Average Holiday Pay Top Up
Average Holiday Pay Top Up allows Cezanne to continuously calculate the additional holiday pay an employee may be entitled to based on their pay and holiday activity.
Unlike the existing 52 Week Average Holiday Pay process, which calculates holiday pay as part of the payroll process, Average Holiday Pay Top Up is designed to keep the calculation up to date as relevant payroll and absence information changes.
How Average Holiday Pay Top Up works
The system continuously recalculates the employee's holiday pay position as relevant information changes. This means that the calculation is kept up to date without requiring a payroll run to be processed first.
Changes that may trigger a recalculation include:
- Changes to hours worked
- Overtime or other pay inputs
- Bonuses and other payments
- Changes to tax or pension information
- Absence updates
- Other changes that affect the employee's pay or holiday pay calculation
The system uses these changes to update the employee's payroll position and calculate any applicable Average Holiday Pay Top Up.
Real-time payroll calculation
Average Holiday Pay Top Up uses the real-time payroll calculation engine to keep payroll information continuously up to date.
Rather than waiting for a payroll run to calculate all values, the system recalculates the relevant values when changes are made. This provides an up-to-date view of the employee's payroll position.
For example, when an additional payment such as overtime is added, the system can recalculate the relevant tax, National Insurance and net pay values without requiring the entire payroll to be processed again.
Continuous calculation
The system maintains an up-to-date payroll position for the employee, including relevant period and year-to-date values.
This allows users to see the current payroll position and any applicable Average Holiday Pay Top Up without needing to run payroll first.
The calculation continues to take account of the relevant payroll rules, including:
- PAYE cumulative calculations
- National Insurance thresholds and pay frequency rules
- Statutory payment calculation requirements
- Relevant Average Weekly Earnings calculation periods
- Qualifying periods and other statutory requirements
Real-time calculation does not simplify or bypass these rules. Instead, the relevant values are recalculated as the underlying payroll information changes.
Live payslip information
The employee's payslip information is kept up to date as payroll inputs change.
This allows users to see the employee's current expected pay position before the payroll is finalised.
Any changes that affect the employee's pay can therefore be reflected in the current payroll calculation without waiting for a separate payroll run.
Validation and exceptions
The system continuously checks for issues that could affect the payroll calculation.
Depending on the information entered, this may include issues such as:
- National Minimum Wage breaches
- Negative net pay
- Pension threshold issues
- Incorrect National Insurance categories
- Other payroll validation issues
Where an issue is identified, it can be surfaced as part of the payroll calculation process so that it can be investigated and corrected before payroll is finalised.
Payroll finalisation
Because the payroll information is continuously calculated, finalising payroll is primarily a confirmation step.
The payroll is already calculated based on the information currently held in the system. Finalisation confirms the payroll position for the relevant period.
Any changes made before finalisation are reflected in the relevant payroll calculations and Average Holiday Pay Top Up values.
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