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Ontario Personal Emergency Leave (PEL)

Ontario Personal Emergency Leave (PEL) requires that employers provide up to 10 days per calendar year of sick leave for employees who need a sick day, or have an injury or medical emergency, or other family emergency. Although a maximum of 10 sick days can be used, only the first two are required to be paid.

Creating a sick leave benefit for PEL will require two components:

  1. A Benefit Code where the sick day entitlement will be accrued for each year.

  2. An Earning Code that will reduce the entitlement and pay for only the first two sick days taken in the year.

1. Create a Benefit Code for PEL entitlement

The benefit code for the PEL entitlement will keep track of how many sick days an employee is entitled to take in the current year, and reset the entitlement at the start of each calendar year.

Let’s go through the steps to create the Benefit Code for the PEL entitlement:

  1. Open Canadian Payroll > Employer Payroll Tables > Deduction/Benefit Codes

  2. Create a new Benefit Code for the PEL entitlement.

The Deduction Data settings and an Entitlement Formula will be added to the Benefit Code in the following sections.

1.1. Deduction Data tab

The settings for the Deduction Data tab should be setup as follows:

TypeAccrued Sick Leave
Leave EntitlementEnabled
Accumulate InDays

Using these settings on the Deduction Data tab the benefit code will be used as a sick leave entitlement for the employee that will accrue entitlement in days.

8 10 2018 10 41 58 AM
1Accrued Sick Leave is selected for the Type to use the Benefit Code as a bank for accrued PEL entitlement.
2The Leave Entitlement option is enabled to indicate this Benefit Code is an entitlement.
3The entitlement is set to accumulate in days. This will change the units that the entitlement is accrued and taken in.

1.2. PEL Entitlement Formula

By using a formula in the Benefit Code to generate the accrued entitlement the number of accrued days can be limited to 10 per year, and the province of employment can be checked so that only employees who are employed in Ontario will have the entitlement.

Important:
The formula for the entitlement will need to be customized by changing the example code (XXX) to match the real code for the PEL Entitlement.
Formula

@if(V30=6, @if(L6#XXX=0, 10 , 0 ), 0 )

Variables
V30Employee province of employment.
6Ontario
L6#XXXLeave accrued units for code XXX.
Say that again?

The formula can be read as: “If the employee province of employment is Ontario, and there is no accrued leave, then generate 10 days of accrued leave.”

1.3. Formula tab

8 10 2018 10 54 41 AM
1The formula is entered in the Leave Units L0 field.
2The code for the entitlement Benefit Code is updated in the formula.
3The formula can be tested with dummy values using this button.
Tip: Test the formula!

Press Test on the Formula tab to see a summary of the variables used, and test out the formula before using the Deduction Code for payroll.

1.4. Save the PEL entitlement Benefit Code

The benefit code setup is now finished and the code can be saved by pressing OK at the bottom of the Benefit/Deduction Code window.

The next component for the PEL is to create an earning code to record when employees actually have taken a sick day, and pay them accordingly. This will be covered in the following sections.

2. Create an Earning Code for PEL taken

An Earning Code for recording the PEL taken by employees will be created now. This Earning Code will be responsible for reducing the entitlement days each time that a PEL is taken, as well as ensuring that the first 2 days of taken are paid.

  1. Open Canadian Payroll > Employer Payroll Tables > Earning Codes.

  2. Create a new Earning Code for PEL taken.

2.1. Earning Data tab

The settings for the Earning Data tab should be setup as below. These settings will make the Earning Code reduce the leave entitlement automatically whenever PEL taken.

% of Basic100.00
Accumulate Work Units InHours
Earning TypeTakeLeave
Leave Entit.The Deduction/Benefit Code created previously.
Formula Based EarningEnabled
Reduce SalaryEnabled
Reduce Salary

When you choose the Reduce Salary option you will also need to check another option within the Processing tab of Payroll Parameters (Canadian Payroll > Installation & Maintenance > Payroll Parameters > Options > Processing).

There you will find an option called Reduce Salary by reducing units before calculating amount. Enabling this is important if you want to reduce a salary when processing a code that does not include dollars. For the Personal Emergency Leave only the first two days will be paid, which means that if this option is not selected the salary will not be reduced when a Personal Emergency Leave is being processed without pay.

Notes:
  • 100% of basic is chosen so that when the first 2 days of PEL are taken, the employee is paid at their normal rate.

  • Leave Taken Earning Type will automatically reduce the leave entitlement of the selected Deduction Benefit Code by the units entered on this code.

  • Formula Based Earnings are enabled because a formula is used to control when the taken leave should be paid.

  • Reduce Salary is enabled to correctly pay salary employees. Without this option enabled salaried employee would receive double pay for any PEL days taken.

8 10 2018 11 02 08 AM
1Hours is selected for work units to accumulate in.
2Earning type TakeLeave is selected.
3The PEL entitlement Benefit Code is selected for the Leave Entitlement.
4Formula Based Earnings are enabled so that a formula can be entered in the Formulas tab.
5Reduce Salary is enabled to correctly pay salaried employees who take PEL.

