The Basics of HR Policy in India

Published On: Aug 8, 2023Last Updated: Aug 8, 20237.3 min read

When a business starts to grow and expand, the need for resources and manpower increases. With that said, when there are a number of people who work together, it is necessary to have certain guidelines to maintain a healthy working environment. That’s when the HR policies and procedures come into the picture. Having defined HR policies is a common practice in businesses and companies across the world. This blog post will help you understand exactly what is HR policy, when it’s needed and the best HR practices and procedures that a growing company or startup must have! 

What is HR policy? 

The Human Resource policies are a set of principles followed by a company. It defines the internal relations at a workplace. The entire set of a company’s HR policies, include many different aspects of workplace management governed by separate policies. Besides, the human resource policies are dynamic in nature, considering the growth of the business. Hence, it is an important document for the growth of a business. You can take assistance from Legal drafting services providers online to draft the ideal HR policy framework for your company.

What is the purpose of an HR policy of companies? 

Most companies define their HR policies during their initial months itself. Hence, this proves the value the HR policies hold for companies. Apart from focusing on profits, the businesses today also aim to focus on the employee welfare. Any or all of the following circumstances are the reasons why a company drafts the HR policies for employees: 

  • When the startup is in its growth stage (which involves on-boarding new talent regularly);
  • To set an acceptable standard of behavior; 
  • To maintain some discipline and orderliness at workplace; 
  • When it is seen that there is a lack of clarity and structure in the business operations; and
  • Lastly, to avoid clashes of interests or personal interests at the workplace. 

From all these points, it is pretty clear that the main purpose of an HR policy of a company is to create, maintain and promote a healthy workplace environment.

Who drafts the Human Resource Policies? 

In most businesses and companies, the Human Resources (HR) Department or Manager is responsible for creating and maintaining the workplace policies. However, since the HR policies and procedures you draft will govern the orderliness at the workplace, it is very important to maintain utmost care and due diligence while drafting the HR policy. 

Key inclusions in HR Policy

An HR policy for a company or any other business must be drafted in such a way that it helps in creating and maintaining a cohesive work environment. 


One of the most important things that you need to define in your HR policy is its applicability. Generally, the human resource policy of a company is applicable to all employees, including the full time, part-time, permanent, temporary and other office staff. 

Hiring Practices of company

The hiring practices also come under the domain of the HR manager. Thus, forms another important part of the company policy. To maintain equality amongst the employees, it is important to have a standard hiring procedure or practice. This standard practice policy can include the aspects of hiring as to the number of interviews, the metrics for reviewing candidates potential, etc. 

Timings and Attendance 

In this section you need to define the ‘working hours’ and ‘business days’ applicable to your employees. All businesses have different rules and regulations related to the clock in/clock out, attendance, working hours, work shifts, overtime compensations, etc. Hence, you must look at the comfort and needs of your company and employees before finalizing the timings and attendance related provision of your HR Policy. The gist of such details also form a part of the employment contract of a company.

Leave Policy 

Employees of a company are entitled to a certain number of annual holidays, paid leaves, sick leaves, casual leaves, paternity and maternity leaves, etc. So, in this part of the HR policy you need to mention the number of leaves an employee can seek without having his/her pay deducted. Further, this section also includes the other rules for the sick leaves, and casual leaves. In case either the employee or the employer fails to act in accordance with this part of the HR policy, then they can be questioned on this basis. 

Fun Fact: Increasing number of startups are including a provision for menstrual leave entitlement for their women employees. Even clients have opted for this provision. This indicates a strong step towards women empowerment. If you too want to include this provision in your HR policies, you can reach out to experts and learn about its norms! 

Health, Safety and Security

In a workplace, where people spend the majority of their productive hours, it is important to build a safe and secure environment. Hence, it is also important to cover these aspects in the company’s HR policy. Especially, after the global pandemic of covid 19 when health, safety and well – being are primary concerns for most. 

For example, According to ABC pvt. Ltd.’s HR policy, there must be a mandatory sanitization of the workplace premises at least once a month. This policy is only applicable to that particular company and its work premise. 

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Work From Home Policy

Ever since the global pandemic, one other famous trend we have seen is the trend of remote working. So, most companies include a separate work from home policy in their charter HR policy. This policy defines the rules that an employee subject to WFH must adhere to. This includes the rules related to designated work space, maintaining time sheets, maintenance of the company’s assets, etc. 

For example, if ‘A’ works in an IT firm and is currently working under the remote work policy. Now, according to his company’s HR policy, in case of any network issues or disturbances, the employee on WFH is required to inform his/her manager promptly. However, he does not follow this code of conduct. As a result, here the company reserves the right to stop that particular employee’s remote working condition, and ask him to show back to work on company premises. 

Compensation and Performance Reviews 

Every year, the employees of a company are entitled to increments based on the performance review by their reporting manager. In this section of the human resource policy, the company needs to set a standard for key performance indexes (KPI)s. Then, you can also include the duration of the performance reviews, incentive plans, and other compensation/bonus related benefits in this part of the HR policy. 

Code of conduct

This includes the disciplinary terms of a company. Such as the dress code, use of appropriate and professional language, workplace ethics and more. Further, the employees are also subjected to confidentiality terms of an NDA. You can get a better idea by reading “What is Non Disclosure Agreement?“.

POSH policy 

POSH stands for the prevention of sexual harassment at workplace. This part of the HR policy can be drafted as an entire separate policy with mandatory compliance requirements. This must cover the incidents of sexual harassment, manner of reporting such activities/incidents, and must also provide a defined reddressal mechanism. 

Work Travel Compensations

It is very common that employees need to travel for business purposes. In such a scenario, most companies refund the expenses that the employee incurs during the travel for an office objective. Here, you can define the terms of asking for a refund and the calculation of ‘office expenses’. 

Bring your own device (BYOD)

Most common policy for new age startups is the BYOD policy. According to this policy, the employees are required to continue office work from their own laptops, mobiles, routers, phones, etc. This also includes the terms related to protection of the company data, and limitation of access to social media for personal use, etc. 

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Pro – Tips for drafting HR policy! 

Here are some pro-tips from experts that will help you draft your ideal human resources policy: 

  • While drafting the HR policy, keep the companies SOP in mind; 
  • Ensure that the HR policy you draft is in accordance with the prevailing employment laws;
  • Ensure that it is cohesive enough to safeguard rights of the employer as well as employees; and 
  • Lastly, don’t forget, the aim is to make a positive impact on the organization. 

You can get your HR policy drafted by experts, even without getting up from your couch! Connect with the experts today and get your HR Policy draft!

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Diksha Shastri
About the Author

Diksha Shastri

As a writer, Diksha aims to make complex legal subjects easier to comprehend for all. As a Lawyer, she assists startups with their legal and IPR drafting requirements. To understand and further spread awareness about the startup ecosystem is her motto.

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