What is an Accrual Policy?
Accrual Policies are Fingercheck's method of automatically tracking the amounts of hours employees have available to use towards specific kinds of absences from the workplace. Most commonly, this is applied towards concepts as Paid/Unpaid Time Off, Sick Leave, Vacation Leave, and FMLA/PFML, just to name a few.
It allows you to instruct Fingercheck on how many hours towards a specific bank, or "balance", an employee has access to at any given time. These hours can be "accrued" as a certain amount per hour worked (e.g. 1 hour for every 30 hours worked), or front-loaded all at once at a specific date. It also offers tools such as year-end rollovers/payouts, and filtering of specific employee groups.
In short, an Accrual Policy is a set of rules that determine how many hours of "absence credit" an employee accrues, and how often they accrue it.
Note that it does not automatically come with a way to "use" those hours- for that, you will need to create an Absence Policy after you create your Accrual Policy. Luckily, creating an Absence Policy is a very simple step, which you can read about here.
How do I set up an Accrual Policy?
To get to your company's Accrual Policies, first, log in to your Fingercheck user account, then click "Setup" on the main menu. In Setup, navigate over to Policies > Accrual Policies.
You'll see here a list of existing Accrual Policies for your company (or nothing, if this is your first time), and a button that says "Add". Click the "Add" button.
You'll be taken to a screen with a lot of different fields. Below is a list of all fields, with a description of what they do.
- Code: This is a short or abbreviated name for the Accrual Policy. This, in combination with the Description field, will determine the full name of the policy, as it will be displayed in other areas of Fingercheck.
- Description: This is a longer, more descriptive name for the Accrual Policy. This, in combination with the Code field, will determine the full name of the policy, as it will be displayed in other areas of Fingercheck.
(example: "Paid Time Off")
- Calculation Rule: In this field, you'll select whether the policy should accrue hours based on a Rate times Hours Worked model, or a specified Frequency.
- Hourly Process up to/Accrual Frequency: This field, depending on what you selected for Calculation Rule, will open up more options for fine-tuning the frequency of accruals.
(example: LastCompletedPeriodEnd, Weekly)
- Use Rehire Date: Check this box if you have employees who were terminated and then rehired, and you want to use those rehire dates as the start of their Accrual Periods (e.g. start of the new year for rollover options or anniversary-based Accruals).
- Display On Stub: Check this box if you want to display the amount of hours available for use on the employee's pay stub.
- Display Accrued Hours On Stub: Similarly, checking this box will display the amount of hours that was accrued during that pay period on the employee's pay stub.
- Use Paid Hours From Payroll: Check this box if you often manually enter employee's hours worked, and you want the accruals to trigger on those hours (Normally, Accruals do not calculate on manually entered hours).
- Fixed Accrual Day: In these fields, you can specify a specific Month/Day combo to calculate this policy's accrual rules.
- New Hire Pending Days: Here, you can enter a number of days in which hours accrued by new hires should go into the "Pending" balance, instead of the "Available" balance.
- Pending Rule: In here are options for when to move over pending balances after the New Hire Pending Days expires (if applicable).
- Fixed Pending Day: These fields will allow you to set a specific date for when "Pending" balances should be moved over to "Available" balances. This is meant to be used with the Pending Rule "FixedDayMonth"
- Rollover Rule: In here are options for "Rolling Over" hours from one accrual "Year" to the next.
Note that you should select something here even if you aren't planning on allowing any rollover, as this will dictate when the end of the "Accrual Period" is.
- Rollover Sequence: These are options specific to the situation of how accruals should be handled when the pay period occurs during the turn of the accrual "Year". You can select to Rollover then Accrue, or vice-versa. This order is important when considering limits on how many hours should be accrued within an Accrual "Year".
- Rollover Earning: This is the Earning Code to use if you want to pay out unused hours to the employee at the Rollover time.
- New Hire Filter: This setting tells Fingercheck which employees should have this Accrual Policy assigned to them automatically when their profiles are created. Note that this does not apply the policy to existing employees.
Below this is the PTO Rates section. Every Accrual Policy should have at least one of these, to instruct the system on how many hours to give during each period, as well as various limits; so you will need to add one. Here is an explanation of the fields on this screen.
- LOS Type: These are options for what kind of length of time this rule should be active for.
- LOS Number: In this field, enter a number that, combined with the "LOS Type" field, tells the system how long this rule should run for.
(example: If you want an always-running rule, set LOS Type to "Month" and LOS Number to 9999)
- Accrual Rate: In this field, you'll enter in the amount of hours to grant, per the Calculation Rule of the policy.
(e.g. if you enter "1" here, and your Calculation Rule is RatexHoursWorked, the policy will grant 1 accrued hour for every hour worked.)
- Max Per Accrual: The number entered here will be the highest amount of hours anyone using this policy can accrue in one period. A "0" here means no limit.
- Max Pending: The number entered here is the highest amount of hours that can be held in "Pending" status. "Pending" hours are hours which have been accrued, but cannot yet be used until the policy's Pending Rule has been satisfied. A "0" here means no limit.
- Max Allowed: The number entered here is the maximum amount of hours that can be held in an employee's "Balance". Hours in "Balance" are hours which have been accrued, and can be used towards Absences. A "0" here means no limit.
- Max Available: The number entered here is the maximum amount of hours that can be accrued between rollover dates. A "0" here means no limit.
- Max Carryover: The number entered here is the maximum amount of hours that can remain in an employee's "balance" after a rollover date passes. A "0" here means no limit.
- Filter: This field can be used to restrict this PTO Rate to a particular set of employees. To create a filter, go to Setup > Security > User Filters.
Lastly, there is the PTO Earnings section. In here, you'll want to select every Earning Code that this Accrual Policy should check for Earnings. Safe bets are the typical RG-Regular, SA-Salary, and OT-Overtime earning codes that are available by default on all companies, or any similar ones that you may have created.
State-Specific Accrual Policy Guides
As you've seen, Accrual Policies are one of the larger modules of Fingercheck, offering lots and lots of different options for different configurations for the different needs of different companies. We know that having so many options can easily make this policy type appear dense and overwhelming, so for your convenience, we have added here a list of states that have specific laws regarding minimum amounts of Paid Time Off/Sick Leave that all companies located in that state must offer their employees.
By clicking on your state in the list below, you'll be directed to a new page where you can read a step-by-step guide on how to create an Accrual Policy that satisfies your state's mandated minimums.
- New Jersey
- New York
- Rhode Island
Note: If your state is not listed here, this most likely means that the state has no specific guidelines or laws regarding Paid or Unpaid Time Off/Sick Leave. In these cases, you can refer to this article, which guides you through setting up an Accrual Policy compliant with the Family and Medical Leave Act (FMLA), a federal law signed in 1993 that provides job-protected, unpaid leave from work for certain family-related and other serious medical reasons, that is applicable to all employers within the United States.
If you have any further questions on this subject, you can reach out to our team at 1-800-610-9501, or, use our in-app messaging feature by logging into our secure site and initiating a conversation.
To learn more about our cost-effective and user-friendly cloud-based time and attendance software, check out our website at Fingercheck.com. Interested in our services? Sign up for a 30-day free trial and get started with FingerCheck today.