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Remember Me Roofing
Remember Me Roofing
May 4, 2020
Question

Employee wants me to save their 4% vacation pay for them

  • May 4, 2020
  • 1 reply
  • 0 views

Hi there.

 

I have two employees who are currently earning their 4% vacation pay on each paycheque. Their hours fluctuate week to week. They would like me to save their vacation pay for them and pay it out later, as a sort of savings plan to help them put money away for a rainy day.

 

I see that the only way to accrue vacation pay is but entering a set number of hours they earned. Because they don't work a set number of hours each week, there isn't a set number of vacation days they receive. I've read through other support posts and I haven't been able to find a workaround.

 

Is it possible to accrue vacation at a percentage and pay it out later? If not, can I create a deduction to add to their pay checks to deduct their vacation back from each pay check? I'm assuming I would have to update this amount each pay period, unless the employee agrees to me holding back a set dollar amount instead. When they do want this paid out, would I process it as a bonus and would the taxes get messed up?

 

Thanks for the help,

Tracey

1 reply

J
JamesM
May 4, 2020

Hi Tracey,

 

It makes sense for your employees to save their vacation and have it paid later. I'd be happy to share more info on how to do this in QB Online. 

 

To set up the vacation as a percentage, follow the steps below: 

 

1. Click the Employees tab on the left navigation menu.

2. Select an employee from the list.

3. Click the small Pencil icon next to Pay.

4. Click the small Pencil icon next to Question #4: "What is this employee's vacation policy?"

5. Select the option to "Receive vacation pay each pay period" 

6. Enter the percentage of gross wages the employee receives.

7. Click OK.

 

When it comes to paying out the vacation later you'd have to manually calculate it pay it out using the steps below: 

  1. Click on Employees tab.
  2. Click Run Payroll.
  3. Enter all other pay types and the vacation hours.
  4. Select Preview payroll and make sure to review vacation hours.
  5. Click on Submit payroll.

Note: Keep in mind that vacation hours can only calculated hourly. 

 

Here are some helpful resources related to vacation:

In case you have you other questions, feel free to reach out to support team using this link. 

Remember Me Roofing
Remember Me RoofingAuthor
May 5, 2020

Good Morning.

 

Thanks for the reply. The employee's vacation policies are already set to "Receive Vacation Pay Each Period" at 4%. It is calculated and added to their pay checks automatically. How do I stop it from being payed out and save it for later?

 

Thanks,

Tracey

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