First, click into the Time Off app and click Get Started. You'll be directed to the Time Off setup workflow, which will guide you step by step through configuring your company's
paid time off policies in Zenefits.
An in product walk through is also available to guide you step by step in Zenefits.
Step 1: Holidays
Here, you'll select which holidays your workers will be paid for over the course of the calendar year. Zenefits will pre-populated the most common paid holidays. To remove a holiday that your company
does not offer, uncheck the box to the left of the holiday name. To add any holidays that your company offers that are not already included, click the +Add a Holiday link in the bottom left hand corner
of your screen.
The list of holidays on the landing page will apply to the current calendar year. To edit holidays for a future calendar year, click the arrow to the right of the year in the upper right hand corner of the page.
Things to note:
- These are paid holidays, not days where the company is closed but staff is not paid. If workers are assigned to a policy that includes a paid holiday, the hours for that holiday will flow into Payroll for that period as paid time off.
- Zenefits does not support floating holidays in the Time Off holiday calendar.
Step 2: Hours and Work week
Standard Hours: This is the number of hours your workers typically work in one day. For most companies, one work day is equal to 8 hours.
Balances and accruals are tracked in Zenefits in terms of hours, not days. The number of hours entered for Standard Hours will indicate how many PTO hours are debited from worker Time Off balances for each day that is requested off.
Work Week: These are the days of the week that the company typically is open and has people working. Most companies have a standard work week of Monday through Friday.
Work week will indicate which days are considered to be paid time off. For example, with a standard work week of Monday through Friday, a Friday through Monday time off request would debit two days worth of hours from the balance. With a standard work
week of Sunday through Monday, the same Friday through Monday request would debit four days worth of hours from the balance.
Things to note:
- If your company is open 7 days a week, employees should only submit paid time off requests for days when they would otherwise be working.
- For example, say an employee usually has Monday and Tuesday off. That employee should only submit Paid Time Off requests for Wednesdays through Sundays because it's already expected that they will not be working Monday or Tuesday. If they were to
submit a request for Sunday, Monday, Tuesday, and Wednesday, they would be wrongfully debited for 4 days of paid time off instead of 2.
Step 3: Types and Reasons
Types: These are the different time off accrual buckets your company utilizes. Zenefits allows up to 3 PTO types within each policy. Each type can carry its own set of accrual rules, carryover rules, and blackout dates. Additionally, workers will
carry separate balances for each time off type.
Many companies utilize 3 buckets for Vacation, Sick, and Personal Leave, while others choose to use one accrual bucket for all types of paid time off. It is important to consider location-specific sick leave requirements when choosing which types to include in the company's policy.
Reasons: These allow you to track time off at a more granular level. Reasons can pull out of the accrual bucket types, or they can be Not Counted, allowing you to track the requests through Zenefits without debiting time off from balances.
Work from Home, Jury Duty and Bereavement are three common Not Counted paid time off reasons. For companies that only accrue paid time off in one bucket, many like to include Sick, Personal Leave, and Vacation as reasons that pull out of the balance carried
by the type. Unpaid Time Off can also be tracked as a Not Counted reason.
Things to note:
- Renaming types- you can rename PTO types to change what your workers see when they submit Time Off requests. However, when you look at balances or pull reports from Zenefits, the names will reflect the Zenefits given name for each type (Vacation, Sick, or Personal Leave).
- Which type should I use? If you use the Vacation type, Time Off liabilities will calculate automatically. If your company only uses one type for all paid time off, it is a best practice to use the Vacation type in Zenefits.
- Not counted reasons and payroll - Not Counted reasons will not feed into Payroll as paid time off.
- What will my workers see? When your workers submit a Time Off request, the dropdown menu will include both Types and Reasons. For example, if you use the Vacation type and rename it Paid Time Off, and include
Vacation, Sick, Personal Leave, Work from Home, and Jury Duty reasons, your workers would see the following options when submitting their requests:
- Paid Time Off
- Personal Leave
- Work from Home
- Jury Duty
Step 4: Time Off Rules
You'll have the option to choose between three options for each set of rules you configure in your policy including Unlimited, 10 Day, and Custom Policy. To select one of these options, you must click in the box around
the rule set and then click the Save & Continue button.
Unlimited: This flexible time off policy allows you to track time off without accrual and without workers carrying balances. You cannot edit the rules associated with this policy.
