Create a Vacation Accrual Plan

This example shows how to create an absence accrual plan for vacation leave. The following table summarizes key decisions for this scenario.

Decisions to Consider	In This Example
Who is eligible for this plan?	All workers
What unit of measure should this plan use to process absences?	Days
What is the start date and length of the accrual plan term?	Start on January 1 and restart the same day in the following year.
When can workers start accruing leave time on the plan?	1 month after hire date
When can workers start using the leave time that they accrued	2 months after hire date
How much leave time can workers accrue in a term?	Workers who belong to grade A and B accrue at the rate of 15 days each accrual term. They can carry-over 5 days to the next term. Workers who are grade C and D accrue at the rate of 12 days each accrual term. They can carry-over 2 days to the next term.
Do you want workers to accrue time for the whole term at once or accrue in increments?	Accrue time each pay period.
What is the maximum leave time that workers can accrue?	40 days
Can workers use more time than their standard accruals during the plan term?	Yes, up to 5 days
How do you want to calculate cash disbursals of partial accrual balances at any time?	50 percent of the salary amount determines the payment for a unit of absence.
How do you want to calculate final balance payments for a terminated worker?	The salary amount determines the payment of a unit of absence.

Task Summary

To create the absence plan:

1. Create two rate definitions and a payroll element.

2. Create the absence plan.

Prerequisites

Before you create the absence plan, in the Absences work area:

1. Use the Rate Definitions task to create two rate definitions that calculate payment of a unit of absence based on 50 percent and 100 percent of the salary amount.

2. Use the Manage Elements task to create a nonrecurring element. Specify Absences as the primary classification and Vacation as the secondary classification in the Create Element dialog box, and complete the sections as shown in this table.

   Section	Value
   Absence Plan Details	Select Accrual Balances and Absences as the type of absence information to transfer to payroll.
   Accrual Liability and Balance Payments	Select Yes for these questions: Calculate Absence Liability? Does this plan enable balance payments when enrollment ends? Does this plan enable partial payments of absences? You must specify a rate for the liability calculation, which should be the same rate specified as the liability booking rate rule in Absence Management.
   Absence Payments	Select the Reduce regular earnings by absence payment option for the following question: How do you want to reduce earnings for employees not requiring a time card?

Creating the Rate Definitions

1. In the Absences work area Tasks panel tab, click Rate Definitions.

2. Click Create.

3. On the Create Rate Definition page, complete the fields, as shown in this table.

   Field	Value
   Name	Unit Rate of 50 Percent Salary
   Short Name	UR_50_PC_Salary
   Legislative Data Group	Select your legislative data group.
   Periodicity (Returned Rate Details section)	Bimonthly
   Balance Dimension	Year to Date
   Periodicity (Calculation section)	Bimonthly

4. Click Create.

5. On the Create Rate Contributors page, complete the fields, as shown in this table.

   Field	Value
   Balance Name	FIT Gross
   Balance Dimension	Year to Date
   Type	Actual
   Add or Subtract	Add
   Factor Rule	Value
   Factor Value	0.50

6. Click Save and Close.

7. Repeat step 2 through step 6 to create another rate definition. Ensure that you provide the following key information, as shown in this table:

   Field	Value
   Name	Unit Rate of Salary
   Short Name	UR_ Full_Salary
   Factor Value	1.00

Creating the Absence Plan

1. In the Absences work area Tasks panel tab, click Absence Plans.

2. Click Create.

3. In the Create Absence Plan dialog, complete the fields, as shown in this table.

   Field	Value
   Legislation	Select your legislation.
   Plan Type	Accrual

4. Click Continue.

5. On the Create Absence Plan page, complete the fields, as shown in this table.

   Field	Value
   Plan	Vacation
   Legislative Data Group	Select your legislative data group.
   Status	Active
   Plan UOM	Days
   Type	Calendar year
   Calendar	Select the first day of your plan term year. In this example, select January 1 of the current year.

6. Click Save.

7. Select the Participation tab, and complete the fields, as shown in this table.

   Field	Value
   Waiting Period UOM	Months
   Duration	1

8. Click Save.

9. Select the Accruals tab, and complete the fields, as shown in this table.

   Field	Value
   Accrual Method	Incremental
   Accrual Frequency Source	Person primary frequency
   Accrual Vesting Rule	Elapsed period
   Duration	2
   UOM	Months
   Ceiling Rule	Flat amount
   Ceiling	40
   Carryover Rule	Include in matrix
   Negative balance allowed	Select
   Negative Balance Limit	5

10. In the Accrual Matrix section, create accrual bands, as shown in this table.

    Sequence	Expression	Accrual Rate	Carryover Limit
    1	([Person.Grade] = "A") OR ([Person.Grade] = "B")	15	5
    2	([Person.Grade] = "C") OR ([Person.Grade] = "D")	12	2

11. Click Save.

12. Select the Entries and Balances tab, and complete the fields, as shown in this table.

    Field	Value
    Final Balance Payment Rate Rule	Select the Unit Rate of Salary rate definition that you created.
    Disbursement Rate Rule	Select the Unit Rate of 50 Percent Salary rate definition that you created.
    Absence Payment Rate Rule	Select the Unit Rate of Salary rate definition that you created.
    Liability Booking Rate Rule	Select the Unit Rate of Salary rate definition that you created.
    Transfer absence payment information for payroll processing	Select
    Element	Select the element that you created as part of the prerequisite task.

13. Review the information you entered in all the tabs.

14. Click Save and Close.