You can configure Dayforce to generate occupational sick pay (OSP), that is, an amount that organisations pay out over and above the statutory amount.
The process begins when an employee makes a TAFW request for sick leave in Dayforce that is approved by a manager. At this point, the pay policy of the Workforce Management module is run against the TAFW record to decrement the necessary OSP balances. OSP balances depend on your organisation's pay out scheme. For example, an organisation could implement a payout scheme similar to the following:
- Pay 100% OSP for the first 20 hours of the sick request.
- Pay 80% OSP for the next 20 hours of the sick request.
- Pay 60% OSP for the next 20 hours of the sick request.
- Pay SSP only after that.
When you calculate payroll, the Apply UK Occupational Sick Pay Rule runs and looks for employee balances in order to determine the number of days OSP is to be paid for and at which level (for example, OSP 100, OSP 80, etc.)
Notes:
- Pay policy configuration in the Workforce Management module is essential for waiting days to be applied for OSP.
- Retroactive processing in Dayforce allows for changes within the previous pay periods to be detected and paid in the current pay period. This includes newly added TAFW that hasn't been paid yet.
Before you begin:
- In order for the application to calculate OSP, you need to configure functionality for calculating statutory sick pay (SSP) in the Payroll module. The application calculates SSP based on TAFW requests that employees submit. See Statutory Sick Pay for UK Employees.
- Also, ensure that the Average Daily Hours and Base Rate fields are defined in the Compensation and Hours section in the Employment Status tab of the Employment > Employment Settings screen in People. The calculations for OSP refer to these fields.
| Step | Description |
|---|---|
| 1. Add a balance unit for days | In the Units tab of Pay Set-up > Balances, add a unit for days. |
| 2. Add balances and corresponding pay codes and categories |
In Pay Set-up > Pay Code, create a pay code for each level in the pay out scheme (OSP100, OSP 80, and so on). Ensure that the Is Absence checkbox is selected for each pay code. In the Balances tab of Pay Set-up > Balances, add balances that correspond to each of the pay codes of the pay out scheme. In the Pay Adjustments section, select the corresponding pay code in the drop-down list. Also, add a balance that corresponds to the sick pay code that employees use to request sick leave. |
| 3. Define balance cascading |
In the Cascades section of the Balances tab in Pay Set-up > Balances, you need to define how the highest level balance in the pay out scheme transitions to the others. |
| 4. Add OSP earnings |
In Payroll Set-up > Earnings and Deductions, create an individual earning for each level of OSP. Each earning should point to the associated balance. In the Balances tab of the earning select the corresponding balance from the Payout Balance drop-down list. For example, create the earning OSP100 and associate it with the OSP100 balance. Also, assign the correct amount/rate to each earning. In the General tab for the selected earning, select the Pay Entry Rates checkbox and add a rate value in the Pay Entry Rates section at the bottom of the screen. For example, for the earning OSP100, add a multiplier rate and add an amount of 1.00. For the OSP80 earning, create a rate with a multiplier value of 0.80. |
| 5. Configure the Apply UK Occupational Sick Pay Rule |
Configure this rule in the employee's payroll policy in Payroll Set-up > Payroll Policies. See Payroll Policy Rule Sequence: UK Occupational Sick Pay Rule. General information about payroll policies is available in the topic Payroll Policies. |
| 6. Configure recurrences. | Configure the necessary recurrences in the Recurrences tab of Pay Set-up > Entitlements to define the frequency that the application applies a balance to an entitlement, such as annually. |
| 7. Configure entitlements |
Add entitlements for each OSP balance in the Entitlements tab of Pay Set-up > Entitlement Admin. For each balance, you need to add a level. In all of the entitlements except the one for 0% OSP, enter 0.00 in the Minimum field of the level properties. This is essential in order to enforce a limit. Conversely, leaving the Minimum field cleared indicates unlimited entitlement. Leave the Minimum field in the level properties in the entitlement for 0% OSP cleared. Also, in each entitlement, add an instance of the Award Balance Amount rule. In its properties, enter the number of days for each to award in the Balance amount to award field. Lastly, configure an entitlement for the sick balance. |
| 8. Configure and assign an entitlement policy |
Configure an entitlement policy in the Policies tab of Pay Set-up > Entitlements. In the policy, move the entitlements for OSP levels from the Available to Current list. Assign the entitlement policy in the Entitlement Policy drop-down list of the Policies and Groups section of the Employment > Employment Settings screen of People. |
| 9. Define eligible balances in the employee record | In the Eligible Balances section in the Work > Balances screen of People, mark the employee as eligible for the OSP balances and the sick pay balance. |
| 10. Schedule background job |
Schedule the Award Entitlements To Employees background job in System Admin > Background Jobs to run nightly, or periodically, so that employees have the necessary entitlements awarded to them. In the parameters of this job, you might need to ensure a specific start date is specified if the entitlement is awarded at the start of the year. You also need to select the necessary entitlement policy. |
| 11. Include/exclude holidays from TAFW |
Configure a time off policy to define whether balances are reduced when holidays are selected as part of the TAFW request. Configure this in Time Away From Work > Time Off Policy, where you can use the Treat Holiday as regular day checkbox to define whether holidays count toward time away request. To omit holidays from time away requests, configure a holiday group in Pay Set-up > Holiday Group and set the applicable days as holidays. Once configured, assign these values in the Pay Policy and Holiday Group drop-down list of the Policies and Groups section of the Employment > Employment Settings screen of People. |
| 12. Configure an employee pay policy |
Pay policy config is essential for waiting days to be applied for OSP. When configured, assign the pay policy in the Pay Policy drop-down list of the Policies and Groups section in the Employment > Employment Settings screen of People. |
Balances for New Starts
When employees start part way through the year you need to ensure that the necessary balances are assigned to them.
To achieve this, perform the following configuration in Pay Set-up > Entitlements:
- In the Recurrences tab create a one-time recurrence with the following configuration:
- In the Frequency Type drop-down list, click Once.
- In the Start Date Type drop-down list, click Hire Date.
- In the Entitlements tab, create a copy of each of the OSP entitlements.
- In the Policies tab, create an entitlement policy and assign the copies of the entitlements to it.