Leave Types and Allowances How to define the leave your organisation offers: allowances, accrual, carry-over, pay, and the eligibility rules that decide who can take what.

Leave types are the definitions behind every request. Each one carries its own allowance, its own rules and its own pay treatment, and each can differ per hub - which is the point, because statutory leave is a jurisdiction question.

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The Allowance

Annual allowance is the days per year for this type.

Monthly accrual rate decides how those days arrive. Set a rate and the balance builds through the year; leave it and the allowance is available up front. Accrual runs automatically - a daily job and a monthly job on the first - so nothing has to be granted by hand.

Accrual is the honest default for most organisations. A leaver who has taken the full allowance in February has been paid for days they had not earned, and that is a settlement conversation nobody enjoys.

Carry-Over

Carry over decides whether unused days survive into next year, and maximum carry-over days caps how many.

Cap it. An uncapped carry-over accumulates into a liability that sits on the balance sheet and eventually gets taken all at once.

Pay Treatment

Is paid marks whether the type is paid at all - unpaid leave is a real category and belongs here rather than being handled off-system.

Pay percentage covers the partial cases, where a jurisdiction pays a proportion after a certain number of days.

Pay rules carry anything more structured than a flat percentage, which is how a type like sick leave can pay in full for a first period and at a reduced rate afterwards.

Eligibility

The rules that decide whether a person can use a type at all:

Rule	Decides
Minimum service months	How long someone must have been employed
Probation eligible	Whether it can be used before probation ends
Gender applicable	Where a statutory type applies to one group
Maximum consecutive days	The longest single stretch
Requires documentation	Whether proof must be supplied

These are why a type someone can see may still refuse a particular request. Worth stating in your own policy document too, so the refusal is not a surprise. See Policies and Acknowledgements.

Encashment

Is encashable marks whether unused days can be paid out rather than taken. It matters most at exit, where it becomes part of the final settlement.

Per Hub

Leave types can be scoped to a hub. A UAE entity and a UK entity have different statutory minimums, different sick pay rules and different public holidays, and one shared set would be wrong for at least one of them.

Create the types your jurisdictions actually require. Copying one hub's set into another because it is quicker is how a compliance gap starts.

Categories

Each type carries a category - annual, sick, casual, maternity, unpaid, or custom - which groups it for reporting. The name is yours; the category is how it is counted.

Setting Up A New Type

1. Name it as employees will ask for it. "Compassionate leave", not "CL-2".
2. Set the category.
3. Set the allowance, and the accrual rate if it should build through the year.
4. Decide carry-over, and cap it.
5. Set the pay treatment against the statute for that hub.
6. Set eligibility - service, probation, consecutive days, documentation.
7. Scope it to a hub if it is jurisdiction-specific.
8. Save, then submit a test request against it before announcing it.

That last step catches more than it should. A type with a rule nobody tested is a type that refuses requests on its first day.

Adjustments

An HR admin can adjust a balance directly, and the adjustment is written to the ledger with a reason. Use it for corrections, transfers from a previous employer, or a goodwill grant - and always write the reason, because the ledger is what someone reads when they ask why their balance changed.

Common Questions

Someone needs more days than the allowance. Make an adjustment with a reason. Do not raise the allowance for everyone to solve one case.

Can I change an allowance mid-year? Yes. It affects future accrual; days already accrued stay in the ledger.

A type is not appearing for someone. Check eligibility first - service months and probation are the usual causes - then check the hub scope.

What happens to unused days when someone leaves? That depends on encashment and your settlement process. See Offboarding.