The roadmap for employers to efficiently organise public holidays in India

In India, the number of public holidays that employees get off is not as clearly defined as in most European countries. So, when is your Indian staff entitled to a day off? Our expert Suhasini Sharma gives tips on how to organise your calendar as clearly as possible.

Diwali is one of the most important holidays in India

Holidays in India

In India, the number of paid days off that an employee can take is divided into 3 categories: 

• Earned leave - average of 12 days per year

• Casual leave (unscheduled) - 7 days per year on average

• Sick leave - average of 12-14 days per year

The minimum number of leave days that a company in India is required to provide to its employees depends on the state in which the company is located. While we have mentioned above the averages for each category of leave, this minimum varies from one Indian state to another and you cannot simply copy HR policies from other countries or even other Indian states. You should always check whether your policy complies with local regulations. Help from local experts is not an unnecessary luxury. 

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Suhasini Sharma

Growth Consultant

Suhasini Sharma has over 19 years of experience as a Business Intelligence Specialist and Customer Success & Growth Manager. As a Growth Consultant, she maximizes value for our clients' success by providing them with customized solutions, insights and guidance.

Her focus is cross-cultural collaboration, business development, strategy and Customer Relationship Management.

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Earned leave

"Earned leave, as the name suggests, is a form of leave that is earned by employees. On average, an employee gets 1 day of leave for every month that he or she works in your company," Suhasini explains. "The condition for taking these leave days varies from company to company, but normally 15 days notice must be given. Earned leave days are deductible if they are not taken. It depends on the employer whether the settlement of outstanding earned leave days takes place at the end of each year or at the end of the employment. In the latter case, the unused leave days can thus be carried over to the following year - the maximum carry-over is 30 - but it is not mandatory for employers to offer this possibility." 

Unscheduled leave

Unscheduled leave are days that can be taken by the employee just before the leave or on the day itself. "These are unexpected circumstances that result in the employee not being able to turn up at the office, such as a sick child suddenly being at home or, a very Indian problem, extreme weather and consequent huge traffic jams," says Suhasini. "Most employers do choose to limit the number of unscheduled leave days that can be taken consecutively, in many cases a person can take a maximum of two or three days of unscheduled leave in a row."

Sick leave

Sick leave can be taken for 1 or 2 days in a row, if an employee is sick for a longer period, he or she must be able to present a doctor's certificate. 

Roadmap to smartly organise public holidays in India

India has 3 public holidays on which all businesses have to close:

• Republic day - 26 January

• Independence Day - 15 August

• Gandhi Jayanti - 2 October

In addition to these three mandatory days off, dozens of public holidays are celebrated in India. When determining the number of public holidays your employees get off, it is important to check whether you are compliant with local regulations. All Indian states have set basic rules on this. Generally, a minimum of between 8 to 14 public holidays are given, depending on the state. This includes the three national holidays mentioned above and gives employers and employees the freedom to choose the other holidays themselves.

"In India, dozens of religious and regional holidays are celebrated, most of which are determined by the lunar calendar," says Suhasini. "This means that public holidays fall on a different day every year, so you have to be flexible with your planning. In addition, employers in India often have to deal with a diverse workforce that professes different religions and thus want to take time off at different times. Organising this can feel like a challenge, but there are smart ways to tackle it." 

This step-by-step plan will ensure that you organise your holidays as inclusively and efficiently as possible:

1. Legal guidelines

The number of public holidays you need to take off depends very much on your location. Therefore, it is important to be aware of the holidays that your state government gives off. Every year, around October/November, Indian states publish their list in local or national newspapers. The number of public holidays that companies have to give off is also announced. This number varies from 8 to 14 days per year, depending on your location. Therefore, if you operate in several states, the number of days off may vary between your locations.

2. What are other companies doing in your area?

Apart from being aware of local regulations regarding public holidays, India also has regional holidays and, due to the use of the lunar calendar, national holidays fall on a different date in different locations. It is therefore smart to check which public holidays the companies in your region have released in recent years. This will give you a good benchmark of the most important public holidays in your state.

3. Demographic data of your employees and customers

As the holidays are important times for employees to celebrate and get together with their families, the demographics of your employees are important in determining the days you give off. Map this out and don't forget to look at your clientele. If you have many international clients, they will probably want a clear overview of the days when the office is closed or when some of the staff is absent. This could mean less flexibility for your employees. If you have many Indian clients, both in and outside your state, then you should also take into account the holidays that are relevant to them.

4. Choose a flexible or fixed approach

There are two ways to approach the release of public holidays, with a flexible or fixed list. If you opt for a flexible approach, you offer your staff the chance to take holidays that are important to them. Here's an example:

• Your company is required by the guidelines to offer 10 public holidays and you have a very diverse workforce. You therefore choose to give the entire office time off during the 4 biggest and most important public holidays in India (though this will of course depend on your staff demographics), which are Diwali, Eid, Christmas and Vaisakhi (an important holiday in both Sikhism and Hinduism), and the 3 national holidays. For the other 3 days, your employees can choose on which time they would prefer to have time off by submitting these days to you. These are called non-standard holidays because not every employee, but only a specific group will have this day off. 

