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 tab on the payroll dashboard, then go to Leave Categories under the Pay Run Settings heading...
Please note: 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 you want to change the leave settings for your existing employees you will also need to make the same adjustments on each employee's, leave allowances page. You can do this "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 2 Leave Categories:
- Annual Leave
- Sick Leave
You can choose to add more categories by clicking on the green "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;
- Employee Leave Balance - Dropdown 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;
- 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;
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 dropdown 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 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;
- 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 hours accrued will be capped. If the accrual IS NOT to be capped, select "not limited" from the dropdown list. If the accrual IS to be capped, select "limited to" from the dropdown list and then enter the maximum number of hours that should accrue;
Payment Setup: This determines whether the employee is paid for the leave taken and the pay category that is assigned when leave is taken.
- 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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