Set up Categories & Accrual (hours or days)
This screen allows you to set up your leave categories and control which of them will accrue automatically (hours or days), 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 payslips.
The settings for Leave Categories can be accessed and updated by going to Payroll Settings, then to Leave Categories.
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.
The default setup for a new business includes 6 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 green Add button. 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 therefore need to map the code used from such an external system.
- Leave Category Type: dropdown box to choose from Standard or Long Service Leave.
- 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 payslips: 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 payslips.
- Hide balances from payslips and in the employee portal: select this option if you do not wish to allow employees to see the balance of this leave category on their payslips 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.
- Standard allowance & Accrual: Here you can choose to accrue in hours or days. For Leave In Hours, enter the number of Hours per hour worked OR Hours per pay run the employee is to accrue. For Leave In Days enter Standard Days Per year (recommended) or Standard Weeks per year. 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.
- Carrying over the balance: this setting allows you to cap the number of leave hours 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 dropdown list and then enter the maximum number of hours to be carried over.
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.