How to Set Up Vacation Pay Settings

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New to Vacation Pay vs Vacation Time?

We've got you! Click the link below to learn about the difference, check out some examples, and discover how Humi can help make it simple.

Vacation Pay vs Vacation Time - What's the Difference?


All Canadian employees are entitled to Vacation Pay and Vacation Time. Although vacation pay and time are related, employers are required to track them independently, and the compliance requirements for each are different. 

In Humi, you can track your employees' vacation pay and accruals in the Payroll module, and your employees' vacation time and accruals in the Time Off module.

What if I provide employees with paid vacation time off?

We know that some businesses will choose to meet their vacation pay and vacation time requirements by administering a single Paid Vacation Time policy that meets or exceeds the legal minimum for both.
If that's your business model, click here to learn how to turn off vacation pay.


How to Setup Vacation Pay Settings

There are two steps to complete when configuring your employees' Vacation Pay Settings.

Step 1 - Add Vacation Pay Percentage to the employee's compensation(s)

For Humi to track your employees' vacation pay and accruals, you must set up their vacation pay percentage when creating their compensation. For a refresher on creating compensations in Humi, check out this step-by-step guide. 


  1. To add the vacation pay percentage, click the + Vacation pay button
  2. Enter the percentage in the field
  3. When you're ready, click Save


Are you meeting your provincial requirements?

We recommend you read our article Vacation Pay Requirements by Province to ensure that the rate you've entered for their vacation pay percentage meets the legislative requirements.


Step 2 - Set the Vacation Payout Method for employees

After setting the vacation pay percentage, the next step is selecting the Vacation Payout Method you require.


Humi offers two options for providing vacation pay to your employees:

  • Option 1: Accrued vacation pay will be banked in Humi and be paid out when this employee takes vacation. 
  • Option 2: Pay out accrued vacation pay with every payroll.

    Understanding paystubs

    If you select Option 2, employees will not be paid for any vacation days they request off. On the employee's paystub, under the Vacation Pay section, the Spent and Accrued amounts will always be equal since they are being paid out each payroll.


Default settings & vacation accruals

By default, all new employees' vacation pay method will automatically be set to “Accrued vacation pay will be banked in Humi and be paid out when this employee takes vacation.”
If this doesn't suit your needs, you can easily change this setting in their employee profile under the Job & Pay tab. Click here to learn how. 

That's all there is to it! You've successfully configured your employee's vacation pay settings. Click on the links below to learn more about vacation pay in Humi.


  Discover more about Vacation Pay

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