CONTENT
- Adding holiday calculation method
- Holiday days accrual rule
- Holiday bonus days
- Paying holiday bonus
- Accruing holiday bonus
- Impact of employment condition on holiday bonus calculation
- Frequently asked questions
The special features of the municipal holiday calculation method have been taken into account in Netvisor with a ready-made salary model template and holiday calculation method. The special features concern the ways in which holiday days accrue and the earnings on which the amount of holiday pay and bonus is based. For the calculation of holiday pay and bonus, you can create a new salary type called "Actual pay," sourced from "employee's pay basis." The value stored in the employee's pay basis includes the salary types according to the municipal collective agreement. (For example, task-specific pay, personal bonus, and work experience allowance). Please note that no income type is assigned to the salary type, nor are accounting posting rules given.
The salary type is linked to the formula of the calculated salary type so that the salary type can be given the value "employee's pay basis." In the example image below, the salary type is linked to the formula of the "Calculated earnings from the holiday qualifying year" salary type.
Adding holiday calculation method
The municipal holiday calculation method can be added from the holiday calculation methods: Payroll > Settings > Holiday calculation settings > Holiday calculation methods > Add new holiday calculation method
Once the holiday calculation method is added, the formulas of the calculation method can be edited by clicking on the name of the holiday calculation method. To ensure that the price of the annual holiday day takes into account all the salary types that are included in the actual pay, the calculation formula must be edited. In the "salary types considered in earnings" section of the annual holiday day's price, the salary type "Actual pay" is changed.
In the formula for "Holiday bonus (Municipal holiday calculation method)" in the payable section, the salary type "Actual pay" is changed as shown in the image below.
Also, both in the "salary types considered in accrual earnings" and "holiday bonus accrual," the salary type "Actual pay" is changed as shown in the images below.
With these formula changes, holiday pay accrual is brought as close as possible to the actual holiday pay and bonus. As a result of the change, the earnings considered as actual pay during the holiday pay phase will be taken into account.
Holiday days accrual rule
Two new accrual rules are needed for the municipal holiday calculation method formulas, "Holiday days accrual rule: days / month" and "Holiday bonus percentage". These are added at: Payroll > Settings > Holiday calculation settings > Holiday accrual rules > "Add new rule"
The accrual rule Holiday days accrual rule: days / month is created with the following instructions:
- Provide the accrual rule with a "Rule name"
- Select the "Type" dropdown menu option "Holiday days accrual rule: day / month"
- Enter the number of holiday days accrued for a full holiday qualifying month in the "Annual holiday day" columns and save.
Holiday days accrual rule: day / month: The table defines the addition of holiday days accrued per month. The holiday month is interpreted through the accrual of holidays. The table interprets the duration of the employee's employment. Full holiday qualifying months always start from the beginning of the employment. If the employee has worked for over a year, full holiday qualifying months always start from the beginning of the holiday qualifying year, i.e., april.
In the implementation, if payroll starts, for example, in january and the january holiday accrual must be retrieved from holiday month ten, monthly holiday accruals must first be calculated from the current holiday qualifying year. If this is not done, holiday accrual will start from holiday month one.
The new accrual rule "Holiday bonus percentage" is created with the following instructions:
- Provide the accrual rule with a "Rule name"
- Select the "Type" dropdown menu option "Holiday bonus percentage"
- Enter the information in the "Employment months" column, indicating how many months the employment must have been valid for the holiday bonus percentage to apply
- Enter the percentage value in the "Holiday bonus percentage" column and save
Employees must have the holiday days accrual rule and holiday bonus percentage rule set in the "Annual holiday information" section of the Employee's basic information.
Holiday bonus days
In the municipal holiday calculation method, the calculation of holiday bonus is based on full holiday qualifying months. Therefore, for an employee who has chosen the "municipal holiday calculation method," holiday bonus days are not handled at all. Holiday bonus days do not accrue on the "Holiday accruals" view or the "Holiday pay debt" view. Holiday bonus days are not marked for payment in the "Check selected pay basis" view by entering the number of payable holiday bonus days in the "Payable holiday bonus days" field at all.
Paying holiday bonus
The municipal holiday calculation method's "Holiday bonus" salary type has a manual calculation, meaning this salary type is selected manually for the payslip. This way, you can choose on which payslip you want to pay the holiday bonus. So when paying the holiday bonus on the payslip, select the "Check selected pay basis" view, and include the Holiday bonus salary type in the calculation by selecting the salary type active from the "Salary types with manual calculation" section.
The amount of holiday bonus payable is calculated using the holiday calculation method formula, where the value of the "Actual pay" salary type stored in the pay basis is multiplied by the percentage of the "Holiday bonus percentage" rule selected for the employee. The result is multiplied by the employee's full holiday qualifying months from the previous holiday qualifying year.
Example of paying holiday bonus
Kaisa Kunnan has a value stored for the "Actual pay" salary type in her pay basis.
Kaisa has selected the Holiday bonus percentage rule in the Holiday entitlement management.
Kaisa's employment started on 1.1.2021. Working hours are not tracked in the Working hours entry function, and she does not have an employment condition set, so she accrues 12 full employment months for the holiday qualifying year 1.4.2021-31.3.2022.
Based on this information, she accrues a payable Holiday bonus of 1500 euros on her payslip from the previous holiday qualifying year.
Accruing holiday bonus
There is a separate calculation formula for accruing holiday bonus, where the portion of the employee's actual pay is calculated using the Holiday bonus percentage defined in the holiday accrual rules. You can check the resulting holiday bonus accrual in the payroll process on the "Payroll accountant view" tab.
Example of accruing holiday bonus
On Kaisa Karhu's payslip, the "Actual pay" salary type has a value of 2500 euros. Kaisa has selected a Holiday bonus percentage of 5% in the Holiday entitlement management. The accrual from two holiday days totaling 250 euros is visible on the "payroll accountant view" tab of the payslip.
Impact of employment condition on holiday bonus calculation
If working hours are not tracked in Netvisor with working hours entries and the employee's basic information has the employment condition set to "No condition," then all months during which the employment has been valid are calculated as full holiday qualifying months.
If working hours are tracked with working hours entries and the employee's basic information has the employment condition set to "14 days" or "35 hours," then all months in which the employment condition has been met during the processed holiday qualifying year are calculated as full holiday qualifying months.
Frequently asked questions
How do I enter the initial situation of the municipal holiday calculation method's holiday bonus in Netvisor?
In Netvisor, the initial situation of holiday bonus balances is entered as net "accrued holiday bonus," meaning the difference between accrued holiday bonus and already paid holiday bonus. This is because paid holiday bonus cannot be entered in the Payroll > Holidays > Taken and paid view columns, as they are grayed out.
How is the handling of holiday accruals done if employees have different holiday days accrual rules?
If an employee has a different holiday days accrual rule due to the duration of employment, a separate holiday accrual table must be built for this purpose. The employee's basic information defines which holiday days accrual rule is used at any given time. Setting and changing this is manual.
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