Time Off Daily Proration: How Does It Work?

Overview:

This guide aims to explain the time off proration logic in Omni and how it works. Specifically, this article will focus on explaining how daily proration logic works with different proration settings. We have included examples to best illustrate how the system will behave depending on different settings.

Proration rules:

• Proration in the first period determines whether the entitled amount is granted fully or partially in the first period when the policy is first assigned to a user
• Proration in the last period determines whether the entitled amount is granted fully or partially in the last period when the policy is removed from a user
• Daily prorated in the first or last period means the user earns prorated number of days based on the number of days he works. It will be calculated based on calendar days

Example 1: 16 days should be awarded on January 1, and daily proration is in the first period. 

If a new hire joins on 15 January 2025, the accrual will be based on the number of days they will work in the calendar year. 

To calculate the accrual of leave in 2025:

• Number of days in period = Days between 15/01/2025 - 31/12/2025 = 351
• Number of days in policy year = Days between 01/01/2025 - 31/12/2025 = 365
• Amount granted= 351/365 x 16 = 15.39 days

Example 2: 16 days should be awarded on January 1, and daily proration is in the last period. 

If an employee started work on 1 January 2025, but has resigned and their last working day is on 16 March 2025. They would have been originally awarded 16 days, but the leave accrual would have reversed to below:

• Number of days in period = Days between 01/01/2025 - 16/03/2025 = 75
• Number of days in policy year = Days between 01/01/2025 - 31/12/2025 = 365
• Amount granted= 75/365 x 16 = 3.29 days

Example 3: 16 days should be awarded on January 1, and daily proration is in both periods.

If a new hire joins on 15 June 2024, but leaves on 15 June 2025, the accrual will be calculated as follows:

To calculate the accrual of leave in 2024:

• Number of days in period = Days between 15/06/2024 - 31/12/2024 = 200
• Number of days in policy year = Days between 01/01/2024 - 31/12/2024 = 366 (2024 is a leap year)
• Amount granted= 200/366 x 16 = 8.74 days

At the beginning of 2025, they would have been granted the full 16 days. However, when the employee resigns, the leave accrual will have reversed to:

• Number of days in period = Days between 01/01/2025 - 15/06/2025 = 166
• Number of days in policy year = Days between 01/01/2025 - 31/12/2025 = 365
• Amount granted= 166/365 x 16 = 7.28 days

Example 4: 16 days should be awarded on January 1, and daily proration is in both periods.

When an employee joins and leaves in the same period, and both first & last period are prorated daily, the system will count the accrual only for the period that the employee has worked for

If a new hire joins on 15 June 2025, the accrual will be calculated as follows:

To calculate the accrual of leave in 2025:

• Number of days in period = Days between 15/06/2025 - 31/12/2025 = 200
• Number of days in policy year = Days between 01/01/2025 - 31/12/2025 = 365
• Amount granted= 200/365 x 16 = 8.77 days

However, if the employee resigns and their last working day is on 15 Dec 2025, the leave accrual will then reverse to:

• Number of days in period = Days between 15/06/2025 - 15/12/2025 = 184
• Number of days in policy year = Days between 01/01/2025 - 31/12/2025 = 365
• Amount granted= 184/365 x 16 = 8.07 days

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