Policy Type Settings Parameters

What is a Policy Type? A Policy Type represents a leave (paid or unpaid) that an employee may request. For each Policy Type, the employee can see the balance, how many days/hours were taken, how many days are booked, how many days were accrued (when applicable) and so on. Common Policy Types for employees include Holiday (Vacation), Sick, Parental Leave, Compassionate Leave, Work from Home and Unpaid Leave. The allowance calculations and validation of a given Policy Type will be determined by the Policy itself (not Policy Type).


Units:
This determines whether a given policy type is tracked in Days or Hours. The policies associated with this policy type will be subjected to the Units defined in the policy type.  That means that for a Policy Type defined in Hours, each and every policy amounts will also be handled in hours (annual allowance, carry over amount, maximum balance cap and so on). 

Policy Settings Parameters

What is a Policy? For each Policy Type, there may be one or more policies which define the set of rules and values for calculating an employee's allowance. A policy defines how allowance is accrued, what the limitations of usage are, carry over, and how years of changes update. An employee is always assigned to a given policy (for a given policy type) at a time. Example, for a policy type called Holiday, a given employee may be assigned to a policy called "Holiday 12 days grant," and then few months later to a new policy called "Holiday 16 days earned allowance" due to changes in his job, contract term, promotion and so on.

Note: when an employee requests time off, he requests time off for a Policy Type, not for a policy (the policy itself is not even visible to the employee). Per the example above, an employee will request Holiday, but the amount available and the validation of the request will be conducted based on the policy (for example, based on a policy called "Holiday 12 days grant").

Annual Grant: This grants the employee the full allowance at the beginning of the annual cycle. For example, if an employee is assigned to a 12-day holiday policy where the cycle is defined from January 1st - December 31st, then the 12 days will be given on January 1st, and will be at the disposal of the employee from day one. 

Keep in mind that since the full amount is given to the employee from day one, the employee can theoretically use all days; if terminated later that year, the employee does not "owe" the employer any paid holiday. There is no option for the system to prompt the Admin of such "abuse." Example: if the employee is entitled to 12 days of holiday, he may request all 12 days in January. If at some point later (say, February) the employee is terminated, there is nothing Admin can do about it. 

Earned Allowance: This is accrued along the employee's time off cycle frequency, where the annual amount is broken down into accruals. For example, a 12-day holiday policy defined as an "Earned Allowance" with a Monthly Time Off cycle will be broken down into 12 intervals (months), where the employee accrues one day each month. A 208-hour vacation policy defined as an "Earned Allowance" with a bi-weekly Time Off cycle will be broken down to 26 periods, where the employee accrues 8 hours each bi-weekly period. Within bob, there are two options for Earned Allowance. The default method is Prorated by Calendar Days, but there is also the option to select Not Prorated. Both options are detailed below:

Prorated by Calendar Days: The default option in bob. Here, earned allowances are subjected to the amount of days worked in a given Time Off cycle, and will be trimmed accordingly. In other words, if an employee only works for a portion of the accrual period, the employee will only be given a portion of the accrual.
Example:
Consider an employee on a Monthly cycle with a hire date of October 19th. If he is supposed to accrue 12 days of holiday per year (1 day per month), then in October he will only accrue 1 day * 19/31 days. This means that for the October accrual, he will only get 0.61 days and not the full amount of 1 day. This is also applicable to termination, when the employee does not finish the full cycle.  

Not prorated: In bob, earned allowances are given prorated by default, meaning that an employee will be given a fraction of the accrual based on the date he was assigned to the policy during the Time Off cycle and with respect to the day of termination. There is now the option to select Not Prorated, which will provide the employee with the entire accrual amount, even if the employee did not work for part of the accrual period. 

Unlimited Allowance: This type of allowance does not handle balance at all. The requests submitted by the user are not validated according to any balance calculation.

Annual Allowance: The employee is entitled to a fixed amount of Time Off each year.

Allowance in Hours by Hours Worked: This is a new policy accrual option, available only to clients who have both the Time Off and Time & Attendance modules. Helpful for part-time employees who accumulate hours based on total work time in a given period, this option allows you to define a ratio where an employee must work a given amount of hours to receive 1 hour of Time Off. It is also possible to define a cap to the received Time Off. Accrual is granted upon attendance sheet approval. For example, for a policy defined with a ratio of 18, if an employee works 180 hours, then that employee will receive 10 hours of Time Off. 

Carryover: The ability to take days with you into the next year (or follow up yearly cycle). 

