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What Is An Accrual Policy?
An accrual policy is a schedule upon which your employees earn paid time-off
(such as Vacation, Sick, Personal, etc). There are two different types
of accruals: Calendar Based, and Hours-Worked Based.
Calendar Based Accruals
A calendar based accrual policy gives each employee a set number of hours
a year, and can be set to start accruing with the new fiscal year, or
on the anniversary of the employee's hire date. Employees assigned to
a calendar based accrual policy receive the accrued hours regardless of
the number of hours worked.
Example: A calendar based accrual policy would be used if you wanted
to give your employees 120 hours of Vacation time per year.
Hours-Worked Based Accruals
An hours-worked based accrual policy gives employees a specified number
of accrued hours based on the number of hours worked.
Example: An hours-worked based accrual policy would be used if you
wanted to give your employees one hour of Sick time for every 20 hours
worked.
Length of Service Milestones
Length of Service Milestones allow you to set up different rates of accruals
based on employee seniority. Multiple milestones can be created for each
policy.
Example: Company policy states that employees are not eligible for
accruals until they have worked for the company for 90 days. After 90
days, employees begin to accrue 20 hours of Vacation time per year. Once
employees have worked for the company for a year, they begin to accrue
30 hours of Vacation time per year. Employees who have been with the company
for 5 years receive 40 hours of Vacation time per year. Length of Service
Milestones are set up within the Vacation accrual policy to reflect the
different accural rates. |
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