SmoothPay supports several leave accrual methods so jurisdictions with different legal requirements and employers with different working arrangements can apply the correct calculation model.
Each leave code determines which accrual method is used. The method affects how leave accrues, how it is reduced, and how balances are valued.
Annual anniversary accrual
Under this method, leave accrues once per year on the employee’s anniversary date. The full annual entitlement is added on that date.
How it works
The full entitlement is added when the next anniversary occurs.
No accrual occurs between anniversary dates.
Employees may be permitted to take leave in advance depending on legislation and policy.
The anniversary balance decreases when leave is used.
Common uses
Standard annual leave or holiday entitlements.
Jurisdictions that require full-year accrual only.
Continuous accrual (to-date accrual)
Continuous accrual increases the leave balance progressively as time passes. The employee earns a portion of their annual entitlement for each day between anniversaries.
How it works
Leave accrues daily based on time passed since the last anniversary.
This creates a growing to-date balance.
When the next anniversary occurs, the anniversary balance updates to match the to-date balance.
Leave taken reduces the to-date and anniversary balances accordingly.
Common uses
Jurisdictions requiring progressive (daily or per-pay-period) accrual.
Leave types needing accurate mid-year entitlement visibility.
Percentage per pay
Under this method, leave accrues as a percentage of hours worked or paid each pay period.
This method is purely transactional. There is no anniversary calculation.
How it works
Linked paycodes determine which hours count toward accrual.
Each pay, SmoothPay calculates:
Total hours of linked paycodes × Accrual rate = Leave accruedLeave balances increase or decrease directly based on transactions.
The balance is simply the total of all accruals minus all leave taken.
Common uses
Employees without standard working weeks.
Casuals or flexible-hour staff.
Jurisdictions where %-based accrual is required.
Which method should be used
The correct accrual method depends on:
Jurisdictional legislation
Leave classification
Employment agreements
Workplace policy
SmoothPay is preconfigured with the legally correct method for your region. You should only change the method if your organisation offers above-minimum entitlements or operates a non-standard accrual approach. Feel free to contact support