Page 112 - Essentials of Payroll: Management and Accounting

Payr oll Best Practices
every week on an ongoing basis. Some companies then take the addi-
tional step of accruing and tracking the usage of personal leave days,
which are essentially the same as vacation time, but tracked under a dif-
ferent name. By having both vacation and personal leave days, the pay-

roll staff has to track data in both categories, which doubles the work
required to simply track vacation time.
A reasonable, and easily implemented, best practice is to convert
personal leave days into vacation days and eliminate the extra category
of time off. By doing so, the payroll staff can cut in half the time
required to analyze employee vacation time. The only resistance to this
change usually comes from the human resources department, which

likes to offer a variety of benefits to match those offered by other com-
panies; for example, if a competitor offers personal leave days, then so
should the company.Though only a matter of semantics, this can cause
a problem with implementing the simpler system.

Cost:

Installation time:

Use Honor System to Track Vacation and Sick Time

It is common for the payroll staff to be in charge of tracking the vaca-
tion and sick time used by employees. This involves sending out forms
for employees to fill out whenever they take time off, usually requiring
their supervisor’s signature. Upon receipt, the payroll staff logs the used
time in the payroll system and files the forms in the employee personnel

folders. If the payroll staff does not account for this information cor-
rectly in the payroll system, employees will probably spot the problem
on their remittance advices the next time they are paid and will go to
the payroll office to look into the matter. These inquiries take up
accounting staff time, as does the paperwork-tracking effort.

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