“As a prudent operational risk management measure, the banks shall put in place a ‘mandatory leave’ policy wherein the employees posted in sensitive positions or areas of operation shall be compulsorily sent on leave for a few days (not less than 10 working days) in a single spell every year, without giving any prior intimation to these employees, thereby maintaining an element of surprise”, RBI said. Banks shall ensure that the employees, while on ‘mandatory leave’, do not have access to any physical or virtual resources related to their work responsibilities, with the exception of internal/ corporate email which is usually available to all employees for general purposes, the circular said. The circular further said that the revised instructions shall be applicable to all the banks and they shall comply with these instructions within six months from the date of issue of above circular.
As per mandatory leave policy for banks, the employees posted in sensitive areas in banks are required to compulsory avail leave of about 10 days in a single spell every year. The treasury, currency chests, risk modeling, model validation etc., are considered as sensitive positions or areas of operations which are covered under a ‘Mandatory Leave’ policy. However, RBI observed that ‘staff rotation’ policy and policy for ‘mandatory leave’ for staff were not effectively implemented by some banks. The apex bank further observed that ineffectual implementation of the policy is leading to an increase in operational risk across the banks. some banks were not very serious about implementing the above leave policy, RBI vide its notification DBR.No.BP.BC.88/21.04.048/2014-15 dated April 23, 2015 directed the banks to immediately put the arrangements in place and implement the directions without fail. The Central bank coming down heavily on those banks which are not implementing mandatory leave policy, asked these banks to identify such highly sensitive positions where they will without any prior intimation, advise the employee to be away from his/her desk for a specified number of working days each year. As per RBI directives, it should be ensured that such employee does not have access to any physical or virtual resources related to his work responsibilities, with the possible exception of corporate email.
As per the guidelines, as a prudent operational risk management measure, banks are required to have a policy for staff rotation and mandatory leave for their employees positioned in sensitive positions or areas. An exhaustive list of sensitive positions or areas of operations to be covered under ‘mandatory leave’ and under ‘away from desk’ requirement, may be decided as per the bank’s own policy duly approved by the Board of Directors or committee of the Board, and the incumbents of these positions should be kept aware of the above requirements. Implementation of such policy would be covered under the Pillar 2 review of banks’ risk management system by the Reserve Bank of India.To know the improvement in leave rules of banks effective from 11.11.2020 read;
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