Carry over expiration: For a policy where carryover remaining balance to next year is enabled, you can limit the amount of time (in months) the remaining balance is accrued before it is lost. 

Please note: 

  1. Carryover expiration is set in amount of months (maximum 12 months of carryover)
  2. Carryover expiration is supported only when the time off cycle is set to Annual.

Maximum Balance Cap: This allows the Admin to set an upper limit to the amount of days/hours a given employee can have for a given policy. Example: if the maximum balance for Holiday is defined as 18 days and the employee's current balance is 17 days, should the employee accrue another 2 days (next month), then only one day will be added to the employee's balance, as he may not exceed the 18-day balance cap. 

Negative Balance: This allows the Admin to define whether an employee can get into a negative balance. If reaching a negative balance is allowed, the Admin can define the limit of negative balance allowed (negative value will be defined). Example: if, for a given policy, employees can get up to 5 days of negative balance, the Admin will set the value to -5. If a negative balance is not allowed, set the value to 0.

Grant Time Off Based on Years of Service: When the annual allowance gradually increases based on the employee's seniority, tick this checkbox and define the annual allowance change for given years of service. Example: for a starting annual allowance of 12 days, after 1 year, this balance may change to 14, after 2 years to 16, and so on.

Override Annual Balance Settings: This parameter allows the Admin to manipulate how the policy shows annual allowance: either on an annual basis (by the end of the cycle), or as "Annual (with monthly accruals)," which will show the annual allowance "broken down" in a monthly display, where the total annual allowance is "accrued" based on the end of each month. Example: for a given site, the cycle is defined as Annual (from April -  March). If a given holiday policy is set to override the site's annual balance settings so that it shows it as "Annual (with monthly accruals)," then the full amount will be "accrued" progressively. If employee is supposed to get 12 days of holiday, instead of showing all 12 days only at the end of March, in May of the current cycle it will display that 2 days were already accrued (one day for April, and one day for March).

Prorate allowance for part time employees: For hourly policies, the system will prorate the allowance based on the employee's work pattern with respect to the employees' %FTE. If a full time employee's annual allowance is set to 208 hours, then for an employee whose FTE% is 50%, the employee will accrue only 50% of the amount (here, only 104 hours). In addition, deducting the approved day will also consider the nominal day's length as defined by this employee's work pattern. So if a full day's nominal length is 9 hours, and the employee's expected daily pattern for the day he requests a holiday is only 4 hours long, the request will deduct 4 hours from the balance and not 9 hours. 

Time Off Cycles

What is a Time Off cycle? In order to manage the timeline of the events associated with Time Off (such as accrual calculation, balance change, carry over and so on), an Admin needs to define a Time Off cycle: typically a yearly interval with a start and end date where policies are tracked, balances are calculated, and requests are deducted from the balance. Once the cycle ends (given the employee remains an active employee), a new cycle begins.

About Cycles

  1. Currently in bob, a cycle is defined at the level of the Site. This means that all the policies a given employee is assigned to will conform to the cycle type defined in the site the employee belongs to. Example, if the Time Off cycle is defined as Monthly cycle, then Holiday, Sick, Work From Home and Compassionate Leave will all be tracked on a monthly basis (Monthly cycle).
  2. The following Time Off cycles are available in bob: 
  • Annual
  • Monthly
  • Semi-monthly
  • Bi-weekly
  • Weekly

How should I determine which cycle to use? There are several factors to guide you as to the cycle that should be set (given the limitation of setting only one cycle per site):

  • Legislation: If an employee is entitled to the full amount of holiday from day one, then setting an Annual cycle is satisfactory. If the employee earns his allowance progressively along the year, where the employee accrues a portion of the annual allowance each period, then a higher frequency cycle (such as Monthly or Semi-monthly) should be used.
  • Payroll Frequency: In many cases, the Time Off accrual frequency should match the payroll frequency, as many payroll systems require that the total accrued days/hours,  end-of-period balance, and total used days/hours are exported to payroll. For example, for a U.S. customer who runs payroll on a Semi-monthly basis, setting a Semi-monthly time off cycle makes sense. That means that for the 26 payroll cycles in a given year, there will be 26 Time Off cycles.
  • Time and Attendance: Another factor (that also has to do with payroll frequency) is whether time and attendance are enabled in the site (where employees report their attendance and submit their timesheets and export their records to payroll on payroll time). In this case, it makes sense to align the Time Off cycle with the defined time and attendance cycle. For more information about T&A cycles, please refer to https://help.hibob.com/en/articles/1917282-understanding-t-a-settings.

