Most companies have policies and programs in place to address when employees need time away from work, and it’s often referred to as a company’s leave management process.
Employees feel like they are working more hours these days, and the unused number of vacation hours is telling of this. In fact, 768 million vacation days went unused, totaling around $65.5 billion in lost benefits to employees, according to research from the U.S. Travel Association.
A balance between work and personal life is important for many reasons, including helping employees avoid burnout and supporting productivity. This is where a company’s employee leave management process can help enhance an employee’s experience and promote wellbeing.
Leave management is the process a company implements to manage employee time-off requests. This includes various forms of time off, such as paid time off (PTO), sick or vacation days, bereavement, personal, military, educational, parental, FMLA, and unplanned leave.
Companies manage this process by implementing policies and procedures. The ultimate goal of a company’s leave management process is to allow for time off needs while minimizing disruption to the workforce — all while remaining in compliance with applicable laws and regulations.
Although leave management can be handled manually, going electronic is no exception when it comes to this process. According to a Facts and Factors market research report, the global absence leave management software market will grow by 9.3% from 2020 to 2026, reaching a staggering USD 0.95 billion!
The terms leave management and absence management are often used interchangeably because they have many similarities; however, there are a few differences between the two, as noted in the table below.
Leave management Absence managementLeaves are typically longer than 1 or 2 days.
Can refer to infrequent or non-consecutive time off, whether planned or unplanned. These types of absences are typically not covered under an employment law, such as FMLA. Excessive absenteeism, particularly unexcused absenteeism, can become attendance and performance management issues.
Extended time away from work (more than 3 days) may require supporting documentation.
May not require documentation (such as a doctor’s note, etc.) if the absence is just a day or two.
Often has a start and end date.
May not have a known or pre-determined start or end date.
Usually has a formal request and approval process.
May not require a formal or extensive request and approval process.
On the flip side, challenges can present themselves in the process, such as:
As a first step, the company needs to develop a strategy and goal for the employee leave management process. This applies to an organization that wants to either implement an initial process or enhance or update a current leave management process.
Understanding the legal requirements that apply to the organization is a critical component of a leave management process. Laws can differ by location, size of company, and industry.
A clear knowledge of applicable laws and their requirements will help the company remain compliant and minimize legal risks, such as employee disputes or grievances.
Well-defined leave policies will help ensure a uniform process. These policies and procedures should be reviewed on a regular basis. Changes in laws, the size of the workforce, and other business drivers may warrant policy changes and updates.
Before an LMS is rolled out, a testing period, training, and communication initiative will be necessary to help ensure a smooth and organized implementation.
There are many leave management software providers available. The best systems offer all the tools needed to support the company’s goals and handle and manage leave requests while being cost-effective. According to Forbes, below is a list of 5 of the best leave management software products in 2024.
| Name | Target businesses | Key functionality |
| Calamari | Best overall for multinational leave management | Software is customizable by country. |
| Timetastic | Best for charities and certified B corporations (B-corps) | Dedication to helping unemployed women get back to work by providing them with interview coaching and other interview necessities. In addition to its own dedication to charity and corporate citizenship causes, it offers a 50% discount to all charities and certified B-corps dedicated to social responsibility, transparency, and accountability. |
| Absence.io | Best for midsized and multilingual companies | Offers several different packages with varying functionality. The leave management tools are in seven languages. |
| Kissflow | Best for large businesses | Interactive reporting offers in-depth insights into leave trends. Automatic validations, enterprise-grade calculations of accruals and leave balances, balance updates, and reporting make recording, monitoring, and managing large-volume leave requests instantly. Integrations with other business systems. |
| Vacation Tracker | Best for customizable leave management | Helps its users meet their environmental-friendly goals. For every 100 leave requests, Vacation Tracker plants one tree. |
Include a small group of managers from different departments in the new LMS user testing process. This will help get broad input into the process and will also help managers gain a better understanding and “hands-on” experience of how the leave process works.
Employee leave management is crucial in keeping a department running smoothly. It allows for properly managing staffing levels and legal compliance. While leave management can be handled manually, leave management software is commonly used as it automates the process and keeps the process consistent.
The ability to take time away from work is an essential part of an employee’s wellbeing. It’s in the company’s best interest to make employee leave management a positive experience, as it helps employees when they need it most.
