Training Session 14 05 02 2021 Payroll 2 annual leave 1
Summary
TLDRThe script discusses the importance of annual leave for employees, emphasizing its accrual nature and the need for proper management to avoid large balances. It highlights the challenges of encouraging valuable employees to take time off and the financial implications of leave accumulation, especially when promotions occur. The speaker suggests adopting Serbian practices for leave planning and stresses the benefits of taking breaks for employee well-being and financial management.
Takeaways
- 📊 Annual leave is an entitlement for non-casual employees, accruing monthly and shown on pay slips.
- 🔢 A full-time employee is typically entitled to four weeks of annual leave per year.
- 🗓 There are regulations in some countries, like Serbia, about planning and taking leave within certain periods, which is not common in Australia.
- 🚫 In Australia, there's a lack of rules enforcing the use of annual leave, leading to some employees accruing excessive leave balances.
- 💡 It's crucial for employees to take leave to prevent stress and maintain a healthy work-life balance.
- 📉 High leave balances can be problematic, as they are difficult to reduce once accumulated.
- 💼 Finance professionals should be aware of high leave balances when reviewing clients' reports, as they can impact financial planning.
- 💰 When an employee gets a raise or promotion, their accrued leave is revalued at the new salary rate, increasing the company's financial liability.
- 🔄 Active management is required to ensure employees use their leave, especially for valuable employees who are hard to replace.
- 🏖 Taking a holiday is important for employee well-being and productivity, and should be encouraged by employers.
- 📈 For companies, reducing leave balances is important for financial health, especially when considering promotions and salary increases.
Q & A
What is the meaning of 'accrued' in the context of annual leave?
-In the context of annual leave, 'accrued' refers to the process of earning a certain amount of leave each month that is added to an employee's leave balance, which is then shown on their pay slip.
How is annual leave typically shown on an employee's pay slip?
-Annual leave is typically shown on an employee's pay slip as a separate item or as part of the pay advice, indicating the amount of leave that has been accrued and is available for use.
What is the standard amount of annual leave for a full-time employee?
-A full-time employee is typically entitled to four weeks of annual leave per year, as mentioned in the script.
Why is it important for employees to take their annual leave?
-It is important for employees to take their annual leave to prevent burnout and stress, as well as to maintain a healthy work-life balance, which is beneficial for both the individual and the company.
What challenges might arise if an employee accumulates too much annual leave?
-If an employee accumulates too much annual leave, it can lead to difficulties in managing their leave balance, potential stress from not taking breaks, and financial implications for the company if the leave is not taken and has to be paid out at a higher rate later.
What is the situation in Serbia regarding planning and taking annual leave?
-In Serbia, there are rules around planning and taking annual leave within a certain period of time, which is considered smart and something that could be beneficial if implemented in other countries like Australia.
Why is it difficult to manage the leave of highly valuable employees?
-It is difficult to manage the leave of highly valuable employees because they are often needed all the time, making it challenging to encourage them to take time off without disrupting the workflow of the company.
What is the financial implication of an employee's leave balance when they receive a pay raise or promotion?
-When an employee receives a pay raise or promotion, all of their accrued leave is recalculated at the new rate, which can have a significant financial impact on the company.
How can finance professionals use the information about an employee's leave balance?
-Finance professionals can use the information about an employee's leave balance to assess the financial health of a company, plan for future payouts, and ensure that employees are taking their leave in a way that is financially prudent.
What is the potential consequence of not actively managing an employee's leave balance?
-The potential consequence of not actively managing an employee's leave balance is that it can lead to a large accumulation of leave, which may become difficult to reduce and could result in significant financial liabilities for the company.
How can companies encourage employees to take their leave?
-Companies can encourage employees to take their leave by actively promoting the importance of taking breaks, setting up policies that require or incentivize the use of leave, and creating a culture that supports work-life balance.
