Leave without pay - effect on annual leave

Contributing Cover User karenham
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Contributing Cover User
New Zealand
karenham
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Leave without pay - effect on annual leave

We have an employee on extended LWOP (for several months).  I have not been running a pay for him at all but am wondering now if his annual leave is accumulating while he is on leave and if so, how I avoid this happening.  Should I be running a pay each week using the UNPDLV code? 

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MYOB Moderator Steven_M
21,106 Posts
MYOB Moderator
New Zealand
Steven_M
MYOB Moderator

21106Posts

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Re: Leave without pay - effect on annual leave

Hi @karenham

 

In New Zealand annual leave is based on a set amount each entitlement year and it doesn't look at if the employee is working or not.

 

If the employee is taking leave without pay you would generally process a pay for that particular week for using the UNPDLV unpaid leave pay code. If that employee is taking an extended period of leave without pay you could look at either:

  • Extending the employee's anniversary date - more time until they are entitled to additional annual leave

    -OR-

  • Reducing the annual leave rate divisor - get the same amount of hours but are paid less for those hours.

New Zealand Payroll Support Note: Recording unpaid leave in excess of one week does go through each option available to you in more details. I would also recommend looking at New Zealand Payroll Support Note: How unpaid leave affects annual leave


Do let us know how you get on and if you require further assistance.


Kind Regards,
Steven
MYOB Client Support
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