How do I configure the Leave Provision component?

This feature is available on all Deel Local Payroll powered by payspace payroll editions

One of the provisions of the BCEA is that annual leave can be taken when an employer and employee agree on the time/period of leave. Such an agreement is normally reached through the employer's internal leave application processes.

The Leave Provision component helps employers estimate the cost of paying out employees' leave entitlements—such as annual and long service leave—if employment ends. It is standard accounting practice to record monthly leave provisions based on the cash value of unused leave if all employees were paid out at that time. For example, a full-time monthly-paid employee earns 1.25 days of annual leave per month, based on the minimum 15 days per year.

The base of the component calculation is:

{EE Leave Days x [(System Default or Comp Income Base) / Days Per Period]} - Previous LTD Leave Provision

Use the following steps to configure the component:

Step 1: Add the Leave Provision component on company level. 

      Navigate > Configuration > Payroll > Payroll Config > Payroll Components

      

      

Step 2: Save the component (accepting the default calculation, which uses the BCEA income setup on the Leave Administration screen: ‘Leave Averaging Income Setup’.) or select "Income bases and formula" to set up your own income base on the leave provision component, based on your company  leave provision policy).

      

      

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