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Table of Contents
Introduction
Indigo lets you categorise 🏷️ and organise 🗂️ your leave in two ways: using Leave Types and Leave Groups.
Leave Types are like labels used when generating Leave Entitlement for your employees. (e.g. VAC24, VAC25, SFP25 etc.)
They can be accessed by clicking on Leave Types in the Payroll & Leave tab.
Leave Groups are general categories available by default in Indigo. Each one collects a chosen list of Leave Types for which you can set a specific Priority Order. They work as containers 🍱 to properly store and classify Leave Types.
Employees can pick either a Leave Type or a Leave Group when requesting leave. Indigo behaves differently depending on which one they select.
Prerequisites
Once configured, Leave Types have to be added to Leave Entitlement Profiles. The goal is to have Leave Types showing when requesting leave.
Follow the steps in the article linked above.☝️
Ensure that the 'Can request this leave' checkbox is ticked.
Then go to the Employees' Profiles and assign the Leave Entitlement Profile. Tick the Can apply for leave checkbox too, if you want them to independently request their own leave.
The Leave Types for vacation, sick, and sick full pay are automatically updated in Indigo by Shireburn staff every year, using the standard values announced by the government. This changes won't be mechanically reflected in the Employees' Leave Entitlements, thus an hard push is needed to update the hours accordingly. 👉 To do that you can use the Global Leave Entitlement utility
Creating Leave Types
Go to Payroll & Leave > Leave Types.
To add a new Leave Type, click on the Insert ➕ icon in the top left of the screen.
An empty Leave Type form will show.
The page is divided into four collapsible sections:
Details
Details
Code: insert a unique reference code for the Leave Type.
Description: add a description if needed.
Leave group: it's set to Vacation by default and can't be left blank. Use it to categorise your Leave Type.
Rate: the rate the employee will get paid when using this leave type.
1: Normal Rate
0.5: Half Pay
0: Unpaid
2: Double Rate
Leave entry pay item: 👉 Create a Pay Item in Payroll & Leave > Payroll Setup > Pay Items, according to what you want shown in the Payslips when referring to leave. Once done, return to this field and select the newly created Pay Item from the dropdown. (See more about this in the green box.)
Public holiday leave: Select if Leave Type is for a public holiday
ESG Classification: Select a value to make sure this Leave Type will be properly considered in the ESG reporting.
🧠 Pro-Tip
Leave Types define from which 'entitlement bucket' the leave hours have to be deducted. (e.g. VAC24, VAC25, SFP25 etc.)
Pay Items (whose Payment type is Leave Pay) define how the payments for those leave hours need to be shown in the payslip.
Since Leave Types can refer to several types of leaves—vacation, sick, maternity, unpaid, etc.—you may also want to match payments with each type of leave entry (using Pay Items), and suitably display them in payslips.
To achieve that you can create a Pay Item per Leave Type. Refer to the example below for a better understanding.
Click me, I'm the Example🙋
Click me, I'm the Example🙋
Laura requested leave on December 2024. She took leave from VAC24 and some from the UNPAID Leave Types.
Let's see how to set up these Leave Types along with their Pay Items for employees like Laura.
VAC24
Create a Pay Item—set the Description as e.g. Leave Pay—with a Payment type set as Leave Pay, the Rate set as 1, and assign it to the VAC24 Leave Type using the Leave entry pay item dropdown.
UNPAID
Create a Pay Item—set the Description as e.g. Unpaid Leave—with a Payment type set as Leave Pay, the Rate set as 0, and assign it to the Unpaid Leave Leave Type using the Leave entry pay item dropdown.
👀 Please note that when creating a Pay Item referring to leave (regardless which type), the Payment type value has to be Leave Pay. The Payment type works as a general category to gather all the Pay Items related to leaves.
When running the December 2024 payroll for Laura, the payslip will show her leave and their related payments properly categorised, thanks to the Pay Items we attached to the Leave Types used to request leave.
Understand the 'why' 🤔
Understand the 'why' 🤔
Indigo needs to involve different sections in order to calculate the employees' payslips properly.
It draws details from the HR module in the Employee profiles (such as but not limited to the selected Tax Profile, the Basic Pay, the Leave Entitlement Profile etc.).
