Linking a wage category/pay item and adding leave exemptions

When you're setting up leave you might be prompted to link a wage category or check your exemptions.

Let's take a look at what these mean.

Linking a wage category

To ensure leave is paid and accrued correctly, you need:

• a wage category – this is used to pay the leave

• an entitlement category – this is used to work out how the leave accrues and updates leave balances when leave is taken.

Here's an example pay that shows the wage category being used to pay 7.6 hours of annual leave. It also shows how the entitlement category automatically calculates how much annual leave is being accrued on this pay.

To ensure the wage and entitlement categories work together, you need to link them when you set up the entitlement category. This tells AccountRight that when you use that linked wage category, for example to pay annual leave, the employee's leave balance will be adjusted accordingly.

Here's an example of the Annual Leave Accrual entitlement category that's linked to the Annual Leave Pay wage category.

Adding exemptions

If the Calculation basis in an entitlement category is set to Equals XX Percent of XX, the Exempt button is enabled.

This button allows you to choose any hourly-based wage categories that should be exempt (not included) in the leave accrual calculation.

For example, to prevent annual leave from accruing on overtime hours, you'd click Exempt in the annual leave entitlement category and choose the overtime wage categories.

Similarly, to prevent annual leave from accruing on holiday leave loading hours, you'd click Exempt in the annual leave entitlement category and choose the holiday leave loading wage category.

If you're not sure what (if anything) should be exempted from leave calculations, check with your accounting advisor.