As an employer, it's important to understand prorated leave and its application in different scenarios to maintain fairness and HR compliance in the workplace. Dive into our comprehensive guide to discover your employees' eligibility and entitlements to different types of prorated leave in Singapore!
What is prorated leave?
Prorated leave refers to the proportionate allocation of leave entitlement for employees based on the proportion of time they have worked at the company.
This system allows a fair distribution of leave days and avoids scenarios where those joining or departing mid-year are treated the same as those working the full year. Prorating leave days promotes equity among employees, ensures legal compliance, and contributes to employee satisfaction and engagement.
How is prorated annual leave calculated?
Duration of employment
Prorated annual leave
3 to 12 months
Based on the number of completed months the employee has worked. This applies even if the employee is still on probation.
More than a year
Based on the number of completed months the employee worked in the current year.
Annual leave is prorated using this formula:
(Number of completed months of service ÷ 12 months) × Number of days of annual leave entitlement
Note:
If the computed figure is less than 0.5, it is rounded down.
If it is 0.5 or more, it is rounded up to one day.
Example 1: Calculate the number of completed months of service
If the employee started working on 1 January 2023 and left service on 15 August 2023, he/she served for 7 completed months of service. The period from 1 to 15 August is disregarded as it is not a completed month.
Example 2: Calculate the prorated annual leave
Following the above example, if his/her annual leave entitlement is 20 days, he/she is entitled to:
(7 completed months of service ÷ 12 months) x 20 days of annual leave entitlement = 12 days (rounded up to one day)
How are prorated sick and hospitalisation leave calculated?
An employee is entitled to a full 14 days of paid sick leave and 60 days of paid hospitalisation leave once he or she has worked for 6 months or more.
Do note that 14 days of paid sick leave entitlement are included in 60 days of paid hospitalisation leave.
A new employee must have worked for at least 3 months to be entitled to paid sick leave or paid hospitalisation leave. The month of service begins on the day the employee starts working with the employer. Paid sick and hospitalisation leave are prorated as follows:
Employees can get prorated childcare leave if they have worked less than a year or if they plan to leave their employer this year.
For employees working less than a year:
The number of childcare leave days is prorated based on his or her employment duration.
Completed months of employment
Eligible days of childcare leave
0-2 months
Not eligible
3-4 months
2
5-6 months
3
7-8 months
4
9-10 months
5
11-12 months
6
For employees leaving their job:
If the employee has worked for at least 3 months before leaving, his or her childcare leave will be prorated based on the number of completed months of service in the year of resignation or termination.
Completed months of employment in the year of resignation or termination
Working parents in Singapore are entitled to an annual allocation of 2 days of extended childcare leave if they fulfil the following criteria:
Their youngest child is between 7 and 12 years old, both inclusive.
Their child is a Singapore citizen.
They must have completed at least 3 months of employment with the organisation.
This also applies to employees who are adoptive parents or step-parents, as long as they fulfil the above criteria.
The government covers the cost of these 2 days, up to a maximum of $500 per day, inclusive of CPF contributions. However, extended childcare leave is not prorated.
According to the Ministry of Manpower (MOM), there is no prorated maternity leave. Employees who are working mothers may be eligible for either 16 weeks or 12 weeks of maternity leave, depending on them fulfilling certain criteria.
To qualify for the full 16 weeks of maternity leave, your employee must meet the following conditions:
She must have completed at least 3 continuous months of service with your company before her child's birth.
Her child must be a Singapore citizen.
The child must be born or have an estimated delivery date on or after 1 January 2017.
Notes:
If an employee hasn't worked at the company for at least 3 months, she will only be eligible for 12 weeks of unpaid maternity leave.
If the child is not a Singapore citizen, she will only be eligible for 12 weeks of maternity leave.
If an employee is not lawfully married to the child's father, she will still be eligible for 16 weeks of maternity leave.
Tip: Read more on maternity leave to get ideas on how to best support your employees as they transit into parenthood.
Simplify prorated leave calculation with Payboy’s leave management system!
Small and medium-sized enterprises (SMEs) often find leave management to be a pain point, and we can understand why:
SMEs don’t have as many HR resources as larger businesses. As a result, they often have to rely on manual leave processes, which can be both time-consuming and error-prone.
SMEs often have a more limited pool of employees to choose from when someone goes on leave. This can lead to disruptions in workflow and decreased productivity.
If leave isn't managed properly, it can have a negative impact on productivity and morale. Therefore, good HR software is an essential tool for any business that wants to stay on top of its leave entitlements and ensure its employees are getting the rest they deserve.
Here are some benefits of using our leave management module!
Manage leaves digitally
Our leave management module is designed to streamline the leave management process, making it easy for employees to apply for leave and check leave balances, as well as for employers to approve and manage leave requests.
Employees can also easily submit supporting documents or certificates via the mobile app, so that all the documents are stored in a central database. No more missing documents!
Sync seamlessly with Shift Scheduling and Payroll Processing modules
Shift scheduling and payroll calculation can be time-consuming and stressful while you are managing different leave types and requests. With Payboy HR software, when leaves are approved, the employee’s availability will be automatically updated in the Shift Scheduling module, and any encashed or unpaid leave will be calculated in the Payroll Processing module.
Customise the leave policy that best fits your business needs
We'll provide you with a MOM-compliant setup to start with, but we are also ready to assist you in customising your leave policy to fit your business requirements. Check out how to customise settings for each leave type with Payboy!
Our Payboy Support Centre also helps to address most of the FAQs regarding other statutory leave entitlements asked by our customers:
Reach out to us if you are keen for a free demo on how we can help you save hours and give you some peace of mind on payroll and other HR matters so that you can focus on your business and people.
