Keeping annual leave balances in units other than weeks may result in failing to comply with the Holidays Act if your employee's work patterns change. That's because what genuinely constitutes a working week for them has probably changed.
A week is defined at the time annual leave is taken and not when it is earned/accrued. If annual leave balances are kept in any unit other than a week, a recalculation of the balance is necessary.
For example, an employee who starts at 20 hours per week would be set up in the payroll system to receive four weeks of 20 hours (80 hours) on their 12-month anniversary. Midway through the following year, their hours increase to 40 hours per week. In order to remain compliant, their annual leave balance will need to be recalculated so that they retain the same entitlement in weeks, i.e. four weeks of 40 hours (160 hours).
This is why holding annual leave balances in hours or days need recalculating whenever work patterns change. However, when held in weeks, no recalculation is necessary because the underlying balance in weeks remains constant.
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