Time Off Activity Period Definitions

To setup a cycle and define its parameters, go to Site > Setting > Site's Cycle Definitions.

Balance Closing Frequency:
The Admin can set the type of cycle to be assigned to the site (Annual, Monthly, Semi-monthly, Bi-weekly or Weekly cycles) 

Annual Cycle Parameters

Activity Period: this will define the annual cycle tracking from/to from the 1st day of a given month. Example, in Finland holiday cycle starts from April and ends on the following end of March. So in this scenario, set the Activity Period to Apr - Mar

Another option to set the Activity Period (found at the bottom of the drop down menu) is by the employees' anniversary date. By selecting "Starts every employee anniversary", each cycle will start on the employees's anniversary and end on the following year anniversary. For example, an employee's hire date is 10/28/2016. This means that each cycle will start on 10/28 and end on the following year on 10/27.

Closing Date Delay (days): This parameter defines a grace period (cutoff) after the cycle ends, where the Time Off cycle can still be updated with Time Off requests before it is locked and no changes can be made. The cutoff time will be set based on the value entered with respect to the Activity Period. Example: for an annual cycle with Activity Period set to Jan - Dec, setting a value of 8 means that up to the following January 8th, the previous cycle can still be updated. So for the 01/01/2019 - 12/31/2019, changes can be made until 02/08/2020.

Please note: entering 0 (zero) means that there is no grace period (cutoff time) and the cycle is locked automatically on the last day of the month (defined in the activity period).  

Balance Displayed As Of: For an annual cycle that is defined from a given month to month (not based on employee's anniversary), there is an option to add more "up-to-date" displays of the balance. There are two options:

  • End of cycle (selected by default): This shows the annual balance with respect to the annual cycle end date. Example: for an Annual cycle defined from April - March, the balance will be shown at the end of March. For an employee who earns 12 days of annual allowance, the balance will show the 12 days at the end of March.
  • Today (with monthly accrual): This shows the balance as accumulated up to the current month and not the expected balance by the end of the annual cycle. Example: for an Annual cycle defined from April - March, for an employee who earns  12 days of annual allowance, if today it is July 15th, then the balance will be displayed as of the end of July. This means that the 12 days will be "accrued" on a monthly display and the employee will see (as of the end of July) 4 days of holiday balance (1 day each for April, May, June and July). This view provides a more accurate Year-to-date view of the balance.

Monthly Cycle Parameters

Accrual Balance Period: This parameter states that the accrual will be added on a monthly basis, accrued at the end of each month.

Annual Carryover and Grant Date: This defines the month (first day of the month) the yearly cycle will be determined when it comes to carrying over the remaining balance from the previous year and granting employees with annual grant (for policies whose allowance calculation is set to Annual Grant). Example: by setting this parameter to August 1st, then every year on August 1st, carryover of remaining balance (from previous August - July) will be conducted and if Annual Grant is given, it will be given on August 1st. This parameter essentially defines the activity period for a monthly cycle. In the example above, the monthly cycle has a tracking year from August - July.

Closing Date Delay (days): This is similar behaviour as the Annual cycle (see above), only it will lock the monthly cycle X days after the end date (as defined in the Activity Period below). The Closing Date Delay parameter is defined with respect to the Activity Period and has nothing to do with the Accrual Balance Period.

Activity Period: This defines the monthly cycle start and end time, during which Time Off requests can be made, balance can be adjusted, and so on. Example: defining the Activity Period as "25th - 24th" means that the Time Off cycle will start every month on the 25th, and end the following month on the 24th (for example, 12/25 - 01/24).

Note: This parameter should not be confused with the "Accrual Balance Period," which only defines when the accrual will be given (which is currently set to end-of-month only, and has nothing to with the Activity Period).

Semi-Monthly Cycle Parameters

Cycle Starts on Every: For a Semi-monthly cycle, define the two days in the month where the two Semi-monthly cycles should start. Example: setting "1st & 16th" means that each month will have a Semi-monthly cycle from the 1st - 15th, and another from the 16th - end of the month. On a typical February, for example, the the cycles will be 02/01 - 02/15 and 02/16 - 02/28. On a leap year, the second cycle (in February) will be 02/16 - 02/29.

Annual Carryover and Grant Date: See above (similar behaviour to Monthly cycle).

Closing Date Delay (days): This defines the grace period when previous Semi-monthly cycles can still be updated. Example: with a value of 5, for a Semi-monthly cycle defined from 06/16 - 06/30, changes can be made up to 07/05 and then the cycle will be locked.

