Leave Design Concepts and Advanced Scenarios

Leave design involved a large number parameters, there are multiple methods of leave accrual, different types of leaves for different sets of employees, year end conditions and then there are requirements to change the leave policy for a leave which is in use. In this article we provide a detailed explanation of various concepts and also some advanced scenarios which can be configured while designing a leave.

Leave Design Concepts

A. Leave accrual

Accrual of a leave is done on the basis of the following attributes

- Leave basis : this is the basis on which leave is given, it can be a periodic basis like per quarter / per month or per incident or per employment duration

- Accrual method : is used to define when the leave is accrued, it can be beginning of period / end of period / pro-rata / lump-sum

- Leave value : the amount of leave which is accrued, it can one number or it can be formula based

- Accrual to be done from : this links the date from which system will give the leaves to employee, it can be date of joining, date of probation confirmation or date of entry

Refer to the article on Creating a new leave type for details of each of these attributes. Each of the attribute is explained below.

1. Leave basis - This is the basis of on which leave is given to the employee. It defines the period or instance on which leave is given. There are eight basis of leave

- Per Annum : leave is given on an annual basis

- Per Incidence : the leave is given when requested by the requester, there is no defined accrual

- Per Month : the leave is given on a monthly basis\

- Per Day : the leave is given for each day - refer to article on "calendars" for more details and the note bottom of this article to understand how working days are defined

- Quarterly : the leave given on a quarterly basis\

- Total for Employee : a certain fixed value of leave is given during the employment period

- Weekly : leave is given on a weekly basis

2. Leave accrual methods -This defines the point of time when leave is credited to the employee's leave account. There are six primary methods of accrual and some accrual methods work only with some leave basis

- Per Incidence : leave is accrued when approved

- Beginning of Year / Month / Quarter / Week : leave is accrued as per the frequency selected but at the beginning of the period

- End of Year / Month / Quarter / Week : leave is accrued at the end of period
 - Beginning of Week accrual is on every Monday morning and End of Week accrual is on every Sunday night

- Prorata : accrual is done on a daily basis as per the daily accrual value

- Beginning of Year-Lumpsum : in this method the leaves for the entire year will get credited in the beginning of the year – system will not check for the employee's date of joining. In the option "Beginning of Year" the leaves will be credited only based on the date of joining so if someone joins on 1-Jul he will be getting half of the annual leaves

- Beginning of Period : this will work only with Leave Basis - Total for employee. The amount of leave in this method will be granted to the employee as soon as he is eligible, the other policies will be applicable as configured

3. Leave value - the amount of leave which is to be credited for all periodic leaves is defined by this parameter. Refer to the write up below on Formula based leave value for more details.

4. Accrual to be be done from - There are three options

- Date of Confirmation : leave accrues from the date an employee on probation is confirmed

- Date of Joining : leave accrues from the date of joining

- Date of Entry : leave accrues from the date of entry
Refer to the article on Manage Employee Type change for more details on how Date of Entry / Date of Joining / Date of Confirmation are managed for different types of employees.

B. Leave consumption

Leave balances available as on a day are used to check how many leaves an employee can take. The employee's leave balance is reduced on submission of leave request. If the leave request is modified or withdrawn the leave balance is accordingly updated. Leave requests are also made automatically in some scenarios, when HR / Manager regularizes missing attendance or if the Payroll Manager converts missing attendance records in Leave Without Pay system creates leave records and reduces the leave balance. Leave details can be seen in Employee Leave Report

C. Leave expiry / Leave lapsing

Some leaves like Compensatory Off leave expire after their expiry period. Lapsing of leave happens at the end of year based on the carry forward rule

D. Leave eligibility

Before leaves can be taken by an employee he has to be eligible for them and he has to have a leave balance. Eligibility for a leave is based on the eligibility criteria which is defined with each leave in leave setup. The default criteria is "All" which means that everyone is eligible for the leave. Various parameters like Department, Division, Employee Type, Employment Status, Gender, Job Duration, Level, Office Location, Work Location and Work Status can be used to create eligibility criteria. Eligibility criteria can be changed after it is created but only from a future date.

Whenever a new leave is created system will map all the employees against the eligibility criteria and make those meeting the criteria eligible for the leave. Whenever the parameter which is used in eligibility criteria changes at employee level system checks and if the employee is not longer eligible or if he was not eligible but is eligible now the appropriate changes are done.

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Advanced Scenarios

These are some advanced scenarios which can be configured in leave setup.

1. Formula based leave value

You can have differential accrual of same leave across different groups of employees by using a formula based leave value. This feature is available for Accrual Method = Beginning of Year / Month / Quarter / Week  or End of Year / Month / Quarter / Week. The parameters which can be used for creating a formula are - Seniority Level and Job Duration but only one parameter can be used in one leave type. As shown in the example below the leave value is based on the level of the employees.

2. Holiday counted and Weekly off counted

If a leave is taken and there are some holidays or weekly offs during the leave period. Whether these holidays and weekly offs will be counted as leaves or not will depend upon the company policy. While creating leave the setting can be done to ensure that these leaves are counted as holiday. The parameters for Compulsory holidays and Weekly off are separately and can be configured independently.

Example
- Suppose Casual leave and Earn leave both have holiday counted = Yes
- Saturday and Sunday are weekly off

1. If an employee applies for Casual leave from Friday to Monday it will show 4 days of leave
2. Or if an employee applies for Casual leave on Friday it will be shown as 1 day but then system will not allow him to apply for another Casual or Earn leave on Monday without including Saturday and Sunday
3. Leaves which have holiday counted = Yes will not be allowed to taken in the succession if there are holidays falling in the middle

3. Clubbing of leaves

There are some leaves which cannot be clubbed together, this can be defined in leave setup. System will prevent you from submitting a leave which cannot be clubbed with another if the other leave has been submitted or approved.

Example
- Suppose Casual leave and Earn leave are not allowed to be clubbed together
- If an employee applies for Casual leave on Thursday he will not be allowed to take a Earn Leave on preceding Wednesday or succeeding Friday
- If an employee applies for Casual leave on Friday and Saturday / Sunday are Weekly Off days, he will be still allowed to take a Earn Leave on next Monday.

4. Stopping accrual of leaves

Suppose an employee is on Maternity Leave for 3 months. Sometimes there are policies which specify that during this period of 3 months no other leave will accrue to the employee. There is a feature in leave setup for this scenario and it is managed through the parameter–“No Accrual for these leave types”. This will work only for Leaves which have accrual method = Prorata.

We can select any leave types from drop down for any prorate leaves and the employee will not get any accrual of the primary leave whenever he is on any of the selected leaves.

5. Gifting of leaves

This is an optional feature and can be activated from Leave Setup for any leave type except Per incident and Restricted Holiday leave type. Basic premise is that an employee can gift any leaves which are available in their account to any other employee in the company.

As an employee can use Gift Leave button for gifting your leave to other employee which is available on the leave type which have gifting option. Select employee name, and put the leave gifting value for gifting as shown in the image below.

1. On gifting an alert will go to HR and the receiving employee
   
2. Leave balance will be reduced and consumed figure will go up for the giving employee
   
3. Details of gifting will be visible in Details of leave credit report
   
4. Gifting cannot be done for Compensatory Off, Leave Without Pay, Restricted Holiday Leave and Per Incident leaves and cannot be reversed once done

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