Setting up time off in lieu

When employees work extra hours, your organization may choose to compensate them with time off instead of paying them overtime. You can set up Replicon to convert overtime to time off in lieu automatically, or to allow users to choose which hours to convert.

You must be using Configurable timesheets, pay rules, and new time off to set up time off in lieu. If you're not using these, you may still be able to let users bank overtime hours. Refer to Setting up overtime banking for more information.

How time off in lieu works

Which hours are available for conversion to time off depends on two things: each user’s assigned pay rule and the settings you enable in your company’s time off in lieu policy.

For example:

  • A user has a pay rule that says any hours they work beyond 40 in a week are paid out at 1.5x
  • You specify in your time off in lieu policy that users can convert all hours that fall within the 1.5x pay code to time off, using a 1.5x multiplier
  • If that user is assigned the time off in lieu component in their timesheet template and they enter 42 hours in their timesheet, they can convert 2 overtime hours to 3 hours of time off

Automatic vs manual conversion

When setting up time off in lieu, you can choose whether the calculation is automatic or whether the employee can specify how many hours are converted.

If the calculation is automatic, all hours for the selected pay code are converted at the multiplier you specify. The user’s timesheet will show the calculation.

If the calculation is manual, the employee can choose how many overtime hours are converted to time off. The user makes these selections on their timesheet. Any hours that are not converted will be paid out.

If you wish, the user can also choose how many time off hours are granted in exchange for the overtime, and the time off type they are deposited to.

Setting up time off in lieu

To set up time off in lieu:

Set up system level options

  1. Ensure Time Off in Lieu Policy options are enabled in your administrative permissions.
  2. Set up and assign pay rules so overtime is calculated on timesheets.
  3. Confirm that you’ve created all the time off types your organization will use.

You don’t need to create a special time off type for saving time off in lieu – any time off type can be used. However, you might want to use the Banked Time type if you don't want balance limits and resets configured for other time off types to apply to time off in lieu.

    Set your time off in lieu policy

    1. Go to Administration > Time Off > Time Off In Lieu.

    If you just enabled Time Off in Lieu permissions, you may need to log in to the system again before this option will display.

    1. Choose which pay codes can be converted to time off in lieu. For each pay code:
    • Specify whether all of the hours for the pay code should be converted to time off, or if the user can choose how many hours are converted.

    • Enter the multiplier, which specifies how many hours of time off are granted for each overtime hour.

    In some jurisdictions, employees must, by law, be granted time off equivalent to their overtime rate. For example, a user who earns 1.5x for 2 hours of overtime must be granted 3 hours of time off in lieu of that overtime.

    1. Choose which time off types a user can deposit the time off in lieu to.

    If you select multiple time off types:

    • And users can select which hours to convert, they can choose from among the types you select
    • And conversion is automatic, the time off will be deposited into the first time off type you add here

    Users will only be able to deposit to the selected time off type if it is assigned to them in their user profile.

    1. Click Save.

    The Time Off in Lieu Deposits option in the time off in lieu policy lets you change the time of deposit from after approval (the default), to as soon as the applicable overtime is entered in the timesheet. This option is useful for select customers who offer compensatory time off that expires quickly, to ensure employees have time to use the rest time they’ve earned. We do not recommend changing this setting under typical usage, as it risks employees taking time off based on invalid overtime.

    Assign time off in lieu to users

    1. Add the Time Off in Lieu component in the user’s timesheet template.

    On any new timesheets, the user’s overtime will now be converted to time off based on your policy settings.

    FAQs

    What happens if none of the selected time off types are assigned to the user?

    If none of the eligible time off types are enabled for the user, an error will be shown on the user’s timesheet. The user will be paid out for the hours instead.

    Can we create multiple time off in lieu policies?

    No, only one policy can be created. If you don’t want to give time off in lieu to certain users, don’t include the Time Off in Lieu component in their timesheet template. Their overtime will be calculated as overtime pay.