Compensatory Off — Define Comp Off Rules
What this tab does: Configure the compensatory leave/pay rules — how comp-off leaves are managed, including leave calendar, usage limits, sandwich rules, encashment, and separation policies.
When this tab appears: Only when at least one day type (Week Day, Week Off, or Holiday) is set to "Compensatory Off/Pay" as the compensation type. If all day types use "Overtime", this tab does not appear — the Overtime tab appears instead.
What You'll See
The tab heading reads "Compensatory Off — Manage compensatory leave". This is one of the most feature-rich tabs, with settings controlling the entire comp-off lifecycle: how they're earned, how they're used, when they expire, and what happens at separation.
First Choice: Compensation Sub-Type
🔀 Provide extra working compensation as
| Option | What It Means | Effect on Form |
|---|---|---|
| Compensatory Off | Employee earns leave credits — they can take time off later | Shows leave calendar, usage limits, and leave management fields |
| Compensatory Pay | Employee gets a monetary payment processed as comp pay | Shows payment basis fields (Fixed / % Of Basic / Gross / CTC) |
🔄 This choice dramatically changes the form below. See each variant documented separately.
Variant A: "Compensatory Off" Selected
This is the leave-based variant. The form shows comprehensive leave management settings.
📅 Leave Calendar
| Option | What It Means |
|---|---|
| Calendar (default, blue) | Leave year runs January to December |
| Financial | Leave year runs April to March |
A helper text below confirms: "January to December v/s April to March"
💡 Choose based on your organization's fiscal year. Indian companies typically use Financial (April-March).
📊 Employees can take
Controls the maximum comp-off leaves an employee can use within a period:
Period options: Monthly / Quarterly / Half Yearly / Yearly (default: Monthly)
Input: "maximum ___ leaves" — enter the cap number
Example: If Monthly and maximum = 2, an employee can take at most 2 comp-off leaves per month, even if they have more in their balance.
📏 Per transaction employees can use
Two inputs controlling leave request limits:
| Field | Purpose | Default |
|---|---|---|
| ___ minimum | Minimum comp-off leaves per single request | 0.5 |
| & ___ maximum leaves | Maximum comp-off leaves per single request | (empty) |
Example: If minimum = 0.5 and maximum = 2, an employee can apply for 0.5 (half day), 1, 1.5, or 2 comp-off days in a single leave request, but not more than 2 at once.
🔄 Same policy for all days (week day, week off, holiday)
A toggle switch (default: ON / blue)
| State | What It Means |
|---|---|
| ON | Same comp-off payment/rates for all day types |
| OFF | Separate payment settings per day type |
💵 Compensatory payment based on
Even though this is a "Compensatory Off" (leave-based), there may be a monetary component for encashment. Choose the basis:
| Option | Calculation Method |
|---|---|
| Fixed (default, blue) | Flat amount per half/full day |
| % Of Basic | Based on percentage of Basic salary |
| % Of Gross | Based on percentage of Gross salary |
| % Of CTC | Based on percentage of Cost to Company |
📊 Rate of payment for half day *
Enter the payment rate for a half-day comp-off. (A full-day rate is typically derived as double the half-day rate.)
📋 Show overtime payment in monthly payroll under
Select the pay element from the dropdown for payslip display.
🥪 Sandwich Leave Rules
These rules handle scenarios where comp-off leaves are taken adjacent to weekly offs or holidays:
Toggle 1: Applicable On "Leave - Week Off / Holiday - Leave"
Default: OFF
When ON: If an employee takes comp-off on Friday and Monday (with Saturday-Sunday as week offs in between), the system counts Saturday and Sunday as leave days too — the "sandwich" principle.
💡 Example: Employee takes comp-off Friday + Monday. With sandwich rule ON, Saturday and Sunday are also deducted as leave = 4 days total. With rule OFF = 2 days total.
Toggle 2: Applicable On "Week Off / Holiday - Leave - Week Off / Holiday"
Default: OFF
When ON: If a comp-off is taken on a day between two non-working days (e.g., Monday between Sunday week-off and Tuesday holiday), the surrounding non-working days may be counted.
