Enter vacation pay
In Powerpay, you can enter vacation pay in three ways on the Employee Timesheet:
- Enter the vacation hours in the Hours section
- Enter dollar values in the Earnings section
- Pay out the entire amount in the vacation accumulator
For EACH of these three methods, you can choose to pay vacation pay as either time taken or time NOT taken.
In the Hours section, choose one of the following options from the list:
- Vacation Hrs - TT (time taken)
- Vacation Hrs - NTT (no time taken)
In the Earnings section, choose one of the following options from the list:
- Vacation $ - TT (time taken)
- Vacation $ - NTT (no time taken)
To pay out the Vacation Accumulator, choose one of the following options from the list:
- Yes - Time Taken
- Yes - No Time Taken
It is important to choose between NTT and TT because Employment Insurance considers vacation pay to be insurable. If vacation time is taken (employee is taking time off), BOTH hours and earnings are insurable and must be allocated to the correct pay period. If vacation time is NOT taken (employee is not taking time off), only the earnings are insurable for EI purposes and must be recorded in the pay period in which they are paid.
In most cases, if the vacation pay is being paid out on termination, only the earnings are insurable and are allocated to the last pay period in which the employee had regular insurable wages (the pay period in which the "Last Day Worked" falls). Select NTT in these cases.
By selecting the correct option (TT or NTT) when you pay out vacation pay, you are ensuring that Powerpay has the necessary information to produce an accurate Record of Employment (ROE) for that employee.
When Vacation NTT is paid without any current hours/earnings: change “Applicable Period of Time” to “No Time Taken Bonus Tax Method” and if the ROE has already been saved change “For which pay period” to “Last PPN worked”.
Note: For EI purposes and in order to produce accurate Record of Employments (ROE) it is important to choose the correct Vacation option for Time Taken or for No Time Taken. Time Taken is insurable for both dollars and hours, No Time Taken is just insurable for dollars.
Vacation pay scenarios
Use these topics to properly record vacation pay for different scenarios.
- Vacation Pay - Active employee, time taken, NOT entire accumulator
- Vacation Pay - Active employee, time taken, entire accumulator
- Vacation Pay - Active employee, NO time taken (just dollars $)
- Vacation Pay - Terminating employee, NO time taken
- Vacation Pay - Employee terminating or going on leave, time taken, NO current pay
- Vacation Pay - Employee terminating or going on leave, time taken, current pay
- Vacation Pay - Option for salaried employees