Bi-weekly Cycle Parameters

First Cycle Starts On: This serves as the anchor date from which the system will generate Bi-weekly cycles. The Admin will be directed to a date picker and prompted to define the first Bi-weekly cycle to be tracked in the system. bob allows the Admin to define any date up to an offset of 13 days as of today. Example: if today is January 6th, the earliest Bi-weekly cycle that can be defined is December 24th. 

Annual Carryover and Grant Date: See above (similar behaviour to Monthly cycle).

Closing Date Delay (days): This defines the grace period when the previous Bi-weekly cycle can still be updated. Example: with a value of 4, for a Bi-weekly cycle defined from 12/30/2019 - 01/12/2020, changes can be made up to 01/16/2020, and then the cycle will be locked.

Weekly Cycle Parameters


Weekly Cycle Starts Every: This defines the day of the week every weekly cycle will start. For example, setting a Wednesday means that every weekly cycle will start on Wednesday and end on the following Tuesday.

Annual Carryover and Grant date: See above (similar behaviour to Monthly cycle).

Closing Date Delay (days): This defines the grace period when previous Weekly cycle can still be updated. Example: with a value of 2, for a Weekly cycle defined to start every Wednesday (ending on the following Tuesday), changes can be made up to the following Thursday.


Rounding

Regardless which cycle is set, the balance can be rounded based on the following parameters:

Round Balance: This determines how balance will be rounded - either Up or Nearest.

  • Up rounds the balance up to the nearest value based on the precision set (see below).
  • Nearest rounds the balance to the nearest value based on the precision set (see below).

Example: the system is set to show up to two decimals when it comes to precision. If an employee's calculated holiday balance is 17.157 days:
Rounding Up will round the balance to 17.16 days
Rounding Nearest will round the balance decimal (one decimal place) to 17.2 days

Precision: Determines the rounding resolution.

  • 1 decimal place: a balance of 17.25 will be rounded to 17.3 (Up) or 17.2 (Nearest)
  • 2 decimal places: a balance of 17.255 will be rounded to 17.26 (Up) or 17.25 (Nearest)
  • Half: a balance of 17.25 will be rounded to 17.00 
  • Whole number: a balance of 17.255 will be rounded to 20 (Up) or 17 (Nearest)

End User: Time Off Terminology

Days used: The number of days the employee has used from their allowance

Holiday balance: The amount of leave available. The amount of time off the employee has remaining can be affected by 2 exceptions: Time Off requests, which are deducted from the balance, and Adjustment, which is when administrators override the balance

Who’s out today: The number (and identity) of employees that are absent on a specified day, and the reason they are out

Pending requests: The Time Off requests waiting for your approval

Report on behalf: The ability of a manager or admin to take time off on behalf of one of the employees

Adjust Time-Off: The ability to add/edit (on top of existing policy allowance) specific time for a specific employee (e.g. if someone worked at the weekend, we can give them time off in lieu).

Holiday balance: The amount of Time Off the employee has left from the previous period

Holiday balance previous period: The amount of Time Off the employee has left from the previous period

Holiday balance effective date: The date the balance is effective, formatted in DD/MM/YYYY. If not filled, then the default effective date to be used is the import date 

Holiday days used: The amount of Time Off already used by the employee

Sick balance: Number of sick days the employee has left from the previous period

Sick balance effective date: The date the balance is effective, formatted in DD/MM/YYYY. If not filled, then the default effective date to be used is the import date

Sick balance previous period: Number of sick days the employee has left from the previous period

Sick days used: Number of sick days already used by the employee

Annual Allowance: this shows the employee his annual allowance entitlement. It does not mean that this is the employee's current allowance, but a note as to the policy the employee is assigned to (in terms of entitlement).

Days/Hours Accrued:
Based on the policy allowance calculations, will show the amount of days/hours the employee accrued for within the given time off cycle. It will show the date the accrual was given and the timeframe (the date range) for which this accrual is applicable.

Days/Hours Booked: These are requests that were submitted for the current cycle but as of today are still in the future (although they are deducted from the current balance). Example, if the current Time Off cycle is 12/25/2019 -  01/24/2020, and today it is 01/05/2020, a request for 2 days on 01/16/2020 - 01/17/2020 will show as 2 days booked and will be deducted from the current balance. 

Admin Adjustments: Anytime Admin/Manager make a manual adjustment such as Balance Adjustment or manually add days, the value that was adjusted will show.

Expected Deduction: This provides the user with information that he should better book his remaining days/hours for the given policy type or he will lose them by the end of the cycle. The value will be determined by the Carryover definitions or balance cap limitations defined in the policy setting.

That's it!

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