⚠️ These rules can significantly impact leave balances. Discuss with your HR policy team before enabling.
💰 Encashable on separation
Default: OFF
When ON: If an employee leaves the organization (resignation, termination, etc.), their unused comp-off balance is converted to a monetary payment in their final settlement.
When OFF: Unused comp-offs are forfeited at separation.
🚫 Restrict employee to apply for Compensatory Off anytime
Default: OFF
When ON: Employees cannot freely apply for comp-off leaves at any time. Additional restrictions (such as applying within a certain window after earning the comp-off) may be enforced.
When OFF: Employees can apply for their earned comp-offs at any time, subject to manager approval.
Variant B: "Compensatory Pay" Selected
When "Compensatory Pay" is selected, the leave management fields disappear. The form shows monetary payment settings similar to the Overtime tab:
| Field | Purpose |
|---|---|
| Same policy for all days | Toggle — uniform or per-day-type settings |
| Compensatory payment based on | Fixed / % Of Basic / % Of Gross / % Of CTC |
| **Rate of payment for half day *** | Payment rate |
| Show overtime payment in monthly payroll under | Payroll element dropdown |
| Encashable on separation | Toggle for final settlement |
💡 Key difference from Variant A: No leave calendar, no usage limits, no sandwich rules, no per-transaction limits. It's purely a payment — not a leave type.
Action Buttons
| Button | Color | What It Does |
|---|---|---|
| Reset | Red | Clears all settings on this tab |
| Previous | Grey/Blue | Goes back to the previous tab |
| Next | Blue | Proceeds to the Who Gets It tab |
Step-by-Step: Setting Compensatory Off Rules
For Compensatory Off (leave-based):
- Select Compensatory Off
- Choose Leave Calendar — Calendar (Jan-Dec) or Financial (Apr-Mar)
- Set Employees can take — period (Monthly/Quarterly/etc.) and maximum leaves
- Set Per transaction limits — minimum and maximum per request
- Decide Same policy for all days — toggle ON or OFF
- Choose Compensatory payment based on — Fixed or percentage
- Enter Rate of payment for half day
- Select payroll element
- Configure Sandwich leave rules — enable/disable each toggle
- Set Encashable on separation — ON or OFF
- Set Restrict employee to apply — ON or OFF
- Click Next
For Compensatory Pay (payment-based):
- Select Compensatory Pay
- Decide Same policy for all days
- Choose payment basis and enter rate
- Select payroll element
- Set Encashable on separation
- Click Next
FAQs
Q: What's the difference between "Compensatory Off" and "Compensatory Pay"? A: Compensatory Off creates leave credits — the employee earns time off. Compensatory Pay is a monetary payment processed through payroll, similar to overtime but categorized differently for compliance purposes.
Q: Can I have Compensatory Off for Week Day but Compensatory Pay for Week Off? A: The sub-type (Off vs Pay) is configured at this tab level and applies based on the "Same policy for all days" toggle. If you need different sub-types per day, you may need separate policies.
Q: What are sandwich leave rules? A: They control whether non-working days (week offs, holidays) between or adjacent to comp-off leaves are counted as leave days. Enabling them increases the leave deduction for leave taken around weekends/holidays.
Q: Can employees see their comp-off balance? A: Yes, comp-off balances typically appear in the employee's Leave Balance section of the ESS portal, alongside other leave types.
Troubleshooting
| Problem | Possible Cause | Solution |
|---|---|---|
| "Leave Calendar" field not showing | "Compensatory Pay" is selected instead of "Compensatory Off" | Switch to "Compensatory Off" — leave calendar only applies to the leave variant |
| Payroll dropdown is empty | No comp-off pay elements configured | Create a compensatory pay element in Payroll Settings first |
| Sandwich leave rules not deducting correctly | Rules are toggled OFF | Enable the appropriate sandwich rule toggle(s) |
| Comp-off not encashed at separation | "Encashable on separation" is OFF | Turn the toggle ON for separation encashment |