Length of Service adjustments to holiday

What is a length of service adjustment?

Length of service adjustments allow you to automatically grant additional pay or days of holiday/vacation entitlement to staff based on their length of service. This is helpful for if you have company rules where an employee receives more holiday the longer they remain with the company or receive a pay rise. This option increases holiday options in correlation with the length of service a Staff Member has been given.

Once set up, the length of time given will automatically adjust annually as the staff member’s length of service reaches the set threshold.

Setting up Length of Service adjustment for Holiday/Vacation

In this article we are going to explore, how to set up a length of service adjustment for holiday entitlemment.

The first thing you need to do is go to Pay > Contracts > LoS Holiday Entitlements. Then select 'Create a new entitlement group'. 

Step 1

Creating groups

The length of service adjustments are created using groups. So what is an entitlement group? 

Length of service adjustments are normally a series of escalations, so creating a group allows you to add multiple different milestones with different increases in entitlement. So for example, after one year, staff might  receive one extra day of holiday, and after two years of service they might be given two additional days of holiday. You can add as many entitlement points within the group as you want and they will apply automatically once you have added this entitlement group to your contract under holiday (which we will come back to later in this article). 

Using groups allows you to have multiple automatic length of service policies operating at the same time. Each contract can be assigned a different group if required.

Now we have gone through why it is helpful to have groups we will explain how to set this up.

First you will set a title for the group - this should relate to who you want the policy to apply to. This will depend on whether you have a company wide holiday policy or if the policy changes depending on department or level.

Next select the type of holiday you want this to apply to. This will be a drop down list of all holiday types currently in your system. You will most likely want to apply this to your main holiday entitlement.

Then finally, select when you want this policy to be enacted once assigned to a contract. Options here include; at the start of the entitlement year, on the continuous service anniversary or prorata additional entitlements and add them to the current year. Once you are happy, select save to move onto creating your adjustments.

Step 2

Creating adjustments

Once you have set up your details you will be taken to a new page. Under 'Years of service' add the number of yours the entitlement is for. This is the fully completed years of service at the start of the entitlement year the staff member will have done to receive the additional holiday entitlement. Then, add your Adjustment in Days. This means the number of additional holiday days they will receive upon completing this many years of service. Remember this will be ON TOP of base entitlement (ignoring previous LOS years). So, if the entitlement goes from 32 days to 35 days, the value input here would be 3. For hourly entitlements, the days will be converted to hours based on the contract's hours per day setting.

Note that the system will calculate their adjustment based on the length of service at the start of the holiday entitlement year.

Now you can continue adding more adjustments based on years. Like in the example below, this could be that staff are to receive one additional day of holiday after working for the company for five years, an additional two extra days after working for seven years and ten days for working there for ten years. The adjustments you add will be entirely dependant on your company policies.

It is worth noting that these additional days don't accumulate so at ten years the will have ten additional days on top of their base holiday. They will not receive their base holiday, + 10 days + 2 days from completing 7.5 years + 1 day from completing 5 years. The additional days will be 10 not 13.

Step 3

Assigning to a contract.

Once you have all of the different entitlements added, you can assign this to a contract. To do this go to Pay > Contracts > Manage Contracts and into Edit a contract. Under the Holiday tab, there is a section called Length Of Service Additional Entitlements, here select the correct length of service entitlement group.

This option will only come up if you are using a fixed holiday entitlement, pro rata (based on contract start and end dates).

Note: This will be in addition to any manual adjustments you have added to a staff member’s account. If you have Length of Service adjustments already then please discuss this with our support team who can help you migrate to this new feature.