Time-Off Accrual Frequency Descriptions and Examples

Detailing the different types of time-off accrual frequencies, how they are calculated, and examples of each.

OVERVIEW

When you are configuring and assigning your organization's time-off plans, you need to set the accrual frequency for each plan. There are six types of accrual frequencies:

  • Annual

  • Annual Lump Sum

  • Monthly

  • Semi-Monthly

  • Weekly

  • Daily

CALCULATING ACCRUAL AMOUNTS

Namely divides the total amount of time off allowed under a plan by the annual number of accrual dates. For example:

  • Annual and Annual Lump Sum: The total amount is granted once per year.

  • Monthly:Total time-off amount / 12

  • Semi-Monthly:Total time-off amount / 24

  • Weekly:Total time-off amount / 52

  • Daily:Total time-off amount / 365 (366 on leap years)

WHEN DOES TIME OFF ACCRUE?

Time off accrues at 01:00 UTC on the accrual date. 01:00 UTC is 9pm ET / 6pm PT the previous day during Daylight Savings Time (March-November), or 8pm ET / 5pm PT the previous day once Daylight Savings Time ends.

FREQUENCY DESCRIPTIONS AND EXAMPLES

Annual

Annual frequencies accrue the full time-off amount on the renewal date of the plan. If the renewal date is the employee anniversary date, each employee will accrue the full amount on their start date and then again on their anniversary every subsequent year.

If the renewal date is a specific calendar date (for example, January 1), employees will accrue the full-time off amount every year on this date. New employees will not accrue any time off until the renewal date unless the plan is set to be prorated, in which case they will receive the prorated amount on their start date and the full amount every subsequent year on the renewal date.

Examples:

  • Annual

    • 12 days of time off

    • Plan renews on January 1

    • Employee starts on July 1

    • Employee accrues no time off until January 1, at which point they accrue 12 days

  • Annual with proration

    • 12 days of time off

    • Plan renews on January 1

    • Employee starts on July 1

    • Employee accrues six days of time off on their start date (prorated out of the 12 total), then accrues 12 days on

      January 1 of the following year

Annual Lump Sum

Annual Lump Sum plans accrue the full time-off amount on the renewal date of the plan, regardless of an employee's start date. If the renewal date is the employee anniversary date, each employee will accrue the full amount on their start date and then again on their anniversary every subsequent year.

If the renewal date is a specific calendar date (for example, January 1), the employee will accrue the full time-off amount on their start date, and then again on the plan's renewal date every subsequent year.

Example:

  • Annual Lump Sum

    • 12 days of time off

    • Plan renews on January 1

    • Employee starts on July 1

    • Employee accrues 12 days on their start date (lump sum), then accrues 12 days on January 1 of the following year

Monthly

Monthly plans accrue once a month on the same date as the plan's renewal date. If the renewal date is the employee's anniversary (for example, January 17), time off will accrue every month on the same date as their start date (February 17, March 17, April 17, etc.). If the renewal date is a specific calendar date (for example, January 1), time off will accrue every month on the same date as that calendar date (February 1, March 1, April 1, etc.).

Example:

  • Monthly

    • 12 days of time off

    • Plan renews on January 1

    • Employee starts on July 1

    • Employee accrues one day on their start date, then accrues one day on the first of each subsequent month. On January 1 of the following year, the plan resets to zero and the one day per month accrual begins again.

Semi-Monthly

Semi-monthly plans accrue on the first and 16th of every month.

Example:

  • Semi-Monthly

    • 12 days of time off

    • Plan renews on January 1

    • Employee starts on July 1

    • Employee accrues 0.5 days on their start date, then accrues 0.5 days on the 16th and first of each subsequent month. On January 1 of the following year, the plan resets to zero and the 0.5 days twice a month accrual begins again.

Weekly

Weekly plans accrue every Friday.

Example:

  • Weekly

    • 12 days of time off

    • Plan renews on January 1

    • Employee starts on July 1

    • Employee accrues 0.231 days on their first Friday, and every subsequent Friday. On January 1 of the following year, the plan resets to zero and the 0.231 days once a week accrual begins again.

Daily

Daily plans accrue time-off every day.

Example:

  • Daily

    • 12 days of time off

    • Employee starts on July 1st

    • Plan renews on January 1st

    • Employee accrues 0.033 days on their first day, and every subsequent day. On January 1 of the following year, the plan resets to zero and the 0.033 days per day accrual begins again.