Learn how to set up automatic Time in Lieu accruals and applications with the Rule Sets feature in QuickBooks Advanced Payroll.
The following scenarios will be covered in this article:
- Having the employee accrue time in lieu of overtime at a rate of 1 hour for every hour of overtime worked.
- Having the employee accrue time in lieu of overtime. The hours accrued will equate to the penalty rate for the overtime that would have been received.
- Having a salaried employee submit timesheets for different locations but still need to just be paid their standard hours per week.
Note: Pay condition rules only work if the rule set is applied to the employee's Pay Run Defaults page.
Set up a Time in Lieu Pay Category
- Navigate to Employees on the left menu.
- Select the Payroll Settings tab, then select Pay Categories under the Pay Run Settings section.
- Select Add.
- Enter ‘Time in Lieu’ in the Pay Category Name field.
- Tick the Accrues Leave box.
- Select Save.
Set up a Time in Lieu Work Type
- Navigate back to Payroll Settings, then select Work Types under the Pay Conditions section.
- Select Add.
- Name the work type ‘Time in Lieu taken’.
- Tick Full Time and Part Time in the Automatically enabled for section.
- In the Work maps to section, select Leave Category, then select Time in Lieu from the drop-down menu.
- Select Save.
More information about work types can be found here.
Configure Tags
Tags are especially useful when not all employees accrue time in lieu. By tagging selected employees, this will help save time in setting up the Time in Lieu automation in the next steps.
- Navigate back to Payroll Settings, then select Tags under the Pay Conditions section.
- Select Add.
- Enter the phrase ‘TIL’ to name the tag, then select the tick icon.
- A panel should appear from the right. Select the employees that will be applicable for Time in Lieu.
More information about tags can be found here.
Create the rule sets
- Navigate back to Payroll Settings, then select Rule Sets under the Pay Conditions section.
- Select Add, then name the rule ‘Time in Lieu’ and Save. If your employees are attached to an existing rule set and you want the Time in Lieu rule to show up to employees under that rule set, hover over it and select Edit Rules, then Add Rule.
- Select Create Rules, then Add Rule for a new rule set.
The employee can accrue time in lieu of overtime at a rate of 1 hour for every hour of overtime worked (Scenario 1)
- Create the following rule name: 'TIL 1 hour to 1 hour of OT.
- In the WHEN drop-down box, select Time worked, then select in shift period in the second drop-down box.
- Select the small gear icon on the right, then select Add ‘Where’.
- In the next drop-down box, select Tags, then enter TIL (or the name of your Time in Lieu tag) in the tag field.
- In the drop-down box under Tags, select is greater than employee standard hours.
- In the THEN drop-down box, select Multiple actions, then select Apply pay category, then select NONE in the next drop-down box.
- Select Add Action, then select Add leave accrual. Enter ‘1’ in the units field, then select Time in Lieu and per hour worked in the following two drop-down boxes.
- Select Save.
Note: The employee standard hours are those listed on the Employee’s settings > Pay Run Defaults page.
Below is an illustration of what the full rule should look like:
The employee can accrue time in lieu of overtime. The hours accrued will equate to the penalty rate for the overtime that would have been received (Scenario 2)
- Create the following rule name: 'TIL at penalty rates’.
- In the WHEN drop-down box, select Time worked, then select in shift period in the second drop-down box.
- Select the small gear icon on the right, then select Add ‘Where’.
- In the next drop-down box, select Pay category, then enter your overtime pay category, such as ‘Overtime + 50%’ in the pay category field.
- In the drop-down box under Pay category, select is greater than, then enter 0 hours.
- In the THEN drop-down box, select Multiple actions, then select Apply pay category, then select NONE in the next drop-down box.
- Select Add Action, then select Add leave accrual. Enter ‘1.5’ in the units field, then select Time in Lieu and per hour worked in the following two drop-down boxes.
- Select Save.
Like the previous rule, you can look at adding the criteria of a tag in order to have this rule trigger for specific employees as opposed to all of them.
Note: This rule will only trigger if your overtime pay category has been used. If you would like to automate overtime pay conditions, this article will show you how: How to Automate Overtime using Rule Sets
Below is an illustration of what the full rule should look like:
A salaried employee will submit timesheets for different locations but just need to be paid their standard hours per week (Scenario 3)
The following rule set will pay the employee their standard hours, but will accrue time in lieu for any hours above this. Additionally, time in lieu will be taken if they do not work their standard hours.
- Create the following rule name: 'Salaried TIL’.
- In the WHEN drop-down box, select Time worked, then select in shift period in the second drop-down box. This can be changed to any of the other options based on your needs.
- Select the small gear icon on the right, then select Add ‘Where’.
- In the next drop-down box, select Tags, then enter TIL (or the name of your Time in Lieu tag) in the tag field.
- Select Add Condition, then in the drop-down box under the ‘AND’, select Employment type. Enter ‘Full Time’ in the employment type field.
- In the drop-down box under Employment type, select is greater than employee standard hours.
- In the THEN drop-down box, select Multiple actions, then select Apply pay category, then select NONE in the next drop-down box.
- Select Add Action, then select Add leave accrual. Enter ‘1’ in the units field, then select Time in Lieu and per hour worked in the following two drop-down boxes.
- Select Save.
Below is an illustration of what this rule should look like:
In addition, if you want to create a rule for employees to use up their Time in Lieu balance whenever they don’t work their required hours:
- Create the following rule name: 'Under-Time’.
- In the WHEN drop-down box, select Time worked, then select in shift period in the second drop-down box. This can be changed to any of the other options based on your needs.
- Select the small gear icon on the right, then select Add ‘Where’.
- In the next drop-down box, select Tags, then enter TIL (or the name of your Time in Lieu tag) in the tag field.
- In the drop-down box under Tags, select is less than employee standard hours.
- In the THEN drop-down box, select Add remaining time, then select Add Action.
- Select Apply pay category in the following drop-down box, and select NONE in the pay category field.
- Select Add Action again, then select Add leave accrual. Enter ‘-1’ in the units field, then select Time in Lieu and per hour worked in the following two drop-down boxes.
- Select Save.
Below is an illustration of what this rule should look like:
Test the rules
- Select Test Rules on the top-right of the Rules Editor page.
- Check the current period dates. The pay run period dates should match exactly to the current period or a previous period.
- Select Import.
- Select the employee whose shifts you want to test, then select Import.
- Scroll down and select Run Test.
Once each day's earnings are displayed you can select the day you want to check. Select the question mark to show you the list of rules that have been triggered by that shift.
Then, you can review each rule that was triggered and see how/why it has been applied to that shift - keep in mind that rules are applied in order from top to bottom so a rule that's triggered may be overridden by another rule further down the list.