Allowances and entitlement

Entitlement is the number of leave days an employee gets from one allowance in one leave year, and Leavely calculates it from the Allowance Policy of the employee.

How it works

Five parts work together:

Allowance Types

An Allowance Type is a pool of days, such as Annual Leave. When you set up your company, Leavely creates the Annual Leave Allowance Type and links the Leave Type named Annual Leave to it. The setup also sets the starting days of Annual Leave and its carry-over rules. You can add more Allowance Types in Settings > Allowances.

A Leave Type uses days from an Allowance Type only when its Deduct From Allowance setting names that Allowance Type. With No Deduction, requests of that Leave Type use no days. See Leave Types.

Allowance Policies

An Allowance Policy is a named set of rules for one Allowance Type: its Tenure Tiers and its carry-over rules. One Allowance Type can have many policies, for example Standard and Managers under Annual Leave.

Each Allowance Type has one default policy, which Leavely creates with the name Standard. An employee follows the default policy until an Owner or Admin assigns another policy of that Allowance Type. An employee has one Allowance Policy for each Allowance Type.

Tenure Tiers

A Tenure Tier gives a number of days for a length of service. The first tier starts at hire. Each other tier starts on an anniversary of the employee's Start Date. For example:

A tier states the full number of days for a year. It does not add days to the tier before it. A policy with one tier gives the same days a year to every employee. Employees who join or leave during the year still get a share.

Entitlement for a Leave Calendar

Leavely calculates the entitlement of each employee for each Leave Calendar:

1. It splits the Leave Calendar into periods at the Start Date of the employee, the End Date of the employee, and each date on which a new Tenure Tier starts.
2. Each period gets its share of the tier's days: the days in the period, divided by the days in the Leave Calendar, multiplied by the tier's days. Leavely counts calendar days, not working days.
3. Leavely adds the shares and rounds the total once, to the nearest whole day. Exactly half a day rounds up.

A new employee, an employee who leaves, and an employee who moves to a higher tier all follow this one calculation. Leavely does not wait for the anniversary. The new tier is already part of the entitlement for the Leave Calendar in which the anniversary falls.

To learn how leave years and Leave Calendars work, see Leave year and leave calendars.

Leave Balances

A Leave Balance holds one employee's days for one Allowance Type in one Leave Calendar. Its available days are the entitlement, plus the days carried over from the previous Leave Calendar, minus the days used. Available days are never below 0.

An approved Leave Request of a linked Leave Type uses days from the Leave Balance. Leavely rejects a request when the Leave Balance does not have enough available days. Employees see their Leave Balances in My Year.

When you set up the company, add an employee, or add an Allowance Type, Leavely creates Leave Balances in the Current Leave Calendar and the one after it. When you add a Leave Calendar, Leavely creates balances in it for the employees and Allowance Types that exist at that time. An employee whose End Date is before a Leave Calendar starts gets no Leave Balance in it.

Leavely calculates the entitlement again when you change a policy's Tenure Tiers, assign another policy to an employee, or change an employee's Start Date or End Date.

Worked example

All examples use a Calendar leave year from January 1 to December 31, 2026, which has 365 days. The employees follow this policy:

The dates and the policy are examples. The results come from the calculation above.

An employee joins during the year

In the September 15 row, 5.92 rounds up to 6 days.

An employee leaves during the year

The employee started on January 1, 2023, so the From hire tier of 20 days applies for all of 2026.

An employee reaches a new Tenure Tier

The After 5 years tier starts on the fifth anniversary of the Start Date.

In the last row, the anniversary falls in 2027: 59 days at 20 and 306 days at 25 give (59 × 20 + 306 × 25) ÷ 365 = 24.19, which rounds to 24 days.

What happens when

You change an Allowance Policy during the year

Leavely calculates the entitlement again for every employee on that policy, in each Leave Calendar that has not ended. It applies the new Tenure Tiers to the whole Leave Calendar, including the months before the change. Leave Calendars that have ended keep their entitlement.

Carry-over rules that you change apply the next time Leavely carries days over or checks for expiry. See Carry-over.

You move an employee to another Allowance Policy

Leavely calculates the employee's entitlement again with the new policy, for the whole of each Leave Calendar that has not ended. It does not split the year at the date of the change. Leave Calendars that have ended keep their entitlement.

A change would leave fewer days than an employee has used or requested

Leavely blocks the change. This applies to policy changes, policy assignments, and Start Date or End Date changes. The days that count are the used days plus the days in pending Leave Requests. For a policy change or a policy assignment, the message shows these days and the new total. To continue, cancel or resolve the pending Leave Requests first. If the used days alone are more than the new total, pending requests do not matter. Choose a higher number of days instead.

You archive an Allowance Policy

You can archive a policy only when no employee is assigned to it, so no Leave Balance changes. You cannot archive the default policy.

You archive an Allowance Type

Leavely archives its policies and removes its policy assignments. Its Leave Balances no longer show to employees, and Leave Types that used it change to No Deduction. See Archive an Allowance Type.

Related pages

• Allowances
• Carry-over
• Leave year and leave calendars
• Leave Types
• Employees
• My Year