Vacation Encashments

Vacation Encashments 

This feature introduces enhancements that streamline the vacation encashment process within the ZenHR platform, giving HR teams greater visibility, flexibility, and control. 

Administrators can now encash employee vacation balances without requiring termination, allowing employees to cash out unused vacation days, whether they cannot use them or the company chooses not to carry them forward.

TABLE OF CONTENTS

• How to Use This Feature
• Manage Encashments
• My Encashments
• Approval Cycle
  
  

How to Use This Feature

User Menu → System Preferences → Time Setup → Leaves & Vacations → Annual Vacations

On the Annual Vacations page, in the table beside the desired annual vacation, click on the edit icon.

Here you can edit the annual vacations and enable the Vacation Encashment feature.

Admins can activate the vacation encashment feature for each annual vacation, view and set which annual vacation balance they would like to allow for encashment, and enable employees to request encashments. If the employees request these encashments, they can also choose the default payment type. (Admins can set the payment type manually.) 

When you activate the “Ability to request encashment” toggle, the Default payroll status for requests option in payroll, Off-cycle, will apply to the transactions requested from the employee side. 

Manage Encashments

Main Menu → Payroll → Manage Encashments → STB Encashments

The admins with the roles Super admin, Financial officer, and employees with permissions can access the Manage Encashments page. 

To Add an Encashment:

1. On the Manage Encashments page, click "Add Encashment".

2. A side panel will open.

3. Select the Employee

   • The system will automatically populate the Annual Vacation types that match the employee's request.
     
     

4. Select an Effective Date

   • The system will now display the end-of-year and effective date balance. 

5. Choose the Payroll Status (In-Payroll or Off-Cycle)

Once an encashment is added, it will automatically create a financial transaction. The financial transaction will be (income, taxed), and the status will be based on the payroll status chosen for the encashment; it can’t be edited or deleted in the financial transaction pages. 

Through this page, admins can also create mass vacation compensations by clicking on the mass encashment option. There are two different options the admins can choose from:

1. Encash Carry/Available Difference: This will mass encash the balance carried from the previous year.

2. Encash Days with a Maximum Amount: This option allows employees to encash their balance for a specified maximum number of days.

Vacation Encashment Calculation
Vacation encashments are calculated based on the following:     

1. Employee salary package.

2. Vacation Compensation is based on the payroll setup.

3. Vacation Compensation based on the vacation type:

   1. Compensation percentage

   2. Allowances added

My Encashments

Main Menu → Payroll→ My Encashments → Vacation Encashmentsgm

To Submit a Request, the Employee Must:

• Choose Vacation

• Enter the Effective Date

• The Amount field will be locked until a date is selected.

• Once a date is picked:
  
  

  • The system checks the employee’s vacation date as of that effective date.

  • It shows:

    • End of the year and 

    • Effective date balance. 
      
      

• Fill in any Notes and Attachments (only if marked mandatory in setup) 

Approval Cycle

When the feature is activated:

• A default approval cycle is added automatically.

• The approver is the Direct Manager.

• The default name of the approval cycle is:
   “Vacation Encashment Requests”.