In this article, we will go through the steps on how an admin can encash leaves for their employees on Asanify. Leave encashment allows you to convert employees' unused leave balances into monetary value and include the encashment amount in their payroll.
Prerequisites
Before you can encash leaves for your employees, ensure that:
You are logged in as an Admin (this feature is not available for HR admins)
Your employees have leave policies assigned with encashable leave types
Employees have sufficient leave balance to encash
You have set up the Payment per Day formula for leave encashment
Understanding Payment per Day Formulas
Before creating an encashment batch, you need to understand how the Payment per Day is calculated. Asanify allows you to configure formulas that determine the monetary value of each leave day.
The formula typically uses salary components like:
Basic Salary (e.g.,
basic)Dearness Allowance (e.g.,
da)Other components as configured in your salary structure
For example, a common formula is: (basic)/12/30 - which calculates the daily rate based on Basic divided by 30 days.
Step-by-step guide to encash leaves
Step 1: Navigate to Leave Encashment
From the Dashboard, click on the Leave dropdown in the left navigation bar
Click on Encashment
You will see the Leave Encashment page with two tables:
Batches: Shows all your existing encashment batches
Payment per Day: Shows the formulas configured for calculating encashment amounts
Step 2: Create a New Encashment Batch
Click on the + Create Batch button in the top right corner
A multi-step form will open to guide you through the encashment process
Step 3: Select Employees (Step 1 of 3)
In this step, you'll select which employees to include in the encashment batch:
Select Entity (if applicable): If your organization has multiple entities, select the relevant entity
Select Leave Policy: Choose the leave policy from which you want to encash leaves. Only policies with encashable leave types will appear here.
View Eligible Employees: The system will automatically load all employees who are:
Assigned to the selected leave policy
Have positive leave balance available for encashment
Have all required salary components configured
Select Employees: Check the boxes next to the employees you want to include in this encashment batch. You can use the search function to find specific employees.
Tip: Employees without proper salary component configuration will be shown with a warning indicator. You'll need to configure their salary structure before including them in the encashment.
Click Set Balances to proceed
Step 4: Set Encashable Balances (Step 2 of 3)
In this step, you'll specify how many days to encash for each employee:
For each selected employee, you'll see:
Employee Name: The employee's name
Available Balance: The current leave balance as of today
Encashable Balance: Enter the number of days you want to encash (must be less than or equal to available balance)
Payment per Day: The calculated amount per day based on the formula
Encashment Amount: Automatically calculated as Encashable Balance × Payment per Day
Enter the Encashable Balance for each employee. You can encash:
The full available balance, or
A partial amount (any number up to the available balance)
Review the Encashment Amount column to see the total payout for each employee
Click Next to proceed to the summary
Step 5: Review Summary (Step 3 of 3)
The summary page shows all the details of your encashment batch:
Batch Details:
Payroll Month for inclusion
Selected Leave Policy
Total number of employees
Employee-wise Breakdown:
Employee names
Days being encashed
Amount per employee
Total Encashment Amount: The sum of all encashment amounts
Review all details carefully, then click Save to create the batch
Success: Once saved, a green success message will appear confirming that the encashment batch has been created successfully.
Step 6: View and Manage Encashment Batches
After creating a batch, you can:
View Batch Details: Click on the View Details icon next to any batch to see:
Complete employee list with encashment amounts
Batch status
Associated payroll month
Export Data: Click on the Export CSV button to download the batch details as a CSV file
Track Status: Batches can have the following statuses:
Draft: Batch is created but not yet processed in payroll
Processed: Encashment amounts have been included in the payroll run
What happens after creating an encashment batch?
Leave Balance Deduction: The encashed days will be deducted from the employees' leave balance
Payroll Integration: When you run payroll for the selected month, the encashment amounts will automatically be added to the employees' earnings
Payslip Reflection: The encashment amount will appear as a separate line item on the employee's payslip
Managing Payment per Day Formulas
To view or manage the Payment per Day formulas:
Go to Leave > Encashment > Payment Per Day Formula Table
Here you can view the configured formulas that determine how much each leave day is worth
Note: If you need to modify the Payment per Day formula, please contact your system administrator or reach out to Asanify support.
Important Notes
Admin Only: Leave encashment is an admin-only feature. HR admins do not have access to this functionality.
Encashable Leave Types: Only leave types marked as "Encashable" in the leave policy can be encashed. To set up leave policies with encashable leave types, mark the "Encashable" option while creating or editing the policy.
Balance Calculation: The system calculates available balance based on the employee's leave balance as of today. If you need to view or edit leave balances before encashment, you can do so from the Leave Balances page.
Payroll Period: You can only create encashment batches for payroll periods that haven't been processed yet.
Multiple Batches: You can create multiple encashment batches for the same payroll period if needed.
Troubleshooting
Employee not appearing in the eligible list
If an employee is not appearing in the eligible employees list, check:
They are assigned to the selected leave policy
They have positive leave balance for the encashable leave type
Their salary structure includes all components required by the Payment per Day formula
They are an active employee (not terminated or on notice period)
Encashment amount showing as zero
If the encashment amount is showing as zero or incorrect:
Verify the Payment per Day formula is correctly configured
Check that the employee has the required salary components (e.g., Basic, DA)
Ensure the salary components have valid values
Cannot select a payroll month
If you cannot select a certain payroll month:
Payroll for that month may already be processed
The month may be outside the valid range for encashment
Need Help?
If you have any questions or need assistance with leave encashment, please reach out to us at support@asanify.com - we'd be happy to assist you.