# Common Leave Year

## What is common leave year?

Leave year refers to the cycle of annual leave, which is the quota for a whole year, and the common leave year means that the employer can designate any period of 12 months as a “common leave year”, which is used to define the start date and end date of the leave year to unify the cycle of paid annual leave for all employees.

## The importance of common leave year

The common leave year is a way to unify the employee’s annual leave cycle. It will not affect the total days of employees’ annual leave or the days increasing year by year, but it will be easier to manage.

## The benefits of common leave year

One advantage of choosing a common leave year is that the “clear time” of all employees is on the same day, which is convenient for calculating the leave quota and clear time, which is not only convenient for employers to manage, but also easy for employees to view and apply their annual leave.

## The calculation of common leave year

If an employee has not been employed for 12 months in the common leave year, the employer should calculate his leave entitlement on a pro rata basis, and any fraction of a day resulting from the calculation should be counted as a full day’s leave. After consultation with his employer, the employee may opt to take the pro rata annual leave accrued preceding the commencement of the common leave year or carry it forward and combine it with his leave accrued in the next leave year.

We have seen that some companies use the common leave year as the annual leave cycle. There are two common types:

Calendar year: Jan 1st – Dec 31st
Financial year: Apr 1st – Mar 31st

That is, no matter what is the join date of the employee, his annual leave should be calculated based on the day that employer specifies and should be calculated pro rata. In this case, the first year’s annual leave is different because of different join dates.

【Example】
Common leave year: Jan 1st – Dec 31st, 2022
Commencement date of employment: Oct 1st, 2022
Pro rata annual leave: 92* ÷ 365 × 7= 1.76 days (round up to 2 days)
(* 92 is the number of days between Oct 1st and Dec 31st.)
The employee may take the 2 days’ leave in 2022, or combine it with his 7
days’ leave accrued in 2023 and take 10 days’ leave in 2023

Read more: Ultimate Guide: Common Leave Year & Calendar Year Basis

## Workstem

Workstem supports employers to customise leave types and leave policies so as to meet the various needs of enterprises

Through the Workstem One App, employees can self-check their leave balance and submit leave applications; supervisors or HR can approve them anytime, anywhere, without any document being missed.

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