How to Configure Time Off Types in Odoo 18: Complete Guide
By Braincuber Team
Published on March 14, 2026
Managing employee leave effectively requires not just flexibility but also compliance with organizational policies and regulatory requirements. With Odoo 18, the Time Off module introduces refined control mechanisms that let you define leave rules at a granular level. From setting up approval hierarchies to managing unpaid leaves and defining negative balances, everything can be configured precisely.
What You'll Learn:
- Understanding time off type configuration in Odoo 18
- Detailed explanation of all configuration fields
- Setting up paid time off types with proper workflows
- Configuring unpaid leave types and negative caps
- Approval hierarchy setup and notification management
- Payroll integration and work entry types
- Best practices for leave policy implementation
Accessing Time Off Type Configuration
To begin setting up a new time off type in Odoo 18, you need to navigate to the Time Off module's configuration section where you can create and customize leave categories according to your organization's policies.
Navigate to Time Off Configuration
Go to Time Off > Configuration > Time Off Types in the Odoo 18 menu structure.
Review Existing Types
You'll see a list of existing time off categories such as Sick Leave, Paid Leave, Compensatory Leave, etc.
Create New Time Off Type
Click New to define a new time off type or modify an existing entry to customize it according to your needs.
Detailed Field Explanation
Each field in the time off type configuration serves a specific purpose in defining how leave requests are processed and managed. Understanding these fields is crucial for implementing effective leave policies.
Display Name
The name given to the time off category, such as "Annual Leave," "Sick Leave," or "Unpaid Leave." This label appears throughout the interface.
Approval
Determines approval layers: No Validation, By Time Off Officer, By Employee's Approver, or Both for strict workflow compliance.
Requires Allocation
Defines if employees must have predefined leave balance before submitting requests. Yes for strict control, No Limit for flexibility.
Employee Requests
Controls if employees can request extra days beyond allocation. Extra Days Requests Allowed or Not Available for budget control.
| Field | Purpose | Impact |
|---|---|---|
| Notified Time Off Officer | Assigns HR personnel who receive notifications for leave requests | Ensures accountability and streamlines HR communication |
| Take Time Off In | Specifies leave duration: Full Day, Half Day, or Hours | Enables fine-grained leave entry for hourly employees |
| Public Holiday Included | Controls if holidays within leave period count as leave | Affects accurate leave consumption calculations |
| Show on Dashboard | Controls visibility on employee dashboard | Helps declutter dashboards while maintaining access |
| Kind of Time Off | Classifies as Working Time or Absence | Impacts payroll calculations and timesheet integration |
| Allow Negative Cap | Permits leave requests exceeding current balance | Useful for emergency leave situations |
| Maximum Excess Amount | Defines negative balance limit (e.g., -5 days) | Controls overdraft availability to employees |
Example: Configuring a Paid Time Off Type
Here's how to set up a standard Paid Time Off (PTO) with proper workflow controls and payroll integration:
Basic Configuration
Set Display Name to "Paid Time Off" and configure Approval as "By Employee's Approver and Time-Off Officer" for dual validation.
Work Entry Integration
Set Work Entry Type to "Paid Leave" to ensure proper integration with payroll and salary calculations.
Allocation and Requests
Set Requires Allocation to "Yes" and Employee Requests to "Extra Days Request Allowed" for balanced flexibility.
Final Settings
Enable Public Holiday Included, disable Allow Negative Cap, and enable Show on Dashboard for optimal user experience.
Configuration Fields:
• Display Name: Paid Time Off
• Approval: By Employee's Approver and Time-Off Officer
• Work Entry Type: Paid Leave (payroll integrated)
• Requires Allocation: Yes
• Employee Requests: Extra Days Request Allowed
• Public Holiday Included: Enabled
• Allow Negative Cap: Disabled
• Show on Dashboard: Enabled
Benefits:
• Pre-approved workflow ensures compliance
• Balance maintenance prevents overscheduling
• Public holidays included for accurate calculation
• Payroll integration for salary adjustments
• Dashboard visibility for easy access
Example: Configuring an Unpaid Leave Type
Unpaid leave types require different configuration to provide flexibility while maintaining appropriate controls:
Basic Setup
Set Display Name to "Unpaid Leave" and configure Approval as "By Manager" for simplified workflow.
Work Entry Type
Set Work Entry Type to "Unpaid" to ensure proper payroll treatment without salary deductions.
Flexibility Settings
Set Requires Allocation to "No Limit" and disable Public Holiday Included for maximum flexibility.
Negative Balance Control
Enable Allow Negative Cap and set Maximum Excess Amount to 10 days for limited overdraft flexibility.
Advantages of Custom Time Off Types in Odoo 18
Odoo 18 makes configuring Time Off Types more powerful and flexible than ever. Whether your organization follows a liberal leave policy or a tightly managed system, Odoo provides the tools to implement it efficiently.
Comprehensive Payroll Integration
Automatically aligns leave types with salary rules and work entries for accurate payroll processing.
Tailored Workflows
Supports multilevel validation workflows with different approval hierarchies for various leave types.
User Empowerment
Empowers employees to track and request leave within defined rules while maintaining organizational control.
Policy Enforcement
Define granular rules including negative caps, allocations, and visibility to enforce company policies consistently.
Key Insight
With features like approval hierarchies, public holiday management, negative balance controls, and payroll integration, HR teams can build a leave policy framework that ensures compliance, boosts transparency, and supports strategic workforce planning.
Best Practices for Time Off Configuration
To maximize the effectiveness of your time off management system, follow these best practices when configuring time off types in Odoo 18:
| Practice | Implementation | Benefit |
|---|---|---|
| Clear Naming Convention | Use descriptive names that clearly indicate leave type and purpose | Reduces confusion and improves user experience |
| Appropriate Approval Levels | Match approval requirements to leave type importance and company policy | Balances efficiency with control and compliance |
| Payroll Integration | Always configure work entry types for proper payroll treatment | Ensures accurate salary calculations and deductions |
| Regular Review | Periodically review and update time off types based on policy changes | Maintains alignment with evolving business needs |
Frequently Asked Questions
What's the difference between "By Employee's Approver" and "By Time Off Officer" approval?
"By Employee's Approver" routes approval to the direct manager, while "By Time Off Officer" routes to designated HR personnel. "Both" requires approval from both for stricter control.
When should I enable "Allow Negative Cap"?
Enable this for emergency situations or when you want to allow employees to take leave before it's accrued. Set a reasonable Maximum Excess Amount to control overdraft limits.
How does "Public Holiday Included" affect leave calculations?
When enabled, public holidays within the requested leave period are counted as leave days. When disabled, they're excluded, which can significantly impact leave consumption.
What is the purpose of "Kind of Time Off" classification?
This classification determines how the time off is treated in payroll and timesheet systems. "Working Time" affects attendance tracking, while "Absence" is treated like vacation or sick leave.
Need Help with Time Off Configuration?
Our Odoo HR experts can help you design and implement comprehensive time off policies tailored to your organization's needs and compliance requirements.