10 Day: This standard policy includes 10 days of paid time off per year accrued semi-monthly on the first day of each period. You can edit
the rules associated with this policy.
Custom Policy: This policy allows you to customize the rules to meet your company's needs.
- Accrual Method: Unlimited or Days per year. How many days per year will your workers accrue on this paid time off policy?
- Tenure Accrual Rate: Are workers awarded additional paid time off based on their tenure at the company? If so, click the Add a Tenure Accrual Rate button. If the standard accrual rate is 20
days per year and, at their 10 year anniversary they are awarded an extra 5 days per year, enter "10" for years worked and "5" days per year.
- You can choose whether you want accrual to be based on the calendar year, the employee's hire date anniversary, or a custom policy year using the settings included in this section.
- Maximum Balance: This is the maximum balance workers are allowed to carry at one time. Before you can enter a maximum balance number.
- Annual Reset: An annual reset will clear all workers' balances to 0 on the policy year start date. If you want to allow any type of carryover, leave the Resets Accrual Annually box unchecked.
- Carryover Cap: This is the maximum number of time off hours employees can carry over from policy year to policy year.
- Negative Balances: Do you want workers to be allowed to borrow time off they have not yet accrued?
- A common reason to allow negative balance is to allow workers to request future PTO. For example, say your policy accrues per pay period and balances reset on January 1. Some workers may already know they want a week off for the holidays. Negative balance would allow them to request time off in the future even though they have not yet accrued the time in their balance.
- All PTO requests are subject to manager approval, and requests will indicate the existing worker balance corresponding with the request whether positive or negative.
- Minimum Increments: What is the minimum increment in which workers can request time off? If you don't impose a minimum increment, workers will be able to request time off in any amount.
- Waiting Periods: Do workers have to work at the company for a certain amount of time before they are eligible to request time off? If so, does time off acccrue during this waiting period? If yes, check the corresponding box. If no, uncheck the corresponding box.
- New Hire Proration: Should balance accrual for new hires prorate based on their hire date?
- Blackout Dates: These are dates when employees are not permitted to request paid time off. Any worker requests submitted for blackout dates will be automatically rejected by the system.
Step 5: Import
During this step, you'll choose which workers to assign to this policy and import any existing paid time off balances.
Who is covered by this policy? Check the box to the left of each person's name to assign them to the policy. You can filter the list by name, current policy, location, department, employment type, or compensation type by hovering over the header name and selecting your filter method.
How should we handle existing time off balances? If you want your workers to start fresh on the new policy, select Switch to bypass the step of importing existing PTO balances. If you want to import existing balances, select Import Data.
- If you select Import Data, you'll be prompted to select a balances effective date. Many companies choose to import balances on the last day of a pay period so that accruals within Zenefits start on the first day of the next pay period.
For example, if your pay period is March 1-15, import balances as of the 15th. Zenefits will start accruing the following day per the parameters defined in the time off rules.
Import current time off balances. Click the blue Download link in the blurb at the top of the page to download the template for the time off balance import. Each worker selected on the Who is covered by this policy? page will populate onto the spreadsheet.
The first tab of the spreadsheet will include instructions on how to properly format information in order for the upload to work. Review these instructions for tips and tricks on balance import best practices. The second tab will be where you can enter employee balances.
Once you have completed the spreadsheet, drag and drop or browse to add the document into Zenefits. When you click “Save & Continue,” Zenefits will check for any errors and, if none are present, will update employee balances.
Things to note:
- Balances need to be imported in terms of hours, not days.
- Tenure bonuses will not pull into the (Days/Year) accrual column.
Step 6: Notify Employees (or don’t!)
Here you can preview a system-generated email where we will notify all employees that they have been assigned to a new Time Off policy. If you do not want to send any emails to inform employees at this time, click the “Skip and Finish” button to finalize the configuration of your Time Off policy in Zenefits.
Things to note:
- You cannot set up additional Time Off policies until you have completely finalized the configuration of the first policy. Once the first policy has been finalized, additional policies can be added by clicking into Time Off > Settings > + Add Policy. This also where edits can be made to existing policies.
Other Helpful Resources
The information contained in this article pairs with the following Education Services course:
We recommend that you explore this course in addition to referencing these articles, as the course expands upon the information included here. Once you have Time Off setup, go to the course catalog to complete additional Time Off courses