Offering your employees paid vacation time or paid sick leave isn't legally required by the Fair Labor Standards Act. But many small businesses offer some type of vacation and sick leave to be competitive with other businesses. For some general guidelines and advice, check Holidays and Vacations on the Department of Labor website or your state labor agency for more information.
If you do offer paid time off, you'll need to develop a company policy that says:
When employees can start accruing vacation and sick time:
Example: You may want employees to work for your company for one year before they accrue any vacation time at all.
How often they accrue hours.
Example: Eight hours every month or four hours every pay period. After a certain number of years with the company, employees get more paid vacation.
How many available hours employees can have at one time.
Example: To encourage employees to take regular breaks from work, you set up a vacation policy that places a limit on the number of available vacation hours. So, if you set the maximum number of available hours at 360 and an employee reaches that limit, then Ludt Payroll stops accruing any more hours until the employee takes a vacation and the available balance falls below 360.
To set up vacation and sick time for your employees in Ludt Payroll, you'll set up your company policies first and then apply the policies to your employees.
To pay employees for a holiday or bereavement time, set up a holiday pay type or a bereavement pay type.