Tracking Time-Off Accruals with Personnel SoftwareSeptember 15, 2021
One of the most time-consuming tasks for people who are managing personnel data is managing time-off accruals and keeping track of the deductions of when employees take vacation time or sick time. Many small businesses still buy paper forms they keep in the employees’ personnel records or they keep the time-off records in multiple spreadsheets. They have a spreadsheet for each employee and each spreadsheet may have many tabs. Typically, spreadsheets have a tab for each accrual account, such as vacation time or sick time. Even for small businesses that don’t have many employees, it can take a lot of time to go through all those paper files or multiple spreadsheets to add the amount of vacation time or sick time an employee is eligible for that year. Personnel software saves time because it calculates time-off accruals automatically, so all a manager has to do is enter a deduction when an employee takes time off from work. The software calculates the remaining balance of the time-off accruals, so it’s always up to date.
The first step in managing time-off accruals in personnel software is setting up your accrual account. In the past, many companies had an account for vacation time and a separate account for sick time time off manager . More recently, companies have begun to have only one accrual account called PTO (Paid Time Off) that an employee can use for any type of time off. This makes managing time-off accruals even easier for managers.
The second step in using personnel software to manage time-off accruals is to set up an auto-accrual policy for each of your accrual accounts. You can actually set up multiple auto-accrual policies for each accrual account, if necessary. For example, if your part-time employees accrue less time off than full-time employees, you can setup a policy for each group of employees. Or, you can set up different time-off accrual policies for exempt and non-exempt employees.
Some of the things you will need to know before you can set up an auto-accrual policy in personnel software include the accrual period, start of accrual year, accrual rates for first year of employment, if there is a trial period, carryover rules, and the amount of time employees can accrue based on seniority. The accrual period is the frequency the employee accrues time off. It can be set to accrue weekly, biweekly, semimonthly, monthly, or annually. The start of an accrual year could be the employee’s anniversary date or specific month, such as the start of the calendar or fiscal year. The accrual rates for the first year of employment allow you to enter the amount of time off an employee would get each month for that first year. You can choose to set a trial period where a new employee would not accrue time for the first 30 to 90 days of employment as part of a probation period. The reset option allows you to set carryover rules, such as the “use-it-or-lose-it” rule where the unused time is forfeited at the end of each year. The seniority table allows you to define unique accrual rates to be accrued after the first year of employment.