Crucial Elements of a Successful Leave Management System: What You Need to Know

With several different types of leave to manage and paid time off (PTO) rules changing in some states, Excel spreadsheets and paper-based systems are no longer sufficient. Employers need a leave management system (LMS) that allows them to track leave balances and process employee leave requests in real time.

The right vacation management software can simplify workflows, reduce human errors, and automate important steps in the vacation management process.

Let’s take a look at how vacation management software works, as well as the key benefits and features of a vacation management system.

What is a vacation management system?

A vacation management system is software that allows your HR department to track vacation balances and approve or reject time off requests. An effective leave management system can manage vacation and sick leave, as well as extended leaves of absence, e.g. as part of the FMLA (Family and Medical Leave Act).

If you're a small business, you may already have a shared calendar or Slack channel that your employees can use when they want to take a break from work. But these systems are cumbersome to use and prone to human error.

A cloud-based vacation management system like IceHrm can streamline the process and allows you to comply with state vacation laws while enforcing company vacation policies.

How do vacation management systems work?

Leave management systems provide a central platform through which your HR team can process leave requests within your company. Instead of setting up a separate system for each department, cloud-based leave management software simplifies leave tracking with a standardized approval process.

An example approval workflow might look something like this:

1. An employee logs into a self-service portal or mobile app to submit a vacation request with information about the length and type of vacation.
2. Your HR department receives real-time notification of the leave request and can decide whether to approve it, reject it, or request documentation.
3. The employee's manager, colleagues and other team members can view all approved leave requests in a central calendar (keeping all medical details confidential) to plan their schedule accordingly.
4. The approved vacation period is reflected on the timesheet and forwarded to accounting, reducing the risk of errors in payroll.

Of course, the best vacation management software is configurable so you can integrate it into your existing systems and align it with company policies. Although the focus of this article is on tracking absence and PTO, you can use similar tools for managing absence and attendance.

5 benefits of a vacation management system

Implementing a new LMS can take time and money, but if done right, it can save you time and money in the long run. Below are five ways absence management tools can improve your employees' experiences and benefit your HR team.

1. Reduce human error

Paper-based systems and even spreadsheets are prone to errors. Managers can easily miss a vacation request written on a calendar or sent in a Slack message. Additionally, they may fail to inform accounting, leading to payroll errors.

When you use vacation management and time tracking software, you have a centralized system that can send real-time notifications when action is needed.

2. Comply with labor law

Leave requests may be covered under the FMLA, the Americans with Disabilities Act (ADA), and state employment law. States are increasingly implementing paid family leave programs and other paid time off requirements.

Using a leave management system ensures that you adequately track accrued leave days and document the return-to-work and ADA interaction process on paper.

3. Empowering employees

Employees don't want to fill out paper FMLA forms if they can avoid it. Employees can do their banking online, order their lunch online, and do almost everything else online - and they also want to be able to submit vacation requests online.

Choose HR software that employees can log in to view their vacation balance, submit an absence request and upload the relevant documents themselves.

4. Centralize information

A centralized vacation management system provides a better overview of working hours in your company. Team members can see each other's planned absences so they can plan ahead to take on tasks or swap shifts.

Remember that you shouldn't disclose personal medical information on shared calendars, but you can use general terms like "employee time off" or "annual leave."

5. Track metrics

The best vacation management software allows you to track metrics and generate reports on payroll, productivity, or absenteeism. This allows you to recognize patterns in your employees' behavior, such as: excessive vacation requests or the use of overtime.

5 Features to Look for in a Vacation Management System

When choosing a leave management system, you should consider factors such as price, compatibility, and whether you face specific workplace issues such as: E.g. low staffing levels, high fluctuation or absenteeism.

Below are the key features to look for in a vacation 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 vacation requests from anywhere, and your managers and HR team should also be able to respond from anywhere.

Additionally, cloud-based software requires less infrastructure and maintenance than legacy systems, allowing you to focus 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 requirements. Your company may also have its own vacation policies that vary from location to location or department to department.

An adaptable LMS can manage multiple types of leave and accommodate state leave laws that apply to some employees but not others.

3. Automated

Automation is a key component of any vacation management system. Although you need employees from your HR department to handle complex cases, time-consuming tasks such as calculating vacation balances can be handled automatically by your LMS.

Logic-driven workflows ensure vacation requests are processed properly, while automated notifications keep things moving forward in real time.

4. Little or no code

One of the obstacles HR teams face when developing a leave management system is the worry that they will have to develop it from scratch. However, low- and no-code tools like IceHrm allow non-technical team members to replace legacy systems without having to hire an external development team.

With an intuitive drag-and-drop interface, you can automate HR processes without writing a single line of code.

5. Integrated

Another important feature is that your vacation management system integrates well with other HR management software and time tracking tools. If you can't easily pass information from your LMS to your payroll department, the convenience and accuracy of your leave management system will be compromised.

Fortunately, many vacation management tools support APIs and other integrations with existing systems, allowing you to avoid disruptions and eliminate data silos.

Streamline vacation management without programming effort

Vacation management includes everything from balance entry to attendance and absence management. With a comprehensive leave management system, you can process employee leave requests in accordance with company policies and labor regulations, and keep your team informed throughout - from managers to payroll.

Simplify your leave tracking with Icehrm's Leave Management System. Boost productivity effortlessly and experience the ease of efficient time-off management. Take the next step towards a stress-free leave management approach!