To set up an employee’s vacation entitlement: Access the “Vacation” settings by clicking the "Employees" tab, then under "Active" select the name of the employee. (The system will automatically default to "The Person" tab.) Select "The Job" tab and you will see "Vacation" options on the right-hand side of the screen.
Vacation Setup Options
1. Does not apply: This option is typically the case with contractors. Choosing this option means that there is no need to track the employee’s vacation, as such, the system will not calculate any dollars against vacation. If this applies, select "Not applicable" in the vacation column and click "Save" to apply this option.
2. Paid out each pay: By selecting this option, your employee will receive their vacation pay due to them with each payroll. This percentage is defaulted to the base entitlement rates for the province in which you are paying the employee. (See “Determine employee vacation entitlements” later in this article.)
If the employee is entitled to more than the base rate, or, if your business has a vacation entitlement program that differs from the federal, provincial or territorial standard (i.e. 4% or two weeks), then set the “Override Vacation Accrual” to Yes, and enter the applicable percentage rate (i.e. 6.0%).
Note: The override feature does not calculate or apply retroactively and is on subsequent runs only.
3. Accrued each pay: By selecting this option, vacation pay due to the employee will be held back (accrued) and not be paid out. However, when the employee has taken vacation time off, you will have to input the dollar value of the vacation hours taken to draw down the balance when payroll is run.
Similar to the option where vacation is paid out, the vacation is accrued at the default provincial rate. You can choose to override the percentage by checking "Yes" to "Override Vacation Accrual" then entering the desired percent in the "Override Percent" field. (Note: The override feature does not calculate or apply retroactively and is on subsequent runs only.)
Determining Employee Vacation Entitlements
The primary regulations for employee vacation entitlements are:
Two weeks of vacation for every completed “year of employment” (typically based on the employee’s start date).
After six consecutive years of employment with the same employer, the entitlement increases to three weeks.
In percentages, this is:
4% = 2 weeks
6% = 3 weeks
8% = 4 weeks
In other words, the formula is 2% for each week of entitlement. To calculate a percentage that’s not outlined above, multiply the number of weeks of entitlement by 2%.
Provincial and territorial regulations
Every province has its own regulations for employee vacation entitlements. To verify the standards that apply, see the appropriate provincial or territorial ministry of labour.
The defaults in Wagepoint are determined by the provincial regulations and the employee’s hire date. The default will also automatically advance to the next level of vacation entitlement, based on start date, for example, three weeks after six consecutive years of employment.
Used in situations where the employee is entitled to a higher rate than the default.
Currently, the only way that a change in vacation type (does not apply, paid each pay or accrued) or entitlement (%) can be verified is by reviewing the pay stubs.