Annual leaveThere are two methods of managing annual leave (also known as annual holidays) entitlements in MYOB Essentials: fixed and pro-rata. It's important to consider these carefully. All employees are entitled to a minimum of four weeks’ annual holidays each year after 12 months of continuous service. MYOB Essentials manages leave in hours, so you need to work out what an employee’s four week leave entitlement is in hours. When employees work the same, or a similar number of hours each week, this process is simple. For example, an employee who works 40 hours a week would receive 160 hours per year. With employees who work variable hours or a have a pattern that changes weekly, determining a four-week entitlement may not be as easy. When unclear, employers and employees can agree on what genuinely constitutes a working week, and then multiply this by four to arrive at an annual entitlement. One option is to use the longest working week as this will ensure the employee can take four weeks paid leave regardless of the weeks taken. Decisions on entitlements should always be made in accordance with good faith obligations and via engagement and agreement with employees. FixedWe recommend using this method which accrues the same amount of leave each pay period regardless of the hours worked. Work out the annual entitlement in hours and enter this in the hrs/year (fixed) field.
Each pay, a portion of the entitlement is added to the employees estimated leave accrued since anniversary and on the next leave anniversary date, the estimated accrued leave is given to the employee as available leave and the estimated leave accrued since anniversary resets to zero. It's important to check the employees receive their full entitlements. If required, you can update their balance using the available balance adjustment field. Pro-rataPro-rata is a leave accrual method which calculates an employee’s four weeks of leave based on the hours worked each pay. Historically, this method has been used when an employee’s hours varied across pay periods, so it was difficult to determine what a working week was for the purpose of annual leave. It’s important to note that this method isn’t defined within the Holidays Act and MBIE’s guidance cautions about its use, as there’s a risk that an employee may not receive their full four weeks of leave. While MYOB Essentials continues to support this method of leave calculation, we caution that it should only to be used when an agreement exists to use it and that its use should be reviewed regularly in case a work pattern has changed or becomes predictable. |