HR Glossary
Plain-language definitions of HR, compliance, and employee-benefits terms — everything a modern Indian business needs to know.
40 terms
A
Abilene Paradox
The Abilene Paradox is a situation where a group of people collectively decide on a course of action that none of the individuals actually want.
Absconding
Absconding is when an employee stops coming to work without getting permission or informing anyone. It is a form of job abandonment where the individual ignores the formal resignation process and the required notice period.
Absenteeism
Absenteeism is a repeated pattern of being away from work without a clear reason or prior notice. Unlike a planned vacation or an occasional illness, it involves frequent, unscheduled absences that disrupt a team’s ability to function…
Appointment Letter
An appointment letter is a formal document issued by an employer to a new hire to confirm their employment. It acts as a legally binding contract that outlines the specific terms of the job, including salary, responsibilities, and company…
Appraisal
An appraisal is a formal, scheduled review of an employee’s work and their overall contribution to the company. It is a structured conversation where managers and employees discuss what went well, identify areas that need improvement, and…
Apprenticeship
An apprenticeship is a “learn while you earn” program where a person is trained on the job to become an expert in a specific trade or skill.
B
Basic Salary
Basic salary is the fixed portion of an employee’s pay before any extra allowances, bonuses, or deductions are taken out. It serves as the primary base used to calculate other benefits like retirement funds and insurance.
Bereavement Leave
Bereavement leave is a type of compassionate leave that allows employees time off to grieve, manage funeral arrangements, and handle personal matters after the loss of a loved one.
Bonus
A bonus is simply extra money paid to an employee on top of their regular salary. In India, some bonuses are a choice made by the company to reward hard work, while others are a legal requirement to ensure employees get a fair share of the…
Buddy System
A buddy system is an onboarding practice where a new employee is paired with an experienced team member during their first few weeks.
C
Casual Leave
Casual Leave is a set number of paid days off provided to employees for short-term personal work or minor emergencies. It is designed to help staff manage their private lives and unexpected errands without losing pay or using up their…
Cover Letter
A cover letter is a short, professional letter that a candidate sends alongside their resume. It acts as an introduction, explaining why they are interested in a specific job and how their background makes them a good match for the…
D
Demotion
Demotion is the process of moving an employee to a lower rank or grade within an organization. This change usually involves fewer responsibilities, a lower pay scale, and a shift in reporting lines.
Departmentalization
Departmentalization is the process of grouping employees and tasks into specific units or departments. This structure helps a growing company manage complexity by creating clear areas of focus and defined leadership.
E
Employee Engagement
Employee engagement is the level of mental and emotional connection an employee feels toward their work, their team, and the organization.
Employee Net Promoter Score (eNPS)
eNPS is a simple metric used by HR teams to measure employee loyalty and satisfaction by asking how likely they are to recommend their company as a great place to work.
Employee Provident Fund
The Employee Provident Fund (EPF) is a government-managed retirement savings scheme in India. It works by pooling monthly contributions from both the employee and the employer.
Employment Basics
Employment Basics refers to the fundamental concepts that define the legal and practical relationship between a worker and an organization.
Enterprise Resource Planning (ERP)
Enterprise Resource Planning (ERP) is a software platform that connects all the different parts of a business into one system.
Equity
Employee equity is a form of non-cash compensation that provides employees with a sense of ownership in the company. By offering “shares” or “options,” an organization allows its team to benefit directly from the company’s growth.
F
Facilitative Leadership
Facilitative leadership is a collaborative management style where the leader acts as a moderator to help the team reach its own decisions. It moves away from top-down commands to focus on shared responsibility and open dialogue.
Factories Act
The Factories Act is the primary legislation that governs the working conditions in industrial settings. It sets strict rules for worker safety, health, and welfare to ensure that employees in manufacturing units are protected and treated…
Financial Year
The Financial Year (FY) is the 12-month window that the government and companies use for all things related to money, budgets, and taxes. In India, this cycle starts on April 1 st and ends on March 31 st of the following year.
G
Gig Worker
A gig worker is an individual who performs work or participates in a work arrangement and earns from it outside of a traditional employer-employee relationship.
Gratuity
Gratuity is a lump-sum financial benefit paid by an employer to an employee as a token of appreciation for their long-term service. In India, this is a legal requirement under the Payment of Gratuity Act, 1972.
Gross Salary
Gross salary is the total amount of money an employee earns before any taxes or mandatory deductions are removed. It includes your base pay plus all the extra allowances, bonuses, and perks provided by your employer.
H
Hiring Strategy
A hiring strategy is a long-term plan of action designed to find, attract and hire the best possible candidates for an organization.
House Rent Allowance (HRA)
House Rent Allowance (HRA) is a significant salary component provided by employers to help employees meet their house rent expenses.
Human Resource Management System (HRMS)
A Human Resource Management System (HRMS) is a comprehensive software suite that integrates core HR processes like payroll, attendance, and performance management into a single digital ecosystem to improve data accuracy and operational…
I
Internal Job Posting
An Internal Job Posting (IJP) is an open role within a company that is advertised specifically to current employees. This gives the existing team the first opportunity to apply for promotions or lateral moves before the company looks for…
ITR Filing
An Income Tax Return (ITR) is a form you submit to the government to report how much money you earned from April 1st to March 31st. It covers your salary, bank interest, house rent, and any profits from selling stocks or property.
J
N
O
P
Paternity Leave
Paternity leave is a period of paid time off provided to a male employee following the birth or adoption of a child. It is designed to give new fathers the time to care for their partner, bond with their newborn, and manage family…
Payslip
A payslip, also known as a salary slip, is a document issued by an employer to an employee every month. It provides a detailed breakdown of the total earnings for that period and the various deductions made before the final “take-home”…
R
Reimbursement
Reimbursement is when a company pays an employee back for work costs they covered with their own money. It is a way to ensure staff members are not out of pocket for buying items the business needs, such as travel tickets or office…
Relieving Letter
A relieving letter is an official document an employer gives to an employee who has resigned. It confirms that the person has finished their notice period, handed over their responsibilities, and is now formally released from their duties…