Hi JulieR,
Thanks for your post.
This setting is greyed-out once the entitlement has been created and saved, so you won't be able to adjust this setting if it was not originally ticked.
In this case, you would need to create a new entitlement category to replace the original, ensuring the "carry-over" option is ticked, then transfer your employee's accruals from the old entitlement category to the new through an adjustment payroll. Once you have transferred their accruals, you can unassign your employees from the old entitlement category and assign them to the new.
if you'd like assistance on how to do the transfer of accruals, please do let me know. Happy to help!