Give yourself a break: get holiday pay sorted early in NZ
Silly season is officially upon us – the crazy queues in malls, people frantically doing their Christmas shopping, Christmas carols being played everywhere, and the Christmas trees being put up at home.
As well as playing your part in the festive frivolity, it’s important, before you finish up on your last day of work before the break, you make sure leave has been entered and employees are being paid correctly.
Here’s help with answers to some of the most common payroll questions we get asked around Christmas time:
How do I pay my employees all their holiday pay?
Your permanent employees are paid annual leave via an annual leave request for the number of hours they’ll be on leave. Leave requests can be submitted on behalf of an employee from the employee’s Leave tab. Once approved, the amount of annual leave is shown in the next pay run. See how to submit and approve a leave request.
It’s not possible to pay out holiday pay as such. The holiday pay figure in Xero shows 8% of an employee’s total gross earnings for their current anniversary year. It doesn’t reduce as they take annual leave. See how Xero manages annual leave and holiday pay for employees.
How do I know how many hours of annual leave my employee can take in advance of their next anniversary?
Just make sure the checkbox for the option Include leave available to take in advance in the balance is ticked – it’s ticked by default for all new employees. See how to manage annual leave and holiday pay for employees in Xero.
Why isn’t the public holiday line showing in some of my employee’s pay runs or payslips?
It sounds like the holiday group is either not set, or was set after the draft pay run was created. If it’s not set, simply set it in the employee’s Employment tab. If it was set after the draft pay run was created, then all you need to do is to select Reset Payslip in the employee’s draft pay run. See how to manage holiday groups.
If my employees are working the public holidays, how do I pay them and how do I give them the alternative holidays?
To pay an employee for working a public holiday, you can add a new earnings pay item and assign it to the employee. To update the alternative holidays balance, go to the employee’s draft pay run.
See detailed instructions for paying an employee for working a public holiday here.
My company has an annual closedown. How do I pay the employees all their leave and holiday pay?
If your company has an annual closedown, you’ll need to process annual leave for your employees for the closedown period. See how to set up payroll and leave for annual closedown in New Zealand.
It’s not possible to pay out holiday pay as such. The holiday pay figure in Xero shows 8% of an employee’s total gross earnings for their current anniversary year. It doesn’t reduce as they take annual leave. See how Xero manages annual leave and holiday pay for employees.
Why is my employee’s annual leave pay rate higher than usual?
Annual leave is paid at the higher of ordinary weekly pay or average weekly earnings, which is why the employee’s annual leave rate can sometimes be higher than their hourly rate. See the official guidance on calculating payments for holidays and leave.
The ordinary weekly pay calculation uses the information from the Employment and Pay Template tabs, and the average weekly earnings calculation uses info from the Opening Balances tab plus the pay runs that have been processed in Xero.
Can I process payroll in advance?
Certainly! As long as it is a normal, scheduled pay run, the pay calendar will automatically roll forward.
If you have any other questions, check out Xero Central for heaps more content about payroll. Have a safe, fun and festive holiday!
The post Give yourself a break: get holiday pay sorted early in NZ appeared first on Xero Blog.
Source: Xero Blog
