HR sets time off in three screens under **Leaves**: **Leave Type**, **Leave Policy**, and **Policy Assignment**. A type is the name of the time, such as vacation. A policy says how many days that type grants and whether requests need approval. An assignment gives that policy to one employee for a date range.

Employees request time from the types on the policy assigned to them. A type that is not on that policy cannot be requested. The message is **This leave type is not included in the employee's assigned policy.**

## Add a leave type

1. Open **Leaves**, then **Leave Type**.
2. Choose **New Leave Type**.
3. Enter **Leave Type Name**. **Code** and **Max Leaves Allowed** are optional.
4. Set the rules you need, then choose **Create Leave Type**.

Useful rules on the form:

- **Policy kind** can be **Accruing**, **Unlimited**, or **Manual**. Unlimited time shows as **Unlimited** on the employee’s balances and on **PTO Report**.
- **Is Leave Without Pay** and **Allow Negative Balance** still allow a request when the day balance is zero.
- **Allow Carry Forward** lets unused time move forward, up to the policy’s carry-forward limit.
- **Include Holidays** counts holidays inside the request as time off.
- **Allow Encashment** allows a cash-out of unused time.
- **Pay out unused time when employment ends** marks unused time to be paid when the person leaves.
- **Hide the type on the team calendar** keeps that type off the shared calendar.
- **Protected hours** caps how many hours of this type can be used.
- **Active** leaves the type available. Turn it off when you want new requests to stop using it.

The list columns are **Name**, **Code**, **Max Leaves**, and **Active**. Search says **Search leave types...** An empty list says **No leave types yet** and **Set up sick, casual, and other leave categories your policy uses.**

**Leave Type Name** is required. If it is empty, the notice says **Leave Type Name is required**, and the type is not created.

## Write the policy

1. Open **Leaves**, then **Leave Policy**.
2. Choose **New Leave Policy**.
3. Enter **Policy name**.
4. Choose an **Accrual schedule**: **Annual**, **Monthly**, **Per Pay Period**, **Hours Worked**, or **Manual**. **Manual** does not add days on a schedule. Record those days on **Leave Allocation**.
5. Set **Carry-forward limit (days)**. Zero means nothing carries forward from the limit on this policy.
6. Leave **Requests require approval** on when a manager should decide each request. Turn it off when a valid request should be approved as soon as it is sent.
7. Leave **Active** on.
8. Under **Leave Allocations**, the table is labeled **Leave Policy Details**. Choose **Add Row**. Pick a **Leave Type** and an **Annual Allocation**. Both are required on the row.
9. Choose **Create Leave Policy**.

You should see **Leave Policy created**, and the policy opens with the **Policy name** you entered. The list of policies shows **Title**. An empty list says **No leave policies yet** and **Configure leave rules, accruals, and entitlements for your workforce.**

If **Policy name** or **Accrual schedule** is empty, the notice names the missing field and says it is required. The policy is not created. A table with no rows shows **No rows yet**. You can still create the policy, and employees on it will not have a type they can request until you add a row and save again.

Open the policy later and choose **Save** after you change the schedule, the limit, approval, or the allocation rows. You should see **Changes saved**. Choosing **Save** with no edits shows **No changes to save**. If the save fails, the notice is **Failed to save** and the form says **Save failed. Your edits are still here.** When the name does not reach the server, the message is **Title is required**.

## Assign the policy

1. Open **Leaves**, then **Policy Assignment**. The list title is **Leave Policy Assignments**.
2. Choose **New Leave Policy Assignment**.
3. Choose the **Employee** and the **Leave Policy**. Both are required.
4. Set **Assignment Based On** to **Leave Period** or **Joining Date**.
5. Enter **Effective From** and **Effective To**. Both are required.
6. Turn on **Carry Forward Unused Leaves** when unused days should carry into the next period, still limited by the policy’s carry-forward limit.
7. Choose **Create Leave Policy Assignment**. You should see **Leave Policy Assignment created**.

The list shows **Employee**, **Policy**, **From**, and **To**. Search says **Search policy assignments...** An empty list says **No leave policy assignments yet** and **Map leave policies to employees or groups.**

A missing **Employee**, **Leave Policy**, **Effective From**, or **Effective To** is named in the notice and the assignment is not created. Another save failure says **Failed to save**. Leave types use the same pattern: **Create Leave Type** shows **Leave Type created**, and a missing **Leave Type Name** is named as required.

After the assignment is in place, granted days show on **Leave Allocation** and **Leave Ledger** as they are posted. **Hours Worked** uses **Hours worked for each hour accrued** on the leave type.

## Next

Employees send requests from the assigned type. See [Request time off](/hrms/leaves/leave-application). To read remaining days, open [Time off balances](/hrms/leaves/leave-allocation).