Vacation Liability for Single and Multiple Terms

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

Vacation Payout

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 out the vacation liability amount owed to the employee across multiple vacation plan years or terms with a single payment. The vacation payout can be for a specific term, or across multiple terms.

Payout Without Vacation Accrual Reduction Date (Multiple Terms)

Create a vacation payout element and assign it to the employee.
When there's no Vacation Accrual Reduction Date provided, the payout includes the positive accrued liability for all vacation terms.
If an amount is entered on the payout element entry, the amount reduces the liability starting from the earliest term available accrued liability, until the amount is processed. If the amount is more than the accrued liability for all terms put together, the difference results in a negative liability for the current term, and the full amount is processed as a payout.
A negative amount entered on the payout element is ignored.

Payout With Vacation Accrual Reduction Date (Specific Term)

Create a vacation payout element and assign it to the employee.
If you enter a value in the Vacation Accrual Reduction Date field, the payout includes the accrued vacation liability balance for the specific vacation term in which the reduction date falls.
To pay out a partial accrued balance payment for a specific term, enter a value in the Vacation Accrual Reduction date field and the Amount field.
If an amount is entered with an invalid Vacation Accrual Reduction Date, the system behaves as if an amount was entered with no Vacation Accrual Reduction Date.
A negative amount entered on the payout element is ignored.

Vacation Absences

Vacation absences reduce the vacation liability. Vacation absences can reduce the vacation liability accumulated across multiple vacation terms, starting from the earliest term with a positive balance to the current term. Alternatively, they can be configured to reduce the liability for a specific term.

Absence Without Vacation Accrual Reduction Date (Multiple Terms)

If you don't enter a Vacation Accrual Reduction Date for the absence, the accrued liability is reduced from the earliest vacation term with a positive balance, to the most current term.
If the accrued liability is negative for a prior term, it’s ignored and isn’t reduced.
If any accrued liability remains after going through prior terms, the absence reduces the current term’s accrued liability, even if this results in a negative liability for the current term.
If the accrued liability is negative, or less than the absence balance for the current term, it is still reduced.

Absence With Vacation Accrual Reduction Date (Specific Term)

If you enter a Vacation Accrual Reduction Date for the absence, the accrued liability is reduced for the vacation term in which the reduction date falls.
If the Vacation Accrual Reduction Date is invalid (outside of the current plan dates), the liability is processed starting from the earliest vacation term and continues through the current term, or until the absence amount is consumed. Essentially, the system behaves as if there was no reduction date entered.
If the accrued liability for the term is negative or less than the absence balance, and if the Vacation Accrual Reduction Date is valid, the liability for the term is still reduced.