Vacation Liability Payments for Multiple Terms

Vacation liability is the minimum amount of vacation pay an employee is legislated to receive in a given year according to the provincial statutory requirements.

When an employee is terminated or goes on a leave of absence and there are positive balances across multiple vacation plan years, you can pay the vacation liability amount owed to the employee across multiple vacation plan years or terms with a single payment.

The vacation payout can be across multiple terms or for a specific term. To process a vacation payout of the liability to an employee for multiple terms, note these important points:

• Create a vacation payout element and assign it to the employee.

• If you leave the Vacation Accrual Reduction Date field in the Element Entries section of the element blank, the payout includes the accrued balance for all available vacation terms with positive balances.

• If you enter a value in the Vacation Accrual Reduction Date field, the payout includes the accrued vacation liability balance for a specific vacation term in which the reduction date falls.

• To make a partial accrued balance amount for a specific vacation term, enter a value in the Vacation Accrual Reduction Date field and the Amount field.

• If only an Amount is entered with no Vacation Accrual Reduction Date, the amount is reduced starting from the first available term until the partial amount is processed.

• Negative balances are ignored and not processed.

Employee absences reduce the vacation liability balances accumulated across multiple terms starting from the earliest vacation term, with a positive balance, to the current term. These factors reduce the accrued vacation liability balances:

• If you enter a Vacation Accrual Reduction date in the absence, then the accrued balance is reduced for the vacation term in which the reduction date falls

• If you don't enter a Vacation Accrual Reduction date in the absence, then the accrued balance is reduced from the earliest vacation term, with a positive balance, to the most current term.

• If any accrued balance remains after going through prior terms, then the accrued balance reduces the current term's accrued balance.

• If the accrued balance is negative for a prior term, it's ignored and the accrued balance isn't reduced.

• If the accrued balance is negative for the current term, the accrued balance is reduced.

Recording Absences for Multiple Terms

Employee absences reduce the vacation liability balances accumulated across multiple terms starting from the earliest vacation term, with a positive balance, to the current term. These factors reduce the accrued vacation liability balances:

• If you enter a Vacation Accrual Reduction Date in the absence, then the accrued balance is reduced for the vacation term in which the reduction date falls.

• If you don't enter a Vacation Accrual Reduction Date in the absence, then the accrued vacation liability balance is reduced from the earliest vacation term, with a positive balance, to the most current term.

• If the accrued vacation liability balance is less than the absence balance, then negative liability is processed for the vacation term.
• If the accrued balance is negative, the liability is processed based on the validity of the reduction date as given here:

  • If the reduction date is valid, the negative liability for the term is increased.
  • If the reduction date is invalid (outside of the current plan dates), the liability is processed starting from the first vacation term and continues through the current term, or until the absence amount is consumed.