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The difference between Leave Pay and Late Leave Pay

Created on  | Last modified on 

Summary

How your payroll system applies Leave Pay and Late Leave Pay on Sage VIP Classic and Sage VIP Premier, when employees go on holiday.

Description

Leave Pay lets you pay employees their holiday pay in advance. The system multiplies deductions and contributions by the selected number of leave periods. It also calculates the statutory liabilities for the full leave period. When you activate leave pay, the system freezes the employee’s payslip until the employee returns from leave.

Late leave pay follows the same calculation rules, but it keeps payslips open for the next processing period after activation. This option helps when you still need to pay hours worked during the week before employees go on leave.

NOTE:

Your payroll company allows only one calculation method - standard Leave Pay, or Late Leave Pay. You won't be able to apply different calculations for employees. Change the Leave Pay calculation method in your company. 

When to use Leave Pay

Use Leave Pay when you're processing employees work hours for this week and leave payments in the current pay period.

  • The system freezes payslips from the next pay period
  • The system calculates wages, deductions and all contributions for the full leave period
  • The payslips activate for input in the week the employees return to work

EXAMPLE:

You activate three periods of Leave Pay. The system freezes the employee's payslip for the next three periods and processes all the leave pay, deductions and contributions upfront.

 

When to use Leave Late Pay

Use Late Leave Pay when processing employees work hours in the week before leave and only process those hours after they go on leave.
  • Late Leave Pay lets you process one extra period
  • Payslips don’t freeze in the first period after activation
  • Employees receive the final payslip once they return

EXAMPLE:

You activate three periods of Late Leave Pay. The company pays wages in arrears. The system lets you process one period before it freezes payslips for the remaining leave periods.