Even when only changing from granting 15 annual leave days on the first accounting date to a pro-rata policy based on service period (while keeping the [Accounting Date] grant method the same), the policy is retroactively applied as if annual leave was granted proportionally from the start.
Particularly for 'mid-term hires', they would have appeared to receive 15 days on January 1 of 2022 or 2023 without issues, and employees would have used annual leave or adjustments would have been made accordingly.
Before the policy change the balance was 0, but after the change, mid-term hires may receive pro-rata grant on January 1 of 2022 or 2023, resulting in a negative (-) balance.
Therefore, to check and adjust remaining balances using the adjustment feature, please make sure to download the
[Attendance Management] → [Leave Management] → [Leave Balance Status] → [Leave History] report before and after the policy change!!
Changing the Policy
[Settings] → [Annual Leave Settings] → [Annual Leave Grant Settings] where annual leave is granted on the accounting date, changing from granting 15 days on the first accounting date to granting proportional annual leave based on service period on the first accounting date (example)
When comparing the [Leave Report] before and after the change, you can see that the expected annual leave grant quantities for 2024 have changed for employees B and D.
Employee D: Would have received 15 days in 2024 without the policy change, but due to the pro-rata policy change, it's calculated as if advance usage occurred, reducing the 2024 annual leave grant to 3.5 days. In this case, you can grant the remaining 11.5 days using the annual leave adjustment feature.
Employee B: Would have received 15 days in 2024 without the policy change, but with the pro-rata policy, they are expected to receive 5.5 days based on (total service days / 365 days × 15 days) with half-day rounding up for decimal places. In this case, no additional adjustment is needed.
Things to Check After Policy Change
Since the pro-rata policy change may cause remaining balances to be calculated as if advance usage occurred, resulting in different 2024 grant quantities, you should use the annual leave adjustment feature to make corrections.
FAQ
Do I need to update employment rules when changing the annual leave policy?
Do I need to update employment rules when changing the annual leave policy?
When changing the grant policy from hire-date-based to accounting-date-based, we recommend adding the following clause to your employment rules: 'The calculation basis date for annual paid leave shall be managed on a fiscal year basis (January 1 - December 31) for administrative convenience and efficiency. Upon resignation, leave days shall be recalculated based on the hire date to ensure no disadvantage to employees.'
We plan to implement annual leave promotion after changing to the accounting-date policy.
Are carried-over annual leave days through adjustment included in the July 1, 2024 promotion target quantity?
We plan to implement annual leave promotion after changing to the accounting-date policy.
Are carried-over annual leave days through adjustment included in the July 1, 2024 promotion target quantity?
Yes, they are included in the annual leave promotion. If you adjusted on January 1, 2024 and granted 3 additional days, flex recognizes the employee as having received 18 annual leave days for 2024. During the promotion period, if the employee used 8 total annual leave days, promotion will proceed for the remaining 10 days.
We plan to implement annual leave promotion after changing to the accounting-date policy.
Can carried-over annual leave through adjustment be excluded from the promotion target quantity?
We plan to implement annual leave promotion after changing to the accounting-date policy.
Can carried-over annual leave through adjustment be excluded from the promotion target quantity?
If you grant the remaining annual leave days that need to be adjusted as [Custom Leave], they will not be counted in the promotion target quantity. Additionally, you can manage it so that custom leave from existing remaining annual leave is used first. Please refer to the guide below for details on custom leave granting.