With several different types of leave to keep track of, and with rules around paid time off (PTO) changing in some states, Excel spreadsheets and paper-based systems are no longer good enough for the job. Employers need a leave management system (LMS) that can track leave balances and field employee leave requests in real-time.
The right leave management software can simplify workflows, reduce human error, and automate key steps in the leave management process.
Let’s take a look at how leave management software works, along with the key benefits and features of a leave management system.
What Is a Leave Management System?
A leave management system refers to a piece of software that your HR department can use to track leave balances and approve or deny time-off requests. An effective leave management system can track vacation time, sick leave, and longer leaves such as medical leave under FMLA (the Family and Medical Leave Act).
If you’re a small business, you may already have a shared calendar or Slack channel that employees can use when they want to take time off work. But these systems are clunky to use and prone to human error.
A cloud-based leave management system can streamline the process, allowing you to comply with state leave laws and enforce company leave policies at the same time.
How Do Leave Management Systems Work?
Leave management systems work by providing a central platform that your HR team can use to field leave requests across your organization. Instead of having separate systems in place for each department, cloud-based leave management software is designed to simplify leave tracking with a standardized approval process.
A sample approval workflow might look something like this:
- An employee logs in to a self-service portal or mobile app to submit a leave request, with details on the length of leave and the type of leave.
- Your human resources team gets a real-time notification of the leave request, and can decide whether to approve it, deny it, or request documentation.
- The employee’s manager, co-workers, and other team members can view any approved leave requests on a central calendar (with any medical details kept confidential) in order to plan their schedule accordingly.
- The approved leave period will be reflected on their timesheet and submitted to the accounting department, reducing the risk of payroll errors.
Of course, the best leave management software is configurable so you can integrate it with your existing systems and align it with company policy. Although the focus of this article is on leave of absence tracking and PTO tracking, you can use similar tools for absence management and attendance management.
5 Benefits of a Leave Management System
Implementing a new LMS can cost time and money, but when done properly, it can save you time and money in the long run. Here are five ways that leave management tools can improve the employee experience and benefit your human resources team.
1. Reduce human error
Paper-based systems, and even spreadsheets, are prone to error. Managers can easily overlook a leave request that’s written on a calendar or sent in a Slack message. Plus, they can fail to notify the accounting department, resulting in payroll errors.
When you use leave management and time tracking software, you’ll have a centralized system that can send out real-time notifications when action is required.
2. Comply with employment law
Leave of absence requests may fall under FMLA, the Americans with Disabilities Act (ADA), and state employment law. States are increasingly implementing paid family leave programs and other paid time off (PTO) requirements.
Using a leave management system ensures that you track leave accruals appropriately, and keep a paper trail of the return to work and ADA interactive process.
3. Empower employees
Employees don’t want to fill out paper FMLA forms if they can help it. Employees can do their banking online, order lunch online, and do almost anything else online — and they want to be able to submit leave requests online too.
Choose HR software that employees can log into to view their leave balance, submit a leave of absence request, and upload supporting documentation on their own.
4. Centralize information
Having a centralized time-off management system provides greater visibility into work schedules across your organization. Team members can view each other’s scheduled absences so they can plan ahead to cover tasks or trade shifts accordingly.
Remember, you shouldn’t disclose personal medical information on shared calendars, but you can use general labels such as “Employee time off” or “Annual leave.”
5. Track metrics
Finally, the best leave management software enables you to track metrics and generate reports related to payroll, productivity, or absenteeism. You’ll be able to identify patterns in employee behavior, such as excessive leave requests or use of overtime.
5 Features to Look For in a Leave Management System
When choosing a leave management system, you’ll want to consider factors such as pricing, compatibility, and whether you’re facing any specific issues in the workplace, such as low staffing levels, high turnover, or absenteeism.
Here are the most important features to look for in a leave management system:
1. Cloud-based
Cloud-based software is a must, especially in the age of remote work and distributed teams. Employees should be able to submit their leave requests from anywhere, and your managers and HR team should be able to respond from anywhere too.
Plus, cloud-based software requires less infrastructure and maintenance than legacy systems do, allowing you to stay focused on your business priorities.
2. Customizable
While employment laws like FMLA apply in all 50 states, some states have their own paid leave policies and PTO regulations. Your company may also have its own leave policies that vary from one location or department to the next.
A customizable LMS can handle multiple types of leave, and account for state leave laws that apply to some employees but not others.
3. Automated
Automation is a key component of any leave management system. While you’ll need members of your HR team to handle complex cases, time-consuming tasks such as calculating leave balances can be handled automatically by your LMS.
Logic-driven workflows ensure that leave requests are processed appropriately, while automated notifications keep things moving forward in real-time.
4. Low- or no-code
One of the obstacles that HR teams face when designing a leave management system is the worry that they’ll need to develop it from scratch. But low- and no-code tools like Pulpstream make it easy for non-technical team members to replace legacy systems without having to hire an outside development team.
With an intuitive drag-and-drop interface, you can automate HR processes without having to write a single line of code.
5. Integrated
Another important feature is that your leave management system integrates well with other HR management software and time-tracking tools. If you can’t easily forward information from your LMS to your payroll department, then the convenience and accuracy of your leave management system will be reduced.
Fortunately, many leave management tools support APIs and other integrations with existing systems, helping you avoid interruptions and get rid of data silos.
Streamline Leave Management Without Having to Code
Leave management encompasses everything from balance tracking to attendance and absence management. A comprehensive leave management system allows you to field employee leave requests in line with company policy and employment regulations, and keep your team updated the entire time — from managers to payroll.
Pulpstream simplifies LoA management with a no-code, cloud-based platform that you can use to automate repetitive tasks and streamline your approval workflow.
Contact us today to request a demo and learn more!
