Leave Accrual on Entitlement Basis

This screen allows you to set up your leave categories and control how they will accrue, whether or not to include them in termination payments, and decide which should appear in your employee's pay slips.

This article is for leave categories which accrue indepedently from pay run. Click on the topic you need to be directed to the correct section:

• Leave year start date
• Leave anniversary
• Add a new leave category
• Payment setup

You can access and update your settings for leave categories by following these steps:

1. Click the  Business menu.
2. Click the Payroll Settings submenu.
3. Under Pay Run Settings, click  Leave Categories.

Leave year start date

The first setting you will notice on this screen relates to setting the leave year start date. This will allow you to configure a start date when leave accrual will start. You can select Leave year should start on Calendar year, Employee start date, or a Specific date.

If the leave year start date is different for each employee, you can set this up at the employee level from each employee's Leave Allowances screen.

Leave anniversary

The next setting is the Leave anniversary option. This setting relates to tiered leave allowance templates and triggers the tiers to change in the employees Leave Allowances page, essentially defining when the leave allowances should 'reset'. The options available are calendar year, employees start date or you can select a specific date.

You can also enforce that any leave request submitted (be it by the employee or the manager, on behalf of the employee) includes notes about the leave. This setting is configured by ticking the "Require notes when submitting leave requests" checkbox.

Add a new leave category

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: The name of the leave category. A value is required in this field. Make sure it is self-explanatory, as the name will be made visible to employees and all users throughout the platform.
• External Id: This is only required if you are using an external platform to capture leave requests or timesheet entries and hence need to map the code used from such external platform. 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 this article for more information: Advanced Settings.
• Leave category type: This needs to be Entitlement-Based Leave
• Prevent negative leave balances: Further information can be found in this article: How to Prevent Negative Leave Balances within Pay Runs.
• Exclude from termination pay out: Select this option if you do not want any of the unused leave balance for this leave category to be paid automatically 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 portal. All that will be displayed is the employee's 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.
• Unit type: You can select days, weeks, or hours.
• Standard allowance: Enter the entitlement and then select from the dropdown list how frequent the accrual should be granted to an employee, i.e. Monthly or Yearly.
  
  • Monthly: Employee receives monthly accrual from Leave year start date.
  • Yearly: Employee receives yearly accrual on Leave year start date.
• Carry over: This setting will determine if any unused leave balance will be carried over to the following year. You can select below options
  
  • None: No unused leave balance will be carried over
  • Unlimited: All unused leave balance will be carried over
  • A maximum of: You can specifiy the number of unused leave to be carried over.
• Carry over date: This will default to the option indicated under the section the Leave year should start on.
• Forfeiture: This setting will determine if any carried over leave balance will be forfeited after a specified time. You can select below options
  
  • None: No carried-over balance will be forfeited.
  • Unlimited: All carried-over balance will be forfeited.
  • A maximum of: You can specifiy the number of carried-over leave to be forfeited.
• Forfeiture date: If you select Unlimited or A maximum of option for Forfeiture, you need to specify when the forfeiture should happen. You can specify the number of months after the carry over date.
• Pro rata for part time/casual employees: Select this option if you want the Standard allowance to be pro-rated based on employee’s working hours. Then based on the amount indicated in Standard hour per week and Full time equivalent hour in employee’s Pay run default, the accrual amount for the leave category will be pro-rated accordingly.
• Leave balances for new employees: Select how you want the accrual for employees who join in the middle of the year to be granted.
  
  • Do not apply leave balances to employees on assignment: Employee will not receive accrual in the first month/year. Employee will receive accrual from the second month/year
  • Apply full balance amount on employee assignment: Employee will receive full accrual in the first month/year
  • Apply pro-rata amount on employee assignment: Employee will receive pro-rated accrual based on employee’s start date and leave year start date. For this option to work correctly, you need to select Leave calculation method in Business Settings > Details.
    For example:
    • Leave year should start on Calendar year and Standard allowance is 1 day monthly and an employee joins on 15 Jan 2023.
    • Leave calculation method: 365/366 days, use number of calendar day, the first accrual for the new joiner: 1 / 31 * 17
      Leave calculation method: 260/261 days, use number of working day (i.e. exclude Saturday and Sunday), the first accrual for the new joiner: 1 / 22 * 12
    Similar example but with Standard allowance is 12 days yearly:
    • Leave calculation method: 365/366 days, the first year accrual for the new joiner: 12 / 365 * 340
    • Leave calculation method: 250/261 days, the first year accrual for the new joiner: 12 / 260 * 250

Payment setup

This section 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 or uses timesheets for exceptions only, the employee's leave balance will be reduced but default pay run earnings will not be 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, two earnings lines will be created (one positive, one negative) that will cancel each other out.
• Report the earnings for the leave taken against another pay category: When wanting to report payments for leave taken using 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.