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Working with Vacation Pay

eNETEmployer allows you to calculate vacation pay on applicable earning types. You have the option of accruing the vacation amounts until the employee is ready to receive the funds, or you can pay out the vacation amounts each period.

Paying Out Vacation

If an employee takes the time off and will be paid from their accrued vacation:

  1. In the vacation Hours cell (in either the Speedy Update or Earning Items screens), enter the number of work hours to be paid for the period.
  2. Calculate the payroll and review the Pay Register report.
  3. eNETEmployer will pay the desired vacation amount to the employee and reduce the amount accordingly in the vacation accumulator.

If an employee will receive their entire accrued vacation amount on a given pay run:

  1. Open the Employee - Accumulator Items screen and set the employee's Action cell to This pay only.
  2. Calculate the payroll and review the Pay Register report.
  3. eNETEmployer will pay the full accrued vacation amount to the employee. The accumulator's Action cell will be reset to Accrue automatically.

If an employee will be paid their vacation pay on every pay run:

  1. Open the Employee - Accumulator Items screen and set the employee's Action cell to Always Pay.
  2. Calculate the payroll and review the Pay Register report.
  3. eNETEmployer will pay the vacation amount to the employee on each pay.

Calculating Vacation on Vacation

The Functions feature allows employees to accrue vacation pay on vacation pay. To do this, simply include your Vacation earning in your Vacation Pay function. eNETEmployer will then calculate accrued amounts that were allocated to the Vacation earning.

Note: This method only works if the vacation amounts are being accrued (i.e. the accumulator's Action is set to "Accrue"). If your accumulator is set to "Always pay", or "This pay only", then you must perform the steps shown in the following section.

To calculate vacation on vacation when the accumulator is set to "Always pay" or "This pay only":

In this case, you must adjust the employee's accumulator rate to include several levels of recursion, so that it will pay out the entire amount as follows:

  1. Open the Employee - Accumulator Items screen.
  2. Override the accumulator's P Value rate for the employee as follows:
    • For employees earning 4% vacation pay: Change the P Value amount to .0416.
    • For employees earning 6% vacation pay: Change the P Value amount to .0638.
    • For employees earning 8% vacation pay: Change the P Value amount to .0869.
    • For Saskatchewan employees earning 5.77% vacation pay: Change the P Value amount to .0612.

      Recursion Formulas: The adjusted rates shown above were calculated as follows:

      • 4% = .04 + (.04 x .04) + (.04 x .04 x .04) = .041664
      • 6% = .06 + (.06 x .06) + (.06 x .06 x .06) = .063816
      • 8% = .08 + (.08 x .08) + (.08 x .08 x .08) = .086912
      • .577% (Saskatchewan) = .0577 + (.0577 x .0577) (result: .0033) + (.0577 x .0577 x .0577) ) (result: .0002) = .06122


See Also