Outlines
📅 Annual Leave Entitlement and Its Importance
This paragraph discusses the concept of annual leave, which is a right for employees who are not casual. It explains that annual leave is accrued monthly, meaning employees earn a certain amount of leave hours each month that are added to their total balance. This balance is reflected on their pay slips, which they receive with each payment. The speaker mentions that a full-time employee is entitled to four weeks of annual leave per year. They also highlight the issue of employees not taking enough leave, which can lead to a large accumulation of leave hours. This can be problematic, as it can affect both the employee's well-being and the company's finances. The speaker suggests that there should be rules similar to those in Serbia, where planning and taking leave is more structured. They also touch on the financial implications of leave balances, particularly when employees are promoted or their salaries are increased, as the old leave hours are then paid at the new, higher rate.
Mindmap
Keywords
💡Annual Leave
💡Accrued
💡Pay Slip
💡Full-Time Employee
💡Leave Balance
💡Stress
💡Promotion
💡Financial Perspective
💡Employee Welfare
💡Work-Life Balance
💡Leave Management
Highlights
Annual leave is an entitlement for employees that is accrued monthly.
Each month of work earns employees a certain amount of leave hours.
Accrued annual leave is reflected on the employee's pay slip.
A full-time employee is entitled to four weeks of annual leave per year.
There are rules in Serbia about planning and taking leave within a certain period.
In Australia, there is a lack of structured planning for taking leave.
Employees can accumulate excessive leave hours, such as 400 hours or more.
It's challenging to encourage valuable employees to take their leave.
Taking a holiday is crucial for reducing stress and maintaining well-being.
Accruing more leave than taken can lead to a difficult-to-reduce balance.
Finance professionals should consider leave balances when reviewing client reports.
Leave balances can affect financial considerations, such as salary increases.
When an employee's salary increases, their accrued leave is recalculated at the new rate.
It's important for clients to manage their leave balances to avoid financial implications.
Employees starting at a lower salary and progressing can have their leave recalculated at a higher rate.
Active management is needed to reduce excessive leave balances among employees.
The importance of taking breaks and resting is highlighted from both a personal and financial perspective.
Transcripts
um okay so uh
one of the entitlements that you would
have seen that everybody who
isn't a casual employee is entitled to
is annual leave
and annual leave is um accrued
and by accrued i mean um each month that
you work
as an employee um you get a certain
amount of hours which are banked
so to speak for you um and it's shown on
your pay slip
your pay slip is the pay advice that you
get when you get a payment
and then um you get to add to that um
tally each month and then as you take
and you'll leave
you're actually reducing it when we're
setting it up next week i'll show you
um you know what the rules are around
setting it up but just for now
know that a full-time employee will get
four weeks of
annual leave per year um i mentioned to
you before that in serbia there are
there are rules around
planning and taking your leave within a
certain period of time i think it's
actually quite smart
and i think that we should do something
like that in australia but unfortunately
we don't
we spend a lot of time planning and
encouraging
employees to take their leave so that
they don't end up with
400 hours like christina and i ended up
with 500 hours
because we never took leave but that's a
different case
we have some employees who entered up
with three 400 hours
we have to actively manage um getting
them to reduce it
generally they're the really valuable
employees that you need all the time
so it's really hard to give them up to
get them to take the leave but taking a
holiday is important
and when someone doesn't take a holiday
they get stressed it's not good for
anybody
and when you're not when you're accruing
more leave than what you're taking
you can almost never reduce the balance
so it's really important that
they do another consideration you know
as finance professionals for you to
consider when you're you know looking at
your clients
reports and some employees will just
send off a report
and not think about it but if you think
if you look at the numbers and you go oh
there's people here who have got a lot
of leave what you have to consider
um each time that you raise somebody's
pay or salary or they move into a
promotion or anything like that
all of the old leave that they had comes
out at the new rate
so it's another reason why i mean
there's a lot of reasons taking a break
and having time to rest is really
important
but also looking at it from a financial
perspective from your clients
perspective
it's important that they are reducing
that leave balance if they're
progressing people through their
um through through their company then
you know they might start off as a
junior on a very low salary
and work their way up after four years
and then all of those hours that they
didn't take
all are payable at the higher rate so
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