This screen allows you to set up your leave categories and control which of them accrue automatically, how they will behave in the pay run, whether or not to include them in termination payments, and decide which should appear in your employee's pay slips.
The settings for leave categories can be accessed and updated by clicking on the 'Payroll settings' > 'Leave Categories' link on the payroll dashboard.
- Any changes that are made to your business's leave category settings will not be applied to existing employees. The new settings will only apply "automatically" to any new employees who are subsequently added to your payroll.
- If a leave allowance template is not assigned to an employee, the leave category settings will apply automatically to those employees. If you want to change the leave settings for employees you will need to do this on an individual basis. To do this, go to the employee file and access the Leave Allowances screen.
- You can change employee leave settings in bulk by using a leave allowance template, then apply that template to each employee's record - this is all explained here...Leave Allowance Templates.
The default setup for a new business includes the following types of Leave categories:
- Annual Leave
- Sick Leave
- Statutory Adoption Leave
- Statutory Maternity Leave
- Statutory Parental Bereavement Leave
- Statutory Paternity Leave
- Statutory Sick Leave
You can choose to add more categories by clicking on the Add button to the right of the screen. You will then need to enter the following information:
- Name (required)
- External Id - This is only required if you are using an external system to capture leave requests or timesheet entries and hence need to map the code used from such external system. If an external id is used that has been used before you won't be able to save it if the 'unique external Id' setting is switched on. This setting is located on the Payroll settings > Advanced settings page. See here for more information.
- Leave Category Type - There is a drop down box to choose from 'Standard', 'Long Service Leave' or 'Personal/Carer's Leave'. N.B. If 'Personal/Carer's Leave' is selected the fields Automatically Accrues and Standard Allowance will be pre-populated and locked, ie cannot be edited.
- Employee Leave Balance - There is a drop down box to choose from 'Tracked' or 'Not tracked'.
Note: For some types of leave that aren't accrued in the usual way (e.g. leave without pay) it might not make sense for an employee to have a 'balance'. In these cases you should set this value to 'Not tracked' to tell the system it doesn't need to keep track of how much of this type of leave an employee is entitled to;
- Automatically accrues - Select this option if the leave is to accrue automatically. You will then be required to choose whether the leave will accrue on an ongoing basis or accrue based on a defined leave year. The leave year can be set as the employee's start date or another specific date. This date is specified via the employee's "Leave Allowances" page:
- Exclude from termination payout - Select this option if you do not want any of the unused leave balance for this leave category to automatically be paid out upon termination.
- Hide accruals from pay slips - Select this option if you do not wish to allow employees to see the amount of leave accrued for this leave category within a pay run on their pay slips;
- Hide balances from pay slips and in employee portal - Select this option if you do not wish to allow employees to see the balance of this leave category on their pay slips or in the employee portal;
- Hide leave category name from employee view - Select this option if you do not wish to have the leave category name displayed in the calendar contained within the employee's portal. All that will be displayed is the employee name and the period of leave taken. This setting works in conjunction with the setting "Employees can view approved leave" from the Employee Portal Settings screen.
The following image is an example of how approved leave is displayed in the employee portal depending on whether the leave category name is displayed or hidden:
The following image will only be displayed where leave is set to accrue automatically on an ongoing basis:
- Standard allowance - Enter the number of hours per hour worked OR hours per pay run the employee is to accrue. You can also click on the calculator icon to assist with calculating the entitlement and ensuring the correct figure is being applied, for eg:
- Leave accrual capping - This setting allows you to select whether or not the number of hours accrued will be capped. If the accrual is to be capped, select "limited to" from the drop down list and then enter the maximum number of hours that should accrue:
The following image will only be displayed where leave is set to accrue automatically based on the employee's leave year:
- Standard allowance - Enter the number of units the employee is to accrue. You can also click on the calculator icon to assist with calculating the entitlement and ensuring the correct figure is being applied;
- Accrue in advance - Select this option if you want employees to accrue their whole entitlement in advance. This means that the full annual entitlement will be accrued in the employee's first pay run and will be added to their leave balance;
- Leave accrual capping - This setting allows you to select whether or not the number of units accrued will be capped. If the accrual IS NOT to be capped, select "not limited" from the drop down list. If the accrual IS to be capped, select "limited to" from the drop down list and then enter the maximum number of units that should accrue;
- Carrying over the balance - This setting allows you to cap the number of leave units to carry over to the next leave year. If the entire leave balance is to be carried over, keep the default setting of "the entire balance". If only a portion of the leave balance is to be carried over, select "a maximum of" from the drop down list and then enter the maximum number of units to be carried over.
The setting "Unit type" will only display if the "Automatically Accrues" checkbox is not ticked. This setting is required so that the system knows whether to display the leave in days, weeks or hours. The display is relevant for when an employee applies for leave. When a leave category is displayed in either days or weeks, the leave will then be converted into hours in the pay run and a conversion formula will be made available to see how the conversion was calculated.
Payment Setup: This determines whether the employee is paid for the leave taken and the pay category that is assigned when leave is taken. (The default setting for Payment Setup on the Annual Leave - leave category used to be Basic but this has been updated in later releases so that the leave is reported against a separate pay category called Annual Leave Taken - you are free to change this if necessary)
- Basic: When an employee does not use timesheets, the employee's leave balance will be reduced, earnings are not impacted. When an employee is using timesheets to submit all time worked, an earnings line will be created and the leave balance will be reduced. To check or assign the employee's timesheet setting, go to the employee's 'Pay Run Defaults' page. The timesheets option
is near the top of the page.
- Don't pay for the leave taken: When an employee does not use timesheets, an earnings line with negative hours will be added to reduce the earnings for the employee. When an employee is using timesheets to submit all time worked, no earnings line will be created.
- Report the earnings for the leave taken against another pay category: When wanting to report payments for leave taken in a separate pay category (for reporting/journaling purposes), select this option. The earnings related to the leave taken will be assigned against the specified pay category instead of the employee's primary pay category. When this alternative is selected, the option will be given to use the rate of pay from the employee's primary pay category.
- Custom: For advanced users only, this option allows the user to deduct hours from an arbitrary pay category and transfer them to another arbitrary pay category when leave is taken.
For examples of how to set up leave based on different scenarios, refer here.
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