How can you save money
when managing annual leave?

As a HR manager you may often face cost-efficiency issues. And you may find it hard to determine areas for improvement in your department since you’re dealing with humans and not goods. Well, annual leave management could be your first step, because some of the processes are costly and can be improved.

Calculate the time lost filling in and sending leave request forms...

Whether your leave sheets are on paper or Excel, your coworkers will take some time to fill them in. Once they have done so, they will either send them by email if it is an Excel file or hand-deliver them to their manager’s desk. Both of these actions take place during their working hours, meaning the longer it takes to request leave, the less time is spent on productive work. Now imagine how many times a year an employee makes a request and try to calculate how much productive working time is lost for the company as a whole – that should give you a rough idea.

… And the time lost by managers when planning their team presence

Not only does it take time for your coworkers to request leave, but summarizing them all is also time-consuming for managers. Of course, most teams can’t stop working because everybody is on vacation at the same time, so managers have to schedule each member’s leave in order to keep the company running. This also wastes a lot of time – even more so if employees forget to send in their leave requests before the deadline. Another side effect of this work method is that team presence isn’t known in other departments, meaning managers are often asked to account for it.

Watch out for errors caused by administrators

When it comes to annual leave management, the hardest point is exporting it correctly to your payroll software, a step which is crucial in a company’s operation. In general, administrators export once a month, but, if for some reason, between the export and the end of the month, an employee cancels or requests leave, the administrator must take it into account. And that’s when errors occur. If they forget to implement it in the next month, days off can be paid or granted twice. These kinds of errors are much more expensive than a simple matter of lost time so you need to be very careful with them.

Beware of wrongly cleared accounts

Depending of the nature of the days accrued and the country in which you work, days are not sorted in the same way. Some can be carried over, some are cashed in and some are simply lost. The end of the leave year represents a complicated period for administrators; they must be aware of the regulations for each country they operate in and pay or transfer the right amount of days. As above, such errors are counted in days and quickly become very expensive. Avoiding them is crucial.