…No Annual Leave was calculated for my employee and the Holiday Pay remained the same!
Answer
This will occur when an employee has been set up with NO ‘Normal Hours’ and therefore NO Annual Leave entitlement. (more…)
How do I Pay out Annual Leave?
When employees take Annual Leave you should always pay it out using the Annual Holiday (ANHL) pay code.
This should be done even if an employee has not become entitled to Annual Leave as yet.
The payroll will record the Annual Leave taken as Annual Leave taken in advance as shown in the screen shot below.
Note: Any ‘Annual Leave taken in advance’ will be deducted when the employee’s anniversary is rolled or a final pay is prepared.
IMPORTANT
The Holiday Pay (HP) code is only used to record the accruing balance of Holiday Pay.
Holiday Pay should only be paid out in the following situations:
1. To a ‘Casual’ employee.
(This may be paid out ‘as they go’, however this would need to be clearly stated in the employee’s Individual Employment Agreement.)
2. When a ‘Final Pay’ is prepared.
(MYOB Payroll will calculate any Holiday Pay and Annual Leave owing to an employee when a ‘Final Pay’ is prepared.)#adp01
Can I change from a ‘Common Anniversary’ back to using ‘Individual Anniversary’ dates?
It is only possible to revert to using ‘Individual Anniversary’ dates for new employees and existing employees that have been employed for less than a year.
If you untick the ‘Common Anniversary ‘date option all existing employees who have been employed for more than 12 months should keep this anniversary date.
Existing employees that have been employed for less than a year will need the “Anniversary Dates” changed to 12 months from their start date.
New employees can be set up using their “Individual Anniversary Date”.#adp01
What is a Common Anniversary in Payroll?
A ‘Common Anniversary’ indicates that all employees Annual Leave updates are done at the same time.
This differs from the usual ‘Individual Anniversary’, 12 months after the employee start date.
Businesses that observe an ‘Annual Closedown’ often choose a ‘Common Anniversary’ date to make the management of leave easier.
The employer would normally nominate a ‘Common Anniversary’ date a few days prior to the ‘Annual Closedown’ to ensure it always comes before the ‘Annual Closedown’ commences.
This will enable the employer to run the ‘Common Anniversary’ updates prior to the Christmas pays being prepared and thereby gaining a very clear picture of each employees Annual Leave available.
Should I use a Common Anniversary Date?
There are strict rules in place with setting up a ‘Common Anniversary’ date.
We would suggest that you consult clauses 29 – 35 of the Holidays Act 2003 before continuing with setting up a Common Anniversary date (this appears in the Act under “Closedown Periods”).
It would be advisable also to consult your legal representative prior to setting up/changing your Common Anniversary date.
If you are looking for guidance, we would recommend contacting the Department of Labour on 0800 20 90 20
What Date should I choose for a Common Anniversary?
If a ‘Common Anniversary’ date is being be set, we would recommend that you choose a date prior to the date when the closedown will begin e.g. If the organisation normally closes down around the 19th – 24th of December, a date in the vicinity of the 15th -17th of December would be a good option.
This will allow you to update the Annual Leave records prior to running the last pay before the close down.
Can I change my Common Anniversary Date?
Although an ‘Anniversary Date’ can be altered it is not advisable to do so as this would require that the employees Annual Leave records would all need to be checked and manually adjusted.
Where do I set up my Common Anniversary date?
The ‘Common Anniversary’ date is set up within your Tools/Options of your payroll.
We use an ‘Individual Anniversary Date’ and wish to change to a ‘Common Anniversary Date’, Can we?
Unless you actually have a closedown period you should continue to use an individual anniversary date.
If you choose to change to a common anniversary date all leave records need to be manually checked and reset by the user.
As previously mentioned, there a very strict rules surrounding using a ‘Common Anniversary’ and we would recommend these being researched thoroughly prior to making the decision to use a ’Common Anniversary”.
If it is decided to go ahead and set up a ‘Common Anniversary” we would recommend that this is carried out in the first year of the businesses operation.
If the ‘Common Anniversary is NOT set up within the first year of business, all leave records will need to be manually checked and reset by the user.#adp01