This approach is becoming increasingly popular in India as it is the most inclusive. But for companies with a large workforce or international customers, this can be difficult to implement. In this case, you can also choose to compile a list of public holidays yourself, based on regional rules and preferences, and share it with your employees and customers. 

"If you are in doubt about which holidays to include in your policy, it is good to know that Indians do not mind taking an unscheduled or earned day off for a holiday that is important to them," says Suhasini. "I'm not talking about an important festival like Diwali - you won't be able to get an Indian to the office on that day - but about lesser celebrated days. Moreover, it is not customary in India to be paid twice if an employee has to work on a public holiday; instead, this is compensated for by offering extra days off at a later date when needed, a so-called compensatory leave. These days off are similar to earned leave and can therefore be taken or credited."

The guide for employers in India

Finding, hiring and retaining staff in India, whether remote or as part of your entity, involves a lot. You have to deal with new challenges during recruitment, different rules regarding contracts and differences in the work culture. To make it all a bit clearer for you as a European employer, IndiaConnected has created a special guide with advice for every challenge you may face.

Joint venture is the key to success for Flemish bio-energy plant builder Vyncke

For many years, India was a fly-over country for Peter Vyncke, who runs the Flemish family business Vyncke together with his brother Dieter. "Before my brother and I took the helm, I was in charge of Vyncke's Asian department in Kuala Lumpur, Malaysia. At the time, we were fully focused on South-East and North Asia, India was not in our sights. Until I suddenly lost an important order from an existing Malaysian customer to an Indian competitor. There was only one right strategy for that, fight them on their own turf."

CEO Peter Vyncke and his son Gilles during a traditional first-fire of a ForbesVyncke power plant

A biomass energy plant of the Belgian-Indian joint venture ForbesVyncke

Peters great grandfather, as the Flemish CEO likes to describe it, came up with the ingenious idea of converting coal-fired boilers into biomass boilers 100 years before the Kyoto treaty. "Those first Vyncke boilers were fired with waste from the flax industry, but now they can be used in almost any sector. We can convert all kinds of waste products into energy, from cocoa shells to wood chips." Vyncke's energy plants therefore sell well in countries around the equator, where large industries produce more organic residual waste, such as the coffee or palm industries.

Belgian company Vyncke has been active in Asia for more than 40 years, but only ventured into the Indian market ten years ago. "From 1996 to 2000, I managed the Asia branch of Vyncke from Kuala Lumpur," says the Vyncke top executive. "We were mainly focusing on China and the south-east of the continent and not at all on India. Then suddenly, one of my major Malaysian customers was snatched up by a competitor from India. That made me realise that I had to look into the country. Not only to see what opportunities there were for us, but also to start making life difficult for that competitor on its own territory."

Joint venture with Forbes Marshall

As the idea of starting up in India began to bubble up at Vynckeneers, Vyncke received a special visit in Belgium. "My father travelled all over the world for Vyncke and on one of those trips he ended up in Pune, at the Indian company Forbes Marshall. He had left a message in the guestbook there. To our surprise, 25 years later, a Forbes Marshall employee suddenly turned up on our doorstep with a copy of that guest book entry in his hand." The Indian company specialises in process efficiency and energy saving for industry and at the time was looking for a partner to conquer the biomass market in India with. "They just didn't have the technical knowledge and that's how they ended up with us, says the Vyncke director. "We immediately had a very good click. Forbes Marshall is run by two brothers, and we are also two brothers at the helm of Vyncke. We have the same attitude in how we do business, you can't do business without a bit of fun. In addition, we complement each other perfectly in terms of knowledge: we the technical knowledge, they the knowledge of the Indian market."

The companies therefore decided to formally establish the joint venture ForbesVyncke in 2010. "That was the best way for us to enter the Indian market. We could certainly have done it on our own with our experience, but it would have taken us much longer to get up and running," explains the Belgian CEO. "Forbes Marshall took charge of setting up the company and immediately put his best people forward. As a result, we got off to a flying start. Within two years we were already in every corner of the country, selling only to premium customers at about 20-30% higher prices than our competitors. We now have an annual turnover of around 20 million euros."

Give each other space in the cooperation

Peter advises any company considering starting up in India to find a good partner. "When companies say they want to start up on their own, I always ask, 'Are you really sure?' India is a country of 1.3 billion people and the bureaucracy is a maze". Working with a partner who knows the market and the way it works takes away a lot of start-up problems. "Our partner is responsible for the operations of the joint venture, so everything from sales and HR to legal is in their hands. This allows us to concentrate on our core business, the technology of the product. Because we both focus on our strengths within the joint venture, the company runs like clockwork, says Vyncke. "If you opt for such a construction, you must not micro-manage matters that are outside your remit. Give the other person the space and confidence to fill in the framework that you draw up together, as you see fit. Nobody in India is waiting for a Western company to come and tell them what to do, like some kind of colonialist."