It matches them and perform calculations according to Leave Types and Pay Items in the leave requests, which are part of another module, the Payroll & Leave.
It keeps gathering relevant data across Indigo, till it's ready to execute the expected computing.
To speed up ☄️ this process we have to create connections 🕸️ between the different elements within the system.
A good example is that it's mandatory to assign a Pay Item to Leave Types. By doing so the Leave section and the Payroll section are 'linked', allowing Indigo to easily extract the needed info. The payroll process can then be accurately run to display data in the right way.
Entitlement
Entitlement
No need to specify ent.: select it whether the employer doesn't need to specify entitlement for this Leave Type. Once ticked there will be an unlimited entitlement for that specific Leave Type.
Ent. with new employment: how Leave Entitlement will be allocated automatically when creating a new employee.
None: no Auto Entitlement will be given.
Pro Rata: recommended only for current year leave. Entitlement will be given pro rata on employment date depending what is set in the Leave Entitlement Profile Hours.
Full: entitlement will be given in Full depending what is set in the Leave Entitlement Profile Hours.
Pay Off
Pay Off
Pay off on term.: how Leave Balance will be Paid Off when terminating an employee.
None: no Auto Pay off will be given.
Pro-rata: recommended only for current year leave. Pay Off will be given pro rata on termination date date depending what is set in the Leave Entitlement Profile Hours.
Full balance: all remaining balance will be paid off on termination.
Pay off pay item: create an Adjustment Pay Item with a Contribution payment basis to be used by the system when creating the pay off entry.
Posting Dates
Posting Dates
Allow post from: leave is available as of this date.
Allow post to: leave is available until this date.
Can Request From: leave can be requested as of this date.
Can Request To: leave can be requested until this date.
You can also use Posting Dates to carry forward the leave balance to the new payroll year.
Fill in the fields as needed, and click on Save ✔️ on the left of the tool bar.
Leave Type Priorities Inside Leave Groups
After creating Leave Types, each type will automatically be given a higher priority in terms of leave hours consumption. However, there may be cases that need this amended. Check the example below.
Example
Example
When the new year is about to start, a new Leave Type (e.g. VAC26) is generally created, and it automatically covers the first place of the Leave Group list (e.g. Vacation). However, let's assume that the leave from the previous year (e.g. VAC25) can be carried forward and need to be consumed before the newer ones. Therefore VAC25 needs to have an higher priority compared to VAC26 in the Vacation Leave Group list, otherwise the leave hours will be deducted inaccurately.
To set up the proper priority order, navigate to Payroll and Leave > Leave > Leave Type Priorities.
You can also go to Payroll & Leave > Leave Types and click on the last icon 🔀 on the right in the tool bar.
Both methods will bring you to the Leave Type Priorities screen 👇.
To manage the Leave Type order in a Leave Group:
Use the arrows on the far right to move the record one line up 🔼 or down 🔽.
Drag and drop the Leave Type to the desired position.
After changing the Leave Type Priorities, click on the Apply Priority Order button at the bottom right to confirm your changes.
To reset the priority orders to default, click on Clear Priority Orders on the bottom left of the screen.
Leave Types vs. Leave Groups in Leave Requests
When requesting Leave you can either select a Leave Group or a Leave type. Depending on the one you choose, the other option will be greyed out.
So what is the difference when selecting one or the other 🤔?
Let's say that the Leave Group Vacation contains the Leave Types in the following priority order:
When you select the Vacation Leave Group, the system will automatically scan the list of Leave Types within the group itself. It will then deduct leave starting from VAC23 and continue to VAC24 and beyond (following the Leave Type Priorities order), once the respective balances are fully consumed.
On the other hand, if you decide to specifically select a Leave Type from the designated field (e.g.VAC23)—and there are not enough days available in this Leave Type—the system will prevent you from submitting the leave request and display an error message.
In this case, check the remaining days for each Leave Type in advance to submit your leave requests as smoothly as possible.
💡 Tip: Did you know you can stop the Working Remotely leave group from showing in the dropdown when applying for leave?
Simply do not select the Working Remotely leave group when creating or amending a leave type.
⚠️ This only applies to the Working Remotely leave group.
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