and procedures.

 

The code of conduct-related policies should also include information about reporting a breach of the policies. There are rules under the policy that an employee must oblige to, such as arrival and work break, breastfeeding and much more. The Code of conduct in the company should also align with the regional laws and regulations.

 

Holidays and Leave Policy

The leave policy should give employees a clear idea of the leaves they are entitled to get at the organization. The policies must clearly mention the number of leaves employees are allowed to take annually. That include paid leave as well as unpaid leaves with a different type of leave such as sick leave, casual leave and more. The HR policies about leaves should also have guidelines for how to calculate the half day, deduction for unpaid leave and overtime.

 

India has 3 national public holidays, and organizations are not supposed to operate on those days without permission. There are few industries that have an exception to the rule and are allowed to operate on national holidays but have to give employees compensation for it under the Factories Act, 1948.

 

Provident Fund

The employee provident fund act of 1947 is about providing security to the person during retirement. The benefits include medical, pension, housing and more. It is applicable to all employers with more than 10 employees. Both employee and employer contribute a certain amount every month towards the provident fund. Employees like to have that security they get through the PF contribution, and it is the must-have policy from both in legal and employee perspective.
 

Also Read: How to claim PF Online? Step by Step Guide

 

Gratuity

The gratuity policy is aimed at showing appreciation for employees. The HR policies related to gratuity apply to employees who have been with the company longer than five years. It is a one-time payment and is also good for retaining employees for a longer period. The gratuity payment is made when an employee is resigning or being laid off. The gratuity policy should align with the payment of the Gratuity Act 1972. The company is obliged to pay gratuity, and the amount depends on the number of years the employee worked for.

 

Wages

Payroll is one of the important policies in the workplace. The compensation paid to the employees should adhere to government regulations such as the Minimum Wage Act of 1948. The act defines wages for both skilled and non-skilled workers. The minimum payment must be given to the workers to ensure that they can fulfil their needs.

 

The compensation offered to the employee also needs to be competitive to get people on board and retain them. All the payment and deductions that the company has to make to stay away from legal trouble also has to be part of the HR policies and procedures.

 
Also Read: New Wage Code 2022: How will it Impact your Payroll Processing?
 

Employment Termination

Many employees leave a company for various reasons. They might not see any further opportunities in their career, or the employer may find that they are not fit for the company anymore. In either case, there has to be a policy which defines some obligations to both employee and the employer.

 

The HR policy regarding employee termination has to include various requirements and rights that the employee is entitled to when they resign from their job. The policy should include all terms and conditions such as notice period, pending payments and the formalities as well as the transfer of responsibilities.

 

Work form Home

The work from home policy or flexible work policy is one of the most asked for after the Covid-19 pandemic. The way people work and how they manage their personal and professional responsibilities has changed drastically. People need more freedom over the time they choose to work in the location they wish to work from.

 

The policy should be designed to allow the employee necessary freedom and flexibility. The flexible work policy should also include the strategy for employee management and the rules that employees need to adhere to while working from a remote location. Every company must be ready with a good remote work policy. For top talent, the flexible work policy can be a decisive factor.

 

What are the HR Policies ‘Policies’ Benefits

HR policies set guidelines for the entire organization. Here are some benefits of having good human resource policies and procedures for a company.

  • During times of conflict or crisis, HR policies provide a quick guide for the decisions and actions that need to be taken.
  • HR policy of the company also provides an unbiased reference point in case of disputes or disagreements at the workplace
  • HR policies are the rule book and thus aid the decision-making in the organization. The company’s HR policies also ensure that personal feelings and biases are not taken into consideration while making workplace decisions.
  • HR policy also defines the importance of the employee in the company and let them know about their right, which makes them feel an important part of the company.
  • For organization processes to work smoothly, there has to be a certain framework that HR policies in your company define for you. It ensures ethical and rational behaviour is observed by the company’s staff.
  • The people-centric HR policies help the company to improve employee engagement and satisfaction. This, in turn, improves the productivity of the company in the long run.

 

Summary

HR policies in the company provide the necessary framework for the seamless flow of the processes in the organization. The HR policies have to act as a guidebook to resolve issues and decisions making. It’s important to make your policies employee-centric and follow the government law and regulations.

 

There are some HR policies that an employer abides by law and regulations by the local government. When a company designs an HR policy, it should make sure that it is simple to understand and is comprised of all the details concerning the matter.

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