Employers in different Provinces in Canada and different States in the US have their own offerings when it comes to vacation time but all offerings are within the regulations in each employee’s jurisdiction. A couple of commonly used methods with setup steps based on certain scenarios are referenced below:
- Lump Sum method – the employee gets a lump sum at the beginning and not accrue any hours or amount for the rest of the year.
- Accruing method – the employee gets a certain number of hours or percent of their pay for a certain pay frequency.
A commonly used method to track and consume or pay this time or dollar amount is to create an Accrual. Here’s how you can setup these 2 time accruing scenarios in Sage 300 using the following criteria:
Lump Sum Method
Scenario:
- Get 80 hours at the beginning of the calendar year during the first 2 years of employment.
- Get 120 hours at the beginning of the calendar year during the next 3 years.
- Get 160 hours at the beginning of the calendar year on the 5th year and onward.
- No accruing the rest of the year.
- Can bring max 40 unused hours to the following year.
Setup of some fields and values as suggested for this scenario:
- Go to Payroll Setup.
- Double click on Earnings and Deductions.
- Enter or select the appropriate options as shown in the following tabs:
Basic Info:
- Earning/Deduction name: VAC
- Description: Vacation Time
- Short Description: Vacation
- Category: Accrual
- Type: Vacation
- Employee Calc. Method: Hours per Frequency
- Frequency: select one (Weekly, Bi-weekly, Semi-monthly, Monthly)
- Level: (use a value = value selected for earnings codes + 1)
- Starts: Date of Hire
- Ends: N/A
- Linked Accrual Earning: Optional; if you select the earning code here, it will use the rate from this earning when paying out vacation.
Employee:
- Cap Accrual at Max. Accual: select this option so employee cannot accrue anymore when some hours are used.
- Line 1:
- Through Service Year: 2
- Beginning: 80
- Increment: 0
- Accrual: 120
- Carry-over: 40
- Line 2:
- Through Service Year: 5
- Beginning: 120
- Increment: 0
- Accrual: 160
- Carry-over: 40
- Line 3:
- Through Service Year: 99
- Beginning: 160
- Increment: 0
- Accrual: 200
- Carry-over: 40
- Accrual Payments Subject to the Following Taxes: Select the appropriate taxes that vacation is subject to.
G/L Dist
Select the GL Expense account for paying out vacation pay.
- Save this vacation code.
- Add them to each qualified employee and this vacation code is ready to go.
Accruing Method
Scenario:
- Starting on the date of hire, employees can accrue up to 80 hours a year in the first 2 years, 120 hours from year 3 to 5 and 160 hours from year 6 and onward.
- Can bring max 40 unused hours to the following year.
Setup of some fields and values as suggested for this scenario:
- Go to Payroll Setup.
- Double click on Earnings and Deductions.
- Enter or select the appropriate options as shown in the following tabs:
Basic Info:
- Earning/Deduction name: VAC
- Description: Vacation Time
- Short Description: Vacation
- Category: Accrual
- Type: Vacation
- Employee Calc. Method: Hours per Frequency
- Frequency: example uses Bi-weekly
- Level: (use a value = value selected for earnings codes + 1)
- Starts: Date of Hire
- Ends: N/A
- Linked Accrual Earning: Optional; if you select the earning code here, it will use the rate from this earning when paying out vacation.
Employee:
- Cap Accrual at Max. Accual: select this option so employee cannot accrue anymore when some hours are used.
- Line 1:
- Through Service Year: 2
- Beginning: 0
- Increment: 3.08
- Accrual: 120
- Carry-over: 40
- Line 2:
- Through Service Year: 5
- Beginning: 0
- Increment: 4.62
- Accrual: 160
- Carry-over: 40
- Line 3:
- Through Service Year: 99
- Beginning: 0
- Increment: 6.15
- Accrual: 200
- Carry-over: 40
- Accrual Payments Subject to the Following Taxes: Select the appropriate taxes that vacation is subject to.
G/L Dist
Select the GL Expense account for paying out vacation pay.
- Save this vacation code.
- Add them to each qualified employee and this vacation code is ready to go.
When vacation hours are being used, one may enter the vacation code in a timecard for the appropriate hours and enter the Type as Payment and the accrued total will be reduced. If adjustments are needed, Transaction History can be used to adjust the balance of the vacation code.
