How to set up holiday pay and accrual.

There are two types of holiday pay that you can configure in 12Pay, for salaried staff and for hourly-paid staff.

Salaried staff

A holiday record is created and 12Pay keeps a record of the leave that has been taken.

Hourly paid staff

Holiday entitlement is accrued for each hour worked and this is based on the 12.1% statutory minimum.

To set up a holiday record for salaried staff

Firstly, you will need to set up the holiday year. You can do this in the ‘Advanced‘ tab of the payroll frequency, entering the details in the ‘Holidays‘ section towards the bottom. You will need to enter the start date (please note: this is not maintained by 12Pay, you will need to update this manually year by year) and enter the default entitlement. You can then click on ‘Update Employees’ Accrued Holidays‘ button which will update this information on an employee level. Alternatively, you can enter individual employees entitlement on the ‘HR‘ tab of the employee.

To add the holiday absence you will need to select the ‘Absences‘ tab of the employee, amend the ‘SSP Qual. Days‘ to the days that the employee works if required, select ‘Add Absence‘ and then ‘Holiday‘. The calendar view will then populate and you will need to select the first date of absence, following this will be the ‘Absence Entry‘ dialogue box where you can enter the final date of absence. The ‘Work Days‘ will reflect the correct amount of holiday days taken.

If you would like the holiday pay to appear as an element on the payslip you will need to select the ‘Pay‘ tab, select ‘Add Payment/Deduction‘ and then ‘Holiday Pay‘. You can enter the amount in the ‘Pay‘ field below where is states ‘Hours‘ and ‘Rate‘ in the centre of the white section. Do not forget to also amend the basic pay to reflect the number of hours worked.

Once you have moved forward into the next period you can see that the ‘HR‘ tab of the employee will now have amended figures for ‘Time Taken‘, etc. and the holiday reports will also show information from the holiday record.

Hourly paid staff

Again, you will need to set up the holiday year. You can do this in the ‘Advanced‘ tab of the payroll frequency, entering the details in the ‘Holidays‘ section towards the bottom. You will need to enter the start date (please note: this is not maintained by 12Pay, you will need to update this manually year by year). The default entitlement is not required in this circumstance but you can enter the balance brought forward on the ‘HR‘ tab of the employee should they have any remaining holiday hours from the previous year. You can then click on ‘Update Employees’ Accrued Holidays‘ button which will update this information on an employee level.

Because the holiday entitlement is based on 12.1% you will need to make sure that the hours worked are recorded on all pay elements such as ‘Basic Pay‘ and ‘Overtime‘, etc. You will need to add the holiday pay under the period tab of the employee (the third tab across – Week #/Month #), again it is important that you record the hours booked so that the holiday accrual can be added or deducted accordingly. Once set up and you have moved into the next period you can visit the ‘HR‘ tab of the employee and click on the button with the icon of a magnifying glass. This will generate the report with the amount of accrual so far.

Showing the employees holiday accrual on their payslip

Firstly, select the ‘Reporting‘ tab of the payroll frequency, you will see the ‘Holiday Text’ section where you can use the drop-down menu to select the relevant option and this will display the holiday text on the payslip. This can be used in both configuration methods, whether it is for salaried or hourly paid staff.