Leave, Which Is Knowable
The one deduction that can be known rather than estimated, the three ways plans get it wrong anyway, and what to do about leave that has not been booked yet.
Annual leave is the only large deduction in a capacity account that can be known rather than estimated. The entitlement is contractual, the bookings are in a system, and the balance is arithmetic.
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Plans still get it wrong, in three specific ways, and each of them is avoidable with a query somebody can write in ten minutes.
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The first error: counting only what is booked
Booked leave is a lower bound. The entitlement is the real number, and the difference between them is leave that will be taken, probably at the least convenient moment, because unbooked leave does not evaporate.
A plan that counts only bookings is optimistic by exactly the unbooked balance, and the error grows through the year until it collapses in the final quarter.
The second error: the wrong period
Leave years and planning periods rarely align. A team with a leave year ending in March and a plan running to December is carrying two different balances, and the one that matters is the one inside the plan's window.
Pro-rating entitlement across the planning period, rather than using the annual figure, is the fix and it is one formula.
The third error: averaging across people
Leave is not evenly distributed. Two people booking the same fortnight in August is a capacity event; the quarterly average says nothing about it.
For a quarter, the average is adequate. For a month or a sprint, the distribution is the whole answer, and a plan at that granularity needs the calendar rather than the total.
The last-quarter problem
Unbooked leave accumulates and has to be taken before the leave year ends, which means the final quarter of any leave year carries a larger deduction than the others — frequently much larger.
Any plan that applies a flat quarterly leave figure will be right three times and badly wrong once. Reading the balance rather than the average is a five-minute correction.
Carry-over, which is capacity borrowed from last year
Where carry-over is permitted, the leave belongs to a year that has closed and consumes capacity in a year that has not. It is an opening liability in the capacity account.
Whatever the local rules on carry-over, the planning consequence is simple: the balance is the balance, and it has to be taken somewhere inside the plan.
Public holidays, which are easier and still missed
Fixed, known a year ahead, different by country and sometimes by site, and routinely omitted from plans built from a generic weekly figure.
A multi-country team has different available hours per country, for this reason alone, and a single blended figure will be wrong for every individual in it.
The query worth writing once
For each person in the period: entitlement pro-rated to the window, less leave already taken in the window, less leave booked in the window, equals leave still to be taken.
Summed across the team, that is the deduction. It is a single query against the leave system and it replaces an estimate that is wrong by a predictable amount every year.
Leave and the individual
A capacity account needs the team total; it does not need to publish who is away when, beyond what the rota already shows.
Keeping the aggregate in the plan and the detail in the leave system is both better practice and easier, because the plan then does not have to be updated every time somebody books a day.
What to tell people about it
That leave is planned in rather than planned around. Teams whose leave is treated as an obstacle learn to book late, which makes the plan worse and the team unhappier.
A plan that visibly contains the full entitlement, taken by somebody at some point, is one people can book against freely — and free booking is what makes the distribution manageable.
The three numbers to hold
- Entitlement for the window, pro-rated from the leave year.
- Taken so far inside the window.
- Booked but not yet taken inside the window.
The deduction is the first minus the second, and the third is only useful for distribution. Plans that hold the third alone are the ones that fail in the last quarter.
The figure that should never appear
A plan that assumes leave will not be taken. It exists, it is usually implicit rather than stated, and it is a plan to have an argument in November.
If the plan only works when the entitlement is not used, the plan does not work, and saying so in the quarter it is written is considerably cheaper than discovering it in the quarter it fails.