How are Entitlement Methods Calculated?
An entitlement is how many hours / days absence the employee is able to take for each period for example a holiday entitlement of 25 days per year. A period in Timegate Web is a year. Within Timegate Web, the period can be set up to run from any date. It will always end a year later. The period start date is dependent upon the business rules. The choice is yours as of to how you set this up:
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Set all employee period start dates to the 1st January
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Set all employee period start dates to the 1st April
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Set each individual employee’s period start date to be the same date as of which they joined the company
There are four different ways an entitlement can be calculated within Timegate Web. These are explained in the table below:
| Entitlement Method | Description of Entitlement / Method of Calculation |
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Defined (Default) |
Based upon the Entitlement Unit / UOM (Unit Of Measure), a given amount of absence per period (for example 28 days holiday a year). This may be for the given holiday period, if the entitlement type is fixed. If it is a Rolling type of entitlement it will be for the previous period
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Accrued |
This way of calculating entitlement is based upon the theory that absence entitlement is built up (or Accrued) as hours (or a value) that has been worked by an employee in the current holiday year (Fixed type) or previous (Rolling) year. The more hours an employee works, the more entitlement they earn. In Timegate Web, you enter a percentage for the rate at which absence entitlement is Accrued. in the case of current UK legislation, whereby 28 days holiday a year is the statutory minimum, the percentage you enter would be 12.07%1. The entitlement is calculated by looking at how many hours have been worked from the start of the absence period until the current date and multiplying that by the accrued percentage. For example if an employee has worked 800 hours to date within the current period, their entitlement would be 800 hours x 12.07% = 96.56 hours. When calculating using this method, it is important to enter the correct value. Often, users set this to 100% - thereby meaning that the employee has a hundred percent holiday!
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Contracted Multiplier |
The Contract Multiplier is used for working out absence entitlement on a pro-rata basis. The employee is entitled to x units (weeks) multiplied by the number of contracted hours or working days (depending on UOM of hours or days) of the employee as defined in Employee | Absence. For example the Contract Multiplier amount might be set to 5.6 weeks per year (28 days) the current UK statutory minimum (including public and bank holidays). The employee’s weekly working days or hours are then defined against their own employee record. If the rule is days and the working days is set to 4 (4 days per week), then their annual entitlement would be 5.6 weeks x 4 = 22.4 days. If the rule is set up as an hours rule, and they work 40 hours per week, then their entitlement would be 5.6 x 40 = 224 hours. |
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Contracted Multiplier Derived |
The Contracted Multiplier Derived method is used to counter problems with calculating entitlement with a simple Contract Multiplier. When using a simple Contracted Multiplier method to calculate absence entitlement, it doesn’t take into account that an employee may move from one contract to another. For example, if an employee moved from working three days a week to a four day a week pattern, unless a Timegate Web user remembers to change their working days, the employee would be penalised, i.e. their entitlement would be less than it should be. Alternatively, if they switched from four days to three days, their entitlement would be more than it should be. The Contracted Multiplier Derived method takes the employee contracted hours / working days (including diary events) each night as part of the daily balance overnight processing job, and uses these to work out the entitlement. The processing looks back over x weeks and determines the average hours and days per week the employee has worked. This gives a much more accurate view of their work pattern and their entitlement. Any changes are also audited against the employee when either the previous hours or days differed to those of the current day. This is capped at the maximum contracted hours / days. |