Don't sell it as green, but for the money".

According to Peter, the advice not to be pedantic as a foreign company in India also applies to the product you market. "Take our product, for example, which is being used by companies in Europe for its higher morals. Namely because it replaces fossil fuels and is CO2 neutral. But in India, that is not the motive at all. There, it helps companies enormously in terms of costs, to be able to make energy from the residual products they have left over." Biomass is a lot cheaper than oil or gas in a country like India. India is therefore also one of the few countries in the world where more than 70% of the population depends on biomass for its energy needs. "So you shouldn't market such a product with a pedantic tone, because it is better for the environment. For India, it is a cheaper solution for the country's energy needs. Don't sell it as green, but for the money."

ForbesVyncke has had its biomass power plants heavily adapted to the needs of the local Indian market. "The standard in India is still different, even with the international companies we work with," Peter explains. "While in Europe the operation is fully automated, in India they are not prepared to pay extra for it. The labour costs are still lower than the costs they would have to invest for a fully automated installation. As a company, you have to take that into account and not look down on it." The CEO therefore advises any start-up company in India not to start with too big expectations and strategies. "Growing in the Indian market takes time. Stay close to yourself, your product and find a good partner! We really have the best partner in the world. Because of that partnership, we have now left that Indian company, which woke me up 20 years ago by hijacking my Malaysian client, far behind."

Indian ambassador offers help to Dutch business community

The new Indian Ambassador to the Netherlands, Venu Rajamony, is strongly committed to helping the Dutch business community in India. According to Rajamony, this is not only important for India. "Dutch companies cannot afford to ignore India."

The staff of the Indian Embassy in The Hague (Photo: Indian Embassy)

India's new ambassador to the Netherlands, Venu Rajamony, has not been idle during his first three months in the country. His new job in The Hague got off to a flying start with the long-awaited state visit of Indian Prime Minister Narendra Modi in June. At the end of August, Rajamony welcomed India's Food Processing Minister, Harsimrat Badal, and in September two more incoming Indian trade delegations awaited.

Promoting trade and attracting Dutch investors is Rajamony's main mission in the Netherlands. "The diplomatic relationship between India and the Netherlands is good. A lot is already happening in the economic field, but given the huge potential, much more can be done." Rajamony stresses that both countries have an interest in doing so. "Of course, India can use Dutch expertise in areas such as agriculture, water and waste very well, but at the same time, Dutch companies cannot afford to ignore India. We are the fastest growing major economy in the world with a young population and a growing middle class."

Where I can help Dutch companies, I try to do so.

MoU signing during Prime Minister Modi's visit to the Netherlands (photo: Indian Embassy)

The Indian ambassador is determined to assist the Dutch business community in their market entry and growth in India. For example, the top Dutch managers who attended the consultations between Rutte and Modi in June have all received an invitation for a personal meeting. While listing the companies (Boskalis, Philips, Rabobank, Rijk Zwaan, Vopak...), Rajamony suddenly reaches for his phone. "I now remember that I was going to make a request in Delhi on behalf of a Dutch company - let's not mention their name. Where I can help, I try."

That offer applies not only to companies already operating in India and encountering a barrier, but also to newcomers. "We are happy to help companies find good Indian partners and simplify the bureaucratic process for their market entry as much as possible." For companies looking to win contracts from the Indian government, Rajamony has some advice. "To stand a chance, it helps if Dutch parties work together with an Indian partner. In addition, companies increase their chances if they produce part of their technology in India, use Indian raw materials and hire Indian staff. This is not only in line with various government objectives, but also reduces their cost price. Dutch companies need to realise that India is a highly competitive market where companies from all over the world compete for tenders." 

Look at Dutch companies that have been operating in India for a long time: they are all doing good business.

Rajamony also advises companies not to get discouraged too quickly. "Look at Dutch companies that have been active in India for a long time. Of course, they too had to overcome obstacles in the beginning, but now they are all doing good business. Competitive Dutch companies that enter India now will also benefit in the long run from the huge market, the rapidly growing middle class and the abundance of young, qualified people."

Moreover, the Indian government is not sitting still in the meantime, the ambassador emphasises. "With Make in India, Digital India, Invest India and 100 Smart Cities, among others, we are moving in the right direction. India's growth is clearly different from China's: our economic growth is driven by domestic consumption, not by exports. This makes India's growth future-proof: we are less dependent on the global economy."

Ambassador Venu Rajamony (Photo: Indian Embassy)

Personal

Venu Rajamony (56) started his career in 1983 as a court reporter with the Indian daily The Indian Express. After three years he exchanged journalism for the Indian Ministry of Foreign Affairs. As a diplomat, he worked in Washington, Beijing (Rajamony speaks fluent Mandarin), Dubai and Geneva, among other places. Until this summer he worked as a spokesman for Indian President Mukherjee. Rajamony lives in the Indian House in Wassenaar with his wife. Rajamony has two grown-up sons: the eldest works in New York, the youngest is studying in Delhi.