Bosses normalise annual leave policy as borders, society reopen

Singapore

THE extra-flexible leave policies of recent years appear to be one-off pandemic-era concessions, as human resources (HR) departments roll back rules on the carry-over and encashment of unused days.

"The more liberal approach in the treatment of annual leave over the last two years were dictated by circumstances," Sim Gim Guan, executive director of the Singapore National Employers Federation (SNEF), told The Business Times.

"As the Covid-19 situation improves, and as employees start to take leave for vacation, it is likely that employers would revert to their usual practices, and will send reminders to their employees to clear their annual leave."

Changes to annual leave policy in the public sector - which is Singapore's biggest employer, and a reference for some private firms - "are measures taken due to the unusual circumstances of the pandemic and do not represent a policy change towards an unlimited rollover of leave", a Public Service Division (PSD) spokesperson said.

The public sector usually allows unused annual leave to be carried forward only into the next year.

But BT previously reported that the civil service would let officers carry forward half their annual leave from 2019 into 2021, as well as to encash up to 9 days of leave.

Civil servants could also carry up to 9 days of unconsumed leave from 2020 into 2022, with the PSD spokesperson naming "the protracted involvement of public officers in Covid-19 operations in 2021" as the reason for the "one-time concession" made in the last 2 years.

BT understands that public-sector annual leave policies for 2022 have not yet been announced.

But private businesses are already moving to unwind some of the leave concessions made during the first 2 years of the pandemic, with HR executives pointing to the rollback of travel and domestic restrictions that had curtailed employees' ability to go on leave.

The return to pre-pandemic arrangements since 2021 is "in line with Singapore's move towards a 'new normal' of living with Covid-19", said Ernest Phang, head of corporate services for group HR at OCBC. The bank had allowed employees to carry forward 12 days of leave in 2020 - up from the usual 7 - or to encash up to 5 days. It returned to pre-Covid rules in 2021.

Meanwhile, UOB - which raised its leave rollover cap to 14 days in 2020 and 2021 - is reverting to the normal cap of 10 days this year.

Dean Tong, head of group HR, attributed the earlier concession to "the impact of Covid-19 on holiday plans and the need for many of our people to delay scheduled breaks", but told BT that the policy normalisation comes as "international travel is gradually resuming".

And insurer Allianz Asia Pacific let employees either encash up to half their unused leave in 2020 and 2021 - compared with none, pre-pandemic - or carry forward up to 14 days of leave, from 7 before.

But there have been no permanent changes to the leave policy, with staff now taking "reasonable levels of time off" as the travel situation normalises, regional chief HR and communications officer Wong Pi Ken confirmed in an e-mail to BT.

Among various concerns, Lewis Garrad, career business leader at consultancy Mercer Singapore, noted that leave policy adjustments have financial repercussions and may increase companies' staff costs amid trying times.

That's even as Wong told BT that "the additional costs of benefits to support our employees during the pandemic have been offset by strong business performance and productivity improvement" at Allianz, thanks to the adoption of digital technology and hybrid work.

But staff welfare is another concern for bosses. Liberal leave encashment and rollover policies could hit productivity and business performance, "as they are basically encouraging employees to work more with less break" and cause burnout, Garrad said.

Still, lasting changes may be an inevitable result of the pandemic.

Citi staff travelling for personal or family reasons can work from another country for up to 30 days, under a "cross-border remote work programme" introduced during the pandemic, which is still in effect.

That's although the bank's leave policy has returned to normal arrangements, after allowances for a longer leave deadline and higher rollover caps in 2019 and 2020.

The SNEF's Sim said: "With hybrid modes of working more common, employees may prefer flexible work to more annual leave. Employers should look into implementing flexible work arrangements, which can take various forms, to attract and retain talent."

Annual leave could also be enhanced by scheduled holiday office closures and/or enforced block leave, Mercer's Garrad suggested, while smaller businesses could let employees trade leave for flexible credits to take up benefits such as courses and health screenings.