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erica.paiero
July 8, 2020
Question

How do I add vacation pay to cheques that it was not applied to?

  • July 8, 2020
  • 3 replies
  • 0 views
I accidentally set up some employees without vacation pay applied to their first few cheques. It's corrected now, but how do I calculate and pay out the vacation pay for the missed weeks?

3 replies

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Nick K
July 8, 2020

Hi erica.paiero,

 

Making sure your employees are set up correct is important to make sure your payroll is going through correct. I can help point you in the right direction to get this resolved.

 

Due to the nature of your issue and there being a lot of variables such as type of payroll you are running, vacation policies you have set up or how it has been corrected I'd suggest getting in touch with our support team here.

 

Hope this was able to help.

LeithG
LeithG
July 9, 2020

Hi Erica:

 

The calculation: Depending on your jurisdiction, you need to determine the vacation is 4% (2 weeks), 6% (3 weeks), or something else.  https://www.employerline.ca/employer-advice-ontario/vacation-pay/?gclid=Cj0KCQjwgJv4BRCrARIsAB17JI7J1yH1Lu0yWW2krwjB2BzMIKtUtzFN_iyf78RiyHjV9HzHDvGczCcaAnD0EALw_wcB

 

Once you have that, simply multiply their Gross Pay (salary before tax, EI, and CPP deductions) by 0.04 or 0.06 (or the other percentage, as appropriate).

 

Now that you have the amount, what to do with it depends on how you deal with vacation.  Are they setup to accrue vacation, or is it supposed to be paid out on every pay check?  Either way the first step is to accrue the owing amount.

 

Accrual

Credit: Vacation Liability

Debit: Wages Expense

 

Payout

If you were supposed to pay it out on each paycheck, on the next payroll, you just then need to add these amounts to their paychecks, and update the employee payment history.

 

Hope this helps!

N
New to Desktop
February 21, 2023

I just noticed a former employee did not set up one of our newer employees vacation pay correctly.  He is supposed to get 4% paid out on each cheque.  I am currently working on his 3rd pay cheque.  I have made the appropriate changes in his employee payroll info so this cheque will be correct.  I went into the last 2 pay cheques and calculated 4% of his gross pay.  Can I go into the current pay cheque and add the amounts to the Vacation pay in the employee summary?

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Trish_T
February 21, 2023

Hi New to Desktop,

 

Thanks for joining us here.  It's important that you're employee is up to date with their vacation pay.  In this situation, you can add it to the current pay cheque.  When you're ready to run the scheduled payroll, select the Employee and then Open Pay Cheque Detail.  In the Company Summary, double click on the Amount and make the necessary change.  When you're ready hit Save & Close, then Continue with payroll.

 

If you require additional assistance, please don't hesitate to contact us.  It would be our pleasure to work with you in real time and ensure you're able to accomplish your QuickBooks Payroll goals as soon as possible!

 

If you have any other questions, please feel free to reach out again.  We're always happy to help!

 

 

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Andrea2204
February 5, 2022

How did you correct that?  I have the same problem where my new employees are set up to pay out vacation pay on every cheque but it didn't put any on it. 

Jen_D
Jen_D
February 5, 2022

Thanks for posting here, Andrea.

 

I want to make sure you're able to resolve this concern. If you're referring to paying your employees vacation pay, you can enter the vacation hours and not the dollar amount on the paycheque. The system then deducts the paid hours from the total vacation hours.

 

Here's how:

 

  1. Go to the Employees tab, then click Run Payroll.
  2. Fill out all other pay types and the vacation hours.
  3. Check Preview payroll and make sure to review vacation hours.
  4. Click on Submit payroll.


However, if you mean that the paycheque did not accrue hours, you can review the policy settings. See this set up to ensure the employee hours accrue every paycheck:

 

1. Go to Settings ⚙, then Payroll Settings.

2. Select Pay Schedules.

3. From the Vacation and Sick Leave Policies, section, select Create.

4. Select Vacation from the category drop-down menu.

5. Enter a Description that will help you select the correct policy when you set up employees.

6. In the Vacation Pay field, select whether vacation is paid out automatically or retained.

7. Select the Frequency that vacation time accrues.You can choose either of these:

  • Each pay period
  • Per hour worked

8. Enter the number of hours the employee can earn per year. Based on your selections, QuickBooks Payroll will automatically calculate the accrual rate for the employees assigned to this policy during the pay run.

9. Click OK.

 

For now, if the accrual is incorrect, you can create a vacation adjustment. To make an adjustment to an employee's vacation hours or dollar balance, go to the employee’s profile page. and select Make adjustments.

 

 

I'm adding a few related links to help you out:

 

 

Please update me if you need further assistance with this concern. I'll be right here to help you out. All the best!

 

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