Dear Partner,
Along with leave accrual, there are specifications on how many leaves are bound to lapse by the end of the year and also on how many can be carried over to the next calendar year.
An example can be a case where out of 22 annually accrued leaves, only 8 leaves can be carried over to the next year, whereas the rest of the leaves lapse. The ratio can vary from company to company as per the laws of the state.
In your case here, the way the system works is that it would deduct the leaves for 30th and 31st Dec from your 2022 balance, and for the leaves applied for 2023, it would first check if you have accrued 5 leaves in 2023. This naturally would not be the case, as the year has just started. So, seeing that there are no leaves accrued in 2023, the next option for the system would be to check on whether any carry-over has been allowed from 2022, and then apply those leaves.
In the rarest of the rare scenarios where there is a 100% lapse by the end of the year, the system either applies LOP for the 2023 duration or gives you an option for advance leaves. If these options are not possible, then there is a case where an extended period of 30 days or up to 90 days is given in 2023 for exhausting the 2022 leaves. In such scenarios, the 2022 leave balance shall be deducted for all the applied leaves here.