Vision 7.6 Benefit Accruals: Calculating Benefit Hours Based on Hours Worked

Do you have part-time employees in a state that requires benefit accruals based on the number of hours worked? Do you want to prorate employee vacation time when total hours worked is less than expected hours in a week? If so, then you will want to take advantage of new functionality in Vision 7.6 to calculate benefit accruals based on hours worked.

In this post, I’ll provide examples of how to set up calculations for different scenarios.

Once enabled within Accounting Company Settings, you are able to define the number of hours each employee will earn of vacation or sick time based on the number of hours they work. 

For example, you might have employees in a state with a requirement for the employee to earn one hour of sick time for each 30 hours worked.  Within the employee record, you can choose to calculate sick time earned based on hours worked and define the rate. In our example of earning one hour for every 30 hours, you would define an accrual rate of .0333.

If you want to calculate benefits based on hours worked, but do not want to allow an employee to earn vacation over a predefined value, you can set a maximum.

For example, an employee (40 hours/week) might have an expected benefit accrual based on earning two weeks of vacation for the year. The hours earned per hour worked would be 0.0385 (80 hours of vacation/2080 expected annual hours).  If you want to create a maximum for a benefit accrual frequency of weekly, you would enter 1.54 (.0385 hours times 40 expected hours). Even if the employee worked 50 hours in a week, they would max at earning 1.54 hours of vacation.

In addition, there might be hours that you want to exclude from the benefit accrual calculation.

For example, an employee may not earn vacation on vacation time taken or an employee may not earn sick time on short-term disability time taken. In these examples, you can define the time that should be excluded by selecting the appropriate projects associated with short-term disability.

Once the employee accruals are set up to calculate based on hours worked, you select the timesheets to include in the calculation during your regular benefit accrual processing. If you calculate benefits with payroll processing, the new functionality will calculate on all hours associated with payroll. 

For example, say an employee works 35 hours and is setup to earn 0.0385 vacation hours for each hour worked.  Benefit accrual processing will calculate 1.35 (35 hours *0.0385) for that accrual cycle.

For many users, this new functionality will replace manual calculations done outside of Vision, saving time and reducing errors.