There are two methods to accrue leave:
1. On a specified Contract Hours code - for standard hours.
2. Based on the Hours Worked by the employee - for unpredictable hours.
Contract Hours Leave
Leave hours are accrued between dates using the Entitlement in the leave class (i.e. 4 Weeks per year) and the Contract Hours attached to the employee. This means for an employee attached to a '4 Weeks Per Year' class, the employee's Contract Hours will determine how many hours to accrue for the year.
Annual Leave of 4 Weeks Per Year + Contract Hours of 7.6Hrs x 5 days per week = 152 hours accrued per year (38h x 4w)
Annual Leave of 4 Weeks Per Year + Contract Hours of 5Hrs x 2 days per week = 40 hours accrued per year (10h x 4w).
In the above examples, both employees are entitled to 4 weeks Annual Leave and it is the Contract Hours that defines ‘a week’ for the employee. Contract Hours are found in Payroll, Maintenance, General, Contract Hours.
Once created, you can attach Contract Hours to Pay Details on the Employee record (Payroll, Maintenance, Employees, Employees). Attach Leave Classes to the employee record under Leave.
With this method, you may see a small difference in the accruals. This is because the leave accrues per day based on 365 days per year (this is not adjusted for a leap year). This method calculates a daily accrual, providing greater accuracy, forecasting of leave and accurately calculating leave on Termination to the end of the termination date.
To calculate Daily Accrual:
Annual Leave Hours Per Year - 4 weeks x 38 hours = 152 hours
Annual Leave Accrual per Day - 152/365 = 0.41644 hours
0.41644 x 365 = 152.00 hours
To set up Contract Hours Leave:
Go to Payroll, Maintenance, Leave and select the Leave Type to create, e.g. Annual Leave.
Enter a Code and Description.
Don't tick Calculate on Hours Worked.
In Entitlement: Maximum Each Period, enter how many weeks are accrued over the entitlement period. For Example 4 (Entitlement) Weeks (Units) per 1 (Number) Years (Per Period).
Click OK to save.
Tip: Express the entitlement in weeks to accommodate all contract hours variations.
Hours Worked Leave
Hours Worked Leave multiplies the selected hours included in a timesheet by the Accrual Rate to calculate the leave accrual. Contract Hours is not required to be attached to the employee.
This method enables unpaid leave hours to be omitted from the accrual of leave; however, you can't forecast leave to a specific date as the hours worked are unknown.
The Accrual Rate is a percentage and is calculated by dividing the maximum leave accrual by the entitlement period. For example:
Accrual Rate for 4 weeks per 1 Year = 4 weeks / 52 weeks x 100% = 7.6923%
The Entitlement Maximum each Period is included in the leave class and is the maximum leave an employee can accrue in a year.
To set up Hours Worked Leave:
Go to Payroll, Maintenance, Leave and select the Leave Type to create, e.g. Annual Leave.
Enter a Code and Description.
Tick Calculate on Hours Worked.
Select the Hours Type, Other Leave Reasons, User Defined Leave and Additions to accrue leave on. Anything ticked will be multiplied by the Accrual Rate when leave is updated.
Other Leave Reasons are used in conjunction with the Other Leave Hour Type. E.g. if you enter Other Leave and a nominated Leave Reason in a transaction, leave will accrue. All other leave will accrue is selected regardless of the Leave Reason.
User Defined Leave will only be available when User Defined Leave is selected in Hour Types.
Enter the Accrual Rate.
In Entitlement: Maximum Each Period, enter the maximum accrual for the entitlement period. For Example 152 (Entitlement) Hours (Units) per 1 (Number) Years (Per Period).
Click OK to save.