2.2. PEL Taken Formula

Important:
The formula for the entitlement will need to be customized by changing the example codes (XXX and YYY) to match the real code for the PEL entitlement Benefit Code (XXX) and the PEL taken Earning Code (YYY).
Formula
Work Units U0=W1
Earnings E0=@if(V30=6,@if(L8#XXXL0#YYY < 9, 0, W1*C1), 0)
Variables & Values
V30Employee province of employment.
6Ontario
L8#XXXLeave remaining units for code XXX.
L0#YYYCurrent period leave units for code YYY.
W1time data entered units – hourly.
C1time data entered rate of pay - hourly.
Why L7 (Leave Taken Units) is not used:
  • The L7 variable is not used because its value is only updated once after each pay-run. L0 on the other hand is updated during each step during pay run processing. This difference means that if multiple PEL days are taken in the same period, L0 will account for each one and only pay for the first 2.

  • L8 – L0 gives the days of leave remaining currently, and if it is less than 9 we know that more than 2 days of leave have been taken in total and don’t pay for the remaining leave taken.

Say that again?

The formula can be read as: “If the employee is working in Ontario and 2 days or less of leave have been taken, pay the hours entered.”

This formula will limit the payments to only the first two days of leave. Starting on the third Personal Emergency Leave there will be no payments only time.

2.3. Code Formula tab

8 10 2018 11 10 35 AM
1Work Units are updated for each day of PEL taken.
2Earnings are only updated based on the result of the formula.
3The code for the PEL entitlement Benefit Code is updated in the formula.
4The code for the PEL taken Earning Code is updated in the formula.

2.4. Save the PEL taken Earning Code

The Earning Code setup is now finished and the code can be saved by pressing OK at the bottom of the Earning Code window.

3. Program Options

In order for this new process to calculate the leave entitlement units accurately you will have to add the following options to the Program Options.

Add new Program Options

Press Insert on the Program Options screen to add new Program Options.

  1. Open System Administration > System Parameters > Program Options.

  2. Add the MinLeaveTakenCodes option:

    Option IdPy.PayCal.MinLeaveTakenCodes
    DescriptionList of earning code where a minimum leave taken units will apply.
    ValueYYY
    Replace YYY with the code of the PEL taken Earning Code
  3. Add the MinLeaveTakenUnits option:

    Option IdPy.PayCal. MinLeaveTakenUnits
    DescriptionList of Minimum leave taken units matching to Py.PayCal.MinLeaveTakenCodes.
    Value1.0
    Any amount of hours lower than the total hours per day will be considered 1 day for the emergency leave code.

3.1. Max Leave Taken Options

The final option that will need to be added is for the maximum units of leave that will reduce the entitlement. The maximum units can be calculated using two different options:

  • The first option is to choose a maximum for each entry.

  • The second option is to choose a maximum for each day.

Note:
Both program options (per day/per entry) cannot be used at the same time.
  1. Add either MaxLeaveTakenUnitsPerEntry or MaxLeaveTakenUnitsPerDay option.

3.1.1. Per entry option

The per entry option takes a maximum of 1 day even if the total hours of leave for that day is over the regular hours per day for that pay group.

For example if an employee gets paid 10 hours of Personal Emergency Leave in a pay group where the per day hour is 8, this program option will make sure to deduct 1 day of Personal Emergency Leave not 1.25.

Option IdPy.PayCal.MaxLeaveTakenUnitsPerEntry
DescriptionList of the Maximum leave taken units for each ENTRY matching to Py.PayCal.MinLeaveTakenCodes.
Value1.0

3.1.2. Per day option

The per day option is for employees with split shifts. This option will calculate 1 unit of Personal Emergency Leave taken even if there is more than one entry within the same day.

For example if an employee works two shift of 4 hours in the same day and requires two 4 hours entry of Personal Emergency Leave, this option will let the system know to only deduct 1 day of PEL.

Option IdPy.PayCal.MaxLeaveTakenUnitsPerDay
DescriptionList of the Maximum leave taken units for each DAY matching to Py.PayCal.MinLeaveTakenCodes.
Value1.0

4. Add the Earning and Deduction/Benefit Codes to the employee(s)

The formula’s included under the earning and the deduction/benefit codes will only return a value if the employee has a province of employment set to Ontario. Which means that these two codes could be added to a pay group by using the “Employment Defaults” option.

Note:
  • We advise you to try it in a test environment first and make sure that it returns the value you are expecting. Furthermore if your Avanti system has not been updated to the latest version this set up might not work.

  • In order for the PEL accrual to be added in the YTD of selected employees, the codes will have to be activated on these employees and processed through payroll.

If you have any questions or experience any difficulties please reach out to Client Care at 1.800.660.0464 or by email at Care@Avanti.ca. Thank you.

J
Jack is the author of this solution article.

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