Core Entities
LeaveType: (leave_type_id, name, accrual_rate_days_per_month, max_balance_days, carry_over_max_days, is_paid, requires_documentation). Examples: Annual Leave (1.67 days/month, max 30 days), Sick Leave (1 day/month, no carry-over), Parental Leave (fixed 90 days, requires HR approval). LeaveBalance: (employee_id, leave_type_id, balance_days, accrued_ytd, used_ytd, carry_over_days). LeaveRequest: (request_id, employee_id, leave_type_id, start_date, end_date, days_requested, status, reason, document_url, approved_by, approved_at). LeaveTransaction: audit log of every balance change (accrual, request approval, cancellation, adjustment).
Accrual Engine
Accrual runs on a schedule (monthly or bi-weekly) and credits leave balances. Calculation: days_to_accrue = leave_type.accrual_rate * (days_in_period / 30). Cap at max_balance: new_balance = min(current_balance + days_to_accrue, leave_type.max_balance_days). Write both a balance update and a LeaveTransaction record (type=ACCRUAL, amount=days_accrued, date=NOW()). Proration: employees who join mid-month accrue proportionally for the days worked. Employees on unpaid leave may not accrue (depends on policy). Run accrual as an idempotent batch job: check if an ACCRUAL transaction already exists for this employee + period before crediting.
Leave Request and Approval Workflow
On request submission: validate balance (balance_days >= days_requested). Check for conflicts: are there other approved requests overlapping the same dates? Notify the manager. Manager actions: APPROVE or REJECT with a reason. Multi-level approval for long absences (> 10 days: requires HR approval after manager). On approval: deduct days from balance (balance_days -= days_requested), add DEDUCTION transaction. On rejection: no balance change. Cancellation: if approved leave is canceled before start_date: credit balance back (CREDIT transaction). If canceled mid-leave: credit remaining days. Cancellations require manager approval for completed days.
Balance Calculation
Balance must be accurate in real time. Compute from transactions (event sourcing approach): available_balance = SUM(transactions WHERE type IN (ACCRUAL, CARRY_OVER, ADJUSTMENT, CANCELLATION_CREDIT)) – SUM(transactions WHERE type IN (DEDUCTION)). This is always consistent even if a scheduled job misruns. Store a denormalized current balance for fast reads, but recompute from transactions for audits. Negative balance: some policies allow going negative (borrowing future accruals). Cap negative balance at -(3 months of accrual). Track separately from positive balance.
Year-End Carry-Over
At fiscal year end: for each employee, calculate carry_over = min(balance_days, leave_type.carry_over_max_days). Set new balance = carry_over. Record YEAR_END_RESET and CARRY_OVER transactions. Expiration: carry-over days must be used within Q1 of the new year or they expire (EXPIRY transaction). Send email reminders 30 days before expiration. Some policies: no carry-over at all (use-it-or-lose-it). Others: unlimited carry-over. Encode in LeaveType.carry_over_max_days (0 = no carry-over, NULL = unlimited).
Compliance and Reporting
Compliance: minimum leave mandates vary by jurisdiction (EU: 20 days/year minimum; US: no federal minimum). Store jurisdiction on the employee record and apply jurisdiction-specific rules. Mandatory leave: certain leave types cannot be denied (FMLA in the US, maternity/paternity in the EU). Reports: leave balance report (current balances by employee and type), leave utilization report (days taken per type, by department, by month), absenteeism report (sick leave trends), pending requests report (manager action required). All reports query the LeaveTransaction history for accuracy.
Interview Tips
- Model all balance changes as transactions, not direct balance updates. This provides a full audit trail and allows recomputing the balance from scratch if needed.
- Date arithmetic for leave: use business days (exclude weekends and public holidays) for most leave types. Store a PublicHoliday table per region. days_requested = count(business_days BETWEEN start_date AND end_date).
- State machine for requests: PENDING -> APPROVED -> TAKEN (after start_date). PENDING -> REJECTED. APPROVED -> CANCELED.
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