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Hi bouyank557,
If you have concerns about Conditional formatting, here is an article for your reference: Use formulas with conditional formatting.
About the conditional formatting in the workbook you have, the formula is like this:
=COUNTIFS(lstEmpNames,valSelEmployee,lstSdates,"<="&C6,lstEDates,">="&C6,lstHTypes,'Leave Types'!$B$4)>0.
It means the date in the calender view that the selected employee has sick leave(cell B4 in the leave type sheet) will be colored like the preview:
If you want to set the new color for the leave types you add, you could use the similar formula and change the $B$4 to the cell reference of the leave type.
Regards,
Alex