Mr. Brij Mohan is the head of Software Consulting Division of WIC. In March 1999 he received a notification from the head office on the leave encashment to be followed with some modification. Company's leave policy earlier was to give 30 days Annual Leave without distinguishing between causal leave and earned leave. This leave was subject to encashment every year up to 50% of the leave, with total accumulated leave not to exceed 180 days, this was going well as the compulsion for the company was to have minimal absence and this policy was supposed to ensure presence of the employees.

A new HR Head joined the company and after detailed analysis came to the conclusion that this policy is cost ineffective for two reasons firstly, that employees tended to save the annual leave and avail the sick leave only. Secondly, he believed that if leave is appropriately scheduled it will be possible for employees to take leave. He also gathered from policies of progressive companies which insist that employees take at least ten days mandatory leave as per a pre-scheduled leave pattern as it improves the overall quality of life and motivation. After obtaining the consensus and approval of top management HR has revised the policy effective Fiscal Year '99-2000.

Brij Mohan has communicated the same to all his employees working at different client sites. Due to the project deadlines no one from his group have availed leave.

Now it is November 1999 and today he has received three leave letters from his team leaders and each of them want to go on leave for 20 days. Brij Mohan feels that the team leaders are justified to take leave as anyway they do not have any encashment facility. Brij Mohan's worry is not only the completion of the task on hand by December 5th 1999, but also how to face the rest of the team as it is learnt that they are also ready to put in their leave letters. He kept the leave letters pending and told the team leaders : "This change in the leave policy by HRD department is creating a great problem for me, let them give me a solution for this".