A clear leave policy saves hours of back-and-forth and prevents "but my manager said it was fine" disputes. It should be short enough to read, specific enough to apply, and consistent with the law that covers your business.
1. Scope and leave year
State who the policy covers (employees, interns, contract staff) and the leave year (calendar or financial year).
HR, GPS attendance, shifts, leave, payroll, tax declarations, onboarding, engagement, projects and timesheets — one employee record behind all of it.
Start free See the demo2. Types of leave
| Leave type | Typical practice | Notes |
|---|---|---|
| Earned / privileged leave | Accrues monthly, can carry forward up to a cap | Minimum entitlement and eligibility depend on the applicable law |
| Casual leave | For short personal needs, 1–2 days at a time | Often lapses at year end |
| Sick leave | For illness; medical certificate beyond a set number of days | Often lapses or has a small carry forward |
| Maternity leave | Up to 26 weeks for the first two children | As per the Maternity Benefit Act |
| Paternity leave | Common in private companies by policy | Not a general legal mandate in the private sector |
| Bereavement, marriage, study leave | Optional policy benefits | Define eligibility and proof |
| Compensatory off | For work on a holiday or weekly off | Set an expiry, e.g. 60 days |
| Leave without pay | When balances are exhausted | Needs approval |
3. Accrual and eligibility
Explain when new joiners start earning leave (for example pro-rata from joining), and whether probationers can take leave in advance.
4. Applying and approvals
- Apply through the HR system, not chat messages.
- Notice period: for example 7 days for planned leave, same-day intimation for sickness.
- Approver: reporting manager; HR for long leaves.
- What happens if leave is taken without approval.
5. Sandwich rules and half days
Say clearly whether weekends or holidays between leave days count as leave, and whether half-day leave is allowed.
6. Carry forward and encashment
Set the maximum carry forward, whether excess lapses or is encashed, and how leave is settled at exit.
7. Holidays
Publish the holiday list at the start of the year, including national holidays and state or festival holidays. Some companies allow a few optional holidays from a list.
A one-page template
Leave year: January–December. Earned leave: 1.5 days per month, carry forward up to 30 days, encashable at exit. Casual leave: 7 days per year, max 2 consecutive days, lapses at year end. Sick leave: 7 days per year, certificate needed for more than 2 consecutive days. Maternity and paternity: as per law / 5 working days. Comp-off: valid for 60 days. Approvals: reporting manager through the HR system; apply 7 days ahead for planned leave.
Make it run itself
Once the rules are written, put them in software so balances, accruals, carry forward and approvals happen automatically. In MizUp BMS, leave policies, holiday lists and approvals connect to attendance and payroll, so leave without pay flows straight into the salary run — see the payroll process guide.
Frequently asked questions
How many days of leave must a company give?
It depends on the law that applies to your establishment and state — the Shops and Establishments Act of your state or the OSH Code for covered workplaces. Many companies offer more than the minimum to stay competitive.
Is maternity leave mandatory?
Yes, under the Maternity Benefit Act for eligible women employees in covered establishments: up to 26 weeks for the first two children and 12 weeks thereafter.
Can unused leave lapse?
Casual and sick leave commonly lapse at year end. Earned leave is usually carried forward up to a cap and may be encashed, subject to the law and your policy.
