22 Most Important HR Policies in India 2024
It is the sole responsibility of the HR personnel to keep a company compliant to the local laws of a country. Therefore, the company policies should be created with the utmost understanding and experience. Below, we’ve included a list of 12 important HR policies that your company must have in India. The list is no particular order of importance.
1. Employment Contracts
An employment Contract is an accord that states the working relationship between an employee and a company. It allows both parties to understand the rules and regulations and the terms of employment.
It is important to have these documents as the Indian employment laws are a diverse and complex framework to navigate. Therefore, having up to date documents to prove the company’s compliances will protect the company for several years ahead.
A few important laws that you must refer to before creating the company’s employment contracts are wage laws, labour laws, the contract act, 1872 and the local state’s employment laws.
2. Code of Conduct
The code of conduct policy of a company contains the vision, ethics and mission of the organization and also, and It is created to build and maintain the right business environment for employees. It contains the rules of work that the employees of the company much abide by.
In India, policies such as equal right policies, electronic usage policy, dress code, enabling work environments, media policy, conflict of interest, etc are included in the code of conduct policy.
Furthermore, the code of conduct must include the procedure to report a breach of the code of conduct.
3. Employee Wages
Managing employee payroll is an important part of an HR department’s job, however, ensuring that employee salaries are competitive in the market and are compliant with government policies is also an important part of it.
In India, several acts cover the wages of an employee. One of them is the Minimum wage act, 1948. and also, It sets the minimum wages that a skilled and unskilled labourer should receive. As well as It enables employees to earn the ‘basic cost of living’.
Furthermore, the Payment of Wages Act, 1936 ensures that the employee receives the right monthly payment on time and without any unnecessary deductions.
Therefore, it may be tempting to only focus on the competitive market rates, however, it is important to pay heed to the compliances required for every employee’s wages.
4. Menstrual Leave Policy
Menstrual leave is a leave where women may have the option to go for a paid or unpaid leave from their employment if they are on their periods and are unable to go to work because of the pain and anything related. This leave helps to seek better facilities for women in the workplace. and because of this women have always suffered.
And to ease up things, Menstruation Benefits Bill 2017, was introduced by Ninong Ering who is a member of the parliament of Arunachal Pradesh. Under the Bill, women of both public and private sectors registered with the Central and/or state governments will be entitled to two days of menstrual leave every month, amounting to a total of 24 days of leave annually.
The leave mentioned in the policy shall be provided to each and every woman without fail and no discrimination should be done on the basis of the work they do.
5. Gratuity Policy
A gratuity amount is payable to an employee if they have completed 5 years of employment in a company. Once an employee is retired they receive their gratuity amount, this amount is mainly paid to an employee to offer them a token of appreciation for the service they have delivered to the company. Furthermore, It is also a legal compulsion to pay employees gratuity under the payment of gratuity act, 1972.
Therefore, you must have a gratuity policy in order for your organization.
6. Employee Provident Fund
The employees’ provident fund act, 1947 provides employees with income security during their retirement also, It is a social security fund that gives employees benefits like retirement pension, medical insurance, housing care and more.
It is worth noting that only organisations with more than 10 employees have to compulsorily have a Provident fund.
However, you should have a provident fund policy in your organization to make things easier.
7. Leave Policy
The leave policy is created to give employees a clear picture of the number of leaves an employee is allowed to take annually. Furthermore, it should also mention public holidays. Furthermore, the leave policy must also mention the percentage of salary cut that an employee will see in the case of unpaid leaves or half-days.
Legally, India has three national holidays where no organization is allowed to be open without permission. However, organizations like factories, hospitals, travel agencies, etc are exempt from this and are allowed to work for 24 hours a day. However, under the Factories Act, 1948, they must be paid for those days and should be paid for overtime.
Furthermore, every organisation should have an annual list of leaves that the employees will be getting.
