Casual leave policy template
Copy the text below and replace everything in square brackets with your company details.
1. Purpose
This policy sets out the entitlement to casual leave at [Company Name] and the rules for using it, so that employees can handle short personal needs without disturbing planned work.
2. Scope
It applies to all employees, including probationers. Fixed-term employees receive casual leave in proportion to the length of their contract within the leave year.
3. Entitlement
- Each employee receives [12] days of casual leave in a leave year, not less than any minimum in the Shops and Establishments rules of [State].
- Casual leave is credited at [1 day at the start of every month].
- Employees joining mid-year receive casual leave only for the remaining months of the year.
4. Using casual leave
- Casual leave may be taken for up to [3] consecutive days at a time.
- It may be taken as a half day for the first or second half of the working day.
- Where possible, the employee applies [1] working day ahead. In an emergency, the employee tells the manager before [10:00 am] and applies on return.
- Casual leave cannot be joined to earned leave to create a longer break without the department head's approval.
- The balance may go up to [2] days below zero, recovered from the next credits.
5. Lapse and encashment
- Unused casual leave lapses at the end of the leave year and is not carried forward.
- Casual leave is not encashed during service or at exit.
- If an employee leaves with a negative casual leave balance, the excess days are treated as leave without pay in the full and final settlement.
6. Weekly offs and holidays
Weekly offs and holidays inside or next to casual leave are counted under the Sandwich leave policy, which sets out when such days are charged as leave.
7. Misuse
Casual leave taken repeatedly on Mondays, Fridays or days next to holidays may be discussed with the employee. Casual leave taken without telling the manager is treated as unauthorised absence.
8. Responsibilities
- Employees: use casual leave for genuine short needs and inform the manager early.
- Managers: approve reasonable requests promptly and raise patterns of misuse with HR.
- HR: credit casual leave, apply the year-end lapse and answer balance queries.
9. Review
HR reviews the casual leave entitlement at the end of each leave year, and whenever [State] revises its Shops and Establishments rules.
What to include
The purpose of CL
Describe casual leave as leave for short, unplanned personal needs. Stating the purpose gives managers a basis to refuse CL as a substitute for a two-week vacation.
Maximum spell
Limit how many consecutive days of CL can be taken, usually a small number such as three. Longer absences should come from earned leave, which is designed for planned breaks.
Monthly or upfront credit
Choose between crediting CL at the start of the year and crediting it monthly. Monthly credit avoids a new employee using a full year's CL in the first month and then resigning.
Lapse at year end
Say that unused CL lapses and is not encashed, if that is your rule. Employees should not be surprised in January, and payroll should never be asked to encash CL at exit.
State minimums
Your state's Shops and Establishments rules may set a minimum number of casual leave days. Check them before fixing the number and keep your entitlement at or above it.
Common mistakes to avoid
- Allowing CL to be joined with earned leave for long holidays, which defeats its purpose.
- Crediting a full year's CL on the joining day of a new employee.
- Encashing CL at exit when the policy says it lapses.
- Setting CL below the minimum in your state's Shops and Establishments rules.
- Refusing a genuine emergency CL because it was not applied for a day ahead.
Run it in ZeniaHR
Casual leave is one of the default leave types in the ZeniaHR Leave Ledger, credited at 1 day a month by default with pro rata for joiners and leavers. The leave rules for CL can set notice, maximum days per spell, half days, whether it is allowed in probation, how far below zero it may go and which leave types it cannot be combined with. Employees see their CL balance and a live preview of the days charged before they apply.
See it on your own data
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Book a free demoSee pricingFrequently asked questions
How many casual leaves are allowed in a year in India?
There is no single national number. Your state's Shops and Establishments rules may set a minimum for your establishment, and employers can give more. Check the state rules first, then fix a yearly number and state it in the policy, for example 12 days credited at one day a month.
Can casual leave be carried forward?
Usually not. Casual leave is meant for short needs within the year, so policies commonly let unused CL lapse at the end of the leave year and do not encash it. If you choose to allow carry forward, cap it and state the rule, but keep earned leave as the leave that accumulates.
Can casual leave be combined with other leave?
It depends on your policy. A common rule bars joining casual leave with earned leave, because CL is meant for short, unplanned needs rather than long holidays. If you allow it, add an approval step, such as the department head, so that long breaks are still planned properly.
Is casual leave available during probation?
Yes, if your policy allows it, and it usually should. Casual leave covers small unplanned needs that probationers have too, so allowing it from the first month, credited monthly, is sensible. Earned leave builds up more slowly and follows its own eligibility rules.