Purchased Leave

To support staff with family or other commitments, employers may allow staff to adopt a 46/48/50-week year for a negotiated 12-month period. The salary paid to them will be 46/52, 48/52 or 50/52 of their full-time salary.

Within the nominated 12-month period, staff are able to apply to have two weeks (50/52) or four weeks (48/52) additional annual leave, with a proportionate reduction in salary spread over the full year. 

How to set up purchased leave by dividing salary
  1. Create a specific leave allowance template for purchased leave for each option, e.g. 2 weeks, 4 weeks etc.
  2. Each annual leave field will have the accrual based on whatever extra annual leave is being purchased, e.g. 2 weeks would have the annual leave accrual as 0.11538 hours per hour worked: 

    2020-09-17_15-02-09.jpg

  3. Assign the corresponding leave allowance template to the employee via their Employee file > Pay run defaults page.
  4. Change the salary of the employee by dividing leave weeks by total weeks e.g. 2 weeks extra annual leave would be Salary x 50/52. You can enter the new rate on the Employee file > Pay run defaults page.
  5. If you want to keep a record of the original salary, you can enter it as a note on the Employee file > Details page:


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You can also set up an anniversary date to trigger when the year is up to then pay out any remaining balance of leave not taken.

How to deduct pay for purchased leave from each pay run
  1. Create a specific leave allowance template for purchased leave for each option e.g. 2 weeks, 4 weeks etc.
  2. Each annual leave field will have the accrual based on whatever extra annual leave is being purchased e.g. 2 weeks would have the annual leave accrual as 0.11538 hours per hour worked: 

    2020-09-17_15-02-09.jpg

  3. Assign the corresponding leave allowance template to the employee via their Employee file > Pay run defaults page.
  4. Navigate to Business > Payroll Settings > Deduction Categories.
  5. Create a new deduction category called Purchased Leave. 
  6. Add the deduction category to the employee under Pay Run Inclusions. 

Warning

Purchased leave accrues at the pro-rata rate in the leave year.

Example: if an employee has purchased  50/52 leave, and they would usually accrue 13.3hrs of annual leave per month, then they would accrue 20hrs per month for the leave year. 

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