How to set a Time off Accrual Policy?

How to set a Time off Accrual Policy?

Partner HR can be configured to manage your staff's time off. It will track how much time off each person is entitled to, what the accrual period is, how much time off has been used, and the balance that is still available.

Employees with a status of "Inactive" or "Not Working," and Volunteer personnel types do not accrue hours through the time off accrual process.

1) Set up

In every employee's profile, make sure all employees have the correct "Hours Per Day" set in the Compensation section, and that their "Hire Date" is not in the future. 

2) Create the Policy

  1. Click on Settings > Templates

  2. Navigate to the Time Off Category 
    A quick way to navigate to the right category is to filter by the Category column!

  3. Select the Time Off Template you wish to edit. Click the New Policy button or select an existing policy. To explore the options for setting up Time off accrual policies, click here.

DO NOT turn on the "Process" flag yet and carefully read each option. Use the (?) icons for guidance.

Accruals - this refers to when days are added to the employee banks. Employees are continually earning time off, but the time is only added to their bank when those days are accrued per the policy settings. "No Automatic Processing" means the administrator needs to edit each employee manually to add hours to their bank.

Active - once a policy is active, a row will appear for that policy in the employee's bank and the Admin will be able to edit their bank. Initially, the bank is 0 and entitled days will be the default. These values can be manually edited.

3) Run the Preview report

When creating a Time off Accrual Policy, it is a good idea to run the Preview Report. Running the Preview Report:
  1. Determines the Accrual Date from the Policy settings. This is the latest date hours can be accrued. For example: if the accruals are applied Annually on January 1, the report will calculate the hours from the last time hours were added up until January 1st. (if no hours have been added it assumes a full period)
  2. Pulls all employees with an active status. If the policy is set to accrue on Employee Hire date instead of using the same date for everyone, the employee list is filtered down to employees whose hire day and month matches the accrual day and month.
  3. A policy record with a bank of 0 hours is created for any employee that doesn’t have one yet. The number of entitled hours comes from the policy rules.
  4. Calculates the number of hours that the employee accrued based on the policy settings.
  5. Takes the value from the policy or calculates the value based on years of service.
  6. Qualification rules are applied. If it is set in the policy, new employees accrue hours only after the probation period.
  7. Carryover rules are applied if set on the policy.

4) Review the report

After running the Preview Report, make any adjustments necessary on the employee profiles, such as hire date or hours per day, and rerun the report until it is correct. 

5) Process Time off Accrual

  1. Once the Preview Report shows exactly what it should, turn on the Process flag. 
  2. Once processing is complete, the Process flag can be turned off until next year.
Accruals are applied once per day at 8AM Eastern time. The Processor will only pick up policies that are Active and set to Process


If an Employee’s current bank is greater than their new bank, or if their current Entitled Hours per year are greater than their new Entitled Hours, no changes will be made. For example, if an employee has 10 hours in their bank and their new bank value is 5, the change will not go through.  If they are entitled to 100 hours and their new entitled hours would be 50, the change will not go through. 

If the administrator really wants to make this change, it can be done manually on the employee’s profile.

Whenever a change is made, the next accrual date is saved to the employee’s bank so they will know the next time earned hours will be added to their bank. If a bi-weekly policy was applied today, the next accrual date is updated on the policy to be two weeks from today. 

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