Enhanced Holiday Pay allows you to calculate holiday pay based on average earnings. You can record annual leave, generate calculations, and view pay history.
If you use Enhanced Holiday Pay, you need to update your annual leave start and end dates each year. This ensures that the system applies the correct entitlement period.
Failing to update these dates will cause the system to continue using the previous year's entitlements instead of resetting for the new holiday year.
How the system works
When you set up Enhanced Holiday Pay, you enter your holiday year dates (for example, 1 January 2024 to 31 December 2024). The system uses these dates to determine which entitlement to deduct when an employee takes a holiday.
The system provides a 12-month grace period, during which it automatically rolls forward your entitlement dates by one year.
For example:
If your parameters are set to 1 January 2024 to 31 December 2024:
An employee taking holiday in December 2024 will use the 2024 entitlement.
The same employee taking holiday in January 2025 will automatically use the 2025 entitlement.
However, this automatic roll-forward only applies for one additional year. If you do not update the Parameter screen:
Using the same parameters: 1 January 2024 to 31 December 2024:
If an employee takes a holiday in January 2026, the system cannot roll forward a second time, and it will incorrectly deduct from the 2025 entitlement instead of the 2026 entitlement.
When to update your dates
Update your annual leave start and end dates during the first or second pay period of your new holiday year.
Although you have a 12-month grace period from the end of your old holiday year to the end of your new holiday year to make this change, updating early in the new year helps prevent processing issues.
To update your dates, follow the steps below.
From the dashboard menu, select Payroll Dashboard.
Click Settings then under Codes, click Enhanced Holiday Pay.
Click Pay Group Parameters tab.
For each pay group, review your annual leave start date and annual leave end date.
For the relevant pay group, update both dates to reflect your current holiday year.
Example:
Current parameters: 1 January 2024 to 31 December 2024.
Update to: 1 January 2026 to 31 December 2026.
What happens if dates are not updated
If you do not update your dates within the grace period, the system will continue to use the previous year’s entitlement. This will lead to:
Employees potentially exhausting their holiday entitlement incorrectly.
Enhanced Holiday Pay calculations referencing the wrong entitlement year.
You needing to manually correct affected payments.
Recommended action
If you still have your holiday years set to 2024, check the following as a proactive measure:
Check your Enhanced Holiday Pay setup screen and review the Pay Group Parameters tab.
Verify that your annual leave start date and annual leave end date are within the current year.
Update the dates if they reflect a previous year.