Setting "Out of Office" in Salesforce Calendar

Availability status is part of an "event" added to a calendar and not visible by default. To make it visible, the System Administrator needs to first add the field "Show Time As" to the page layout. This can be done as follows:

1. Click on: Setup >> App Setup >> Customize >> Activities >> Event Page Layouts. 
2. Edit the page layout. 
3. Click and drag the "Show Time As" field into the page layout into "Calendar Details" section

 You can now change the availability status to "Out of Office", "Busy", or "Available" when you add an event to the SFDC calendar.