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Processing Leave in Payroll

How to record and pay employee leave during a pay run.

Updated over 3 months ago

Leave is processed as part of the normal pay run whenever an employee takes time off. SmoothPay automatically calculates balances and records the leave on the employee’s payslip.


How to Process Leave

  1. Go to the Payrun screen

  2. Select the employee

  3. Select the Leave Taken tab

  4. Select the leave type the employee is taking

  5. Review the leave balances

  6. Enter the amount of leave being taken

  7. Click OK or Next (differences depending on jurisdiction)

  8. Review the calculated pay

SmoothPay will:

  • Deduct the leave from the balance (once the pay process is complete)

  • Pay the employee for the time taken off

  • Display the leave on the payslip

  • Record the transaction in the employee’s leave history (once the pay process is complete)


How Leave Payment Rates Are Calculated

The rate paid for leave depends on:

  • The leave type classification

  • Your jurisdiction’s legislation

  • Employee contract settings

SmoothPay automatically applies the correct legal method based on the leave code classification and region settings. This does however require consideration in some jurisdictions, where the rules require ambiguous rules to be applied e.g. NZ with ADP or RDP


Processing Part-Period Leave

If the employee takes a partial amount of leave (for example, 3.5 hours or half a day):

  1. Enter the exact number of units taken

  2. SmoothPay will pay proportionally based on the employee’s ordinary rate or the required comparison

  3. The employee’s leave balance will reduce by the exact amount entered

Part-period leave can be entered in hours, days or weeks depending on the leave code configuration.


Recording Unpaid Leave

Not required for leave accruals, but can be used for tracking purposes. LWOP codes don't exist by default. You may need to create one within the Codes screen beforehand.

Process as you would with any other leave transaction but select the LWOP code

SmoothPay will:

  • Record the time taken

  • Apply no payment

  • Preserve an audit trail in the employee’s leave history


Public Holidays

By default SmoothPay should be set up with a Public holiday (not worked) leave code.

Process as you would with any other leave transaction but select the Public holiday (not worked) code.

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