Holidays Act: Improved Accuracy of Relevant Daily Pay
As defined in the Holidays Act, when an employee is paid for any of the following leave types (BAPSF), an employer “must pay the equivalent of the employee’s relevant daily pay or average daily pay, for each day.” This covers:
• Bereavement Leave
• Alternate Days
• Public Holidays
• Sick Leave
• Family Violence Leave
By its very definition in Section 9 of the Holidays Act, no payroll software can accurately ‘generate’ RDP for all employees all the time. Often accuracy requires knowledge and input of work-related payments which at times can only be known by the employee and/or manager.
If they are not entered, the payroll system RDP falls below compliance. In consultation with AMS customers we identified it would be ideal if a comparison could be made between Relevant Daily Pay (RDP) and Average Daily Pay (ADP).
As a result, you can now choose to automatically generate a top-up allowance where the total value of RDP payment items on the day falls below the system calculated ADP. This considerably improves Holidays Act compliance and ensures you are demonstrating best practice in managing BAPSF leave.
Holidays Act: Enduring Allowance Compliance
Enduring allowances are those allowances paid at a set rate every pay - regardless of the amount of time worked by the employee. These allowances should (by definition) be included in various Holidays Act leave rates - making compliance a nightmare when two rates must be compared, to pay the higher.
Traditionally there have been three treatment options available for these allowances:
1. Include the allowances in the various leave rates, which inevitably leads to the employee being overpaid as the full allowance is paid every pay AND the value of the allowance is incorporated within the leave payment.
2. Include the allowances in the various rate calculation methods with a manual change to the allowance rate when leave is taken
3. Exclude the allowances from the various leave rates, which can also lead to non-compliance unless a manual process is incorporated to cover when:
o an employee’s allowance is stopped
o an employee’s allowance is reduced
o employment ends and leave is paid out
Now there is a fourth option.
AMS allows you to automatically pro-rate enduring allowances when an employee is on leave. It means you aren’t left with messy, difficult manual calculations and you can pay enduring allowances and leave with confidence.
Managing Multiple Superannuation Schemes
This functionality has been largely developed to address an issue currently being faced by our DHB customers. Many allow their employees to contribute to more than one superannuation fund while their contracts refer to a maximum employer contribution based on a percentage of base salary.
KiwiSaver contributions are a percentage of gross earnings, which means contRibuting to more than one fund can result in a higher than base employer contribution. Consequently, customers want to be able to cap the employer contribution across multiple schemes
This new functionality delivers the requirement and also ensures the legislated employer contribution commitment is met.
Managing Employee Share Schemes
Out of consultation with our private sector clients, the rise in Employee Share Schemes (ESS) has resulted in organisations wanting to include details about ESS benefits as part of their monthly IRD filing process.
As a result, employers are now able to use AMS to record ESS benefit amounts, using different allowances, depending on whether the benefit is to be included in PAYE calculations or not.
The IRD file generation process automatically recognises when ESS benefits have been recorded and populates the relevant fields as defined by IR.
Remediation and Rectification
Rectification and Remediation has for some time been a significant focus for those of us delivering payroll in the Health Sector. While much of the Rectification work has been initiated and is ongoing, delivery against remediation is still evolving. AMS have invested significantly in partnering with our customers on the journey and creating a seamless delivery framework for remediation. The focus has been on compliance, cost-savings and efficiency to ensure all our customers have the best remediation experience possible.
Keeping Pace with Browser Changes
Nothing is more certain in the online world – than change. There has recently been a configuration change to set an explicit “same site” policy on authentication cookies. This is now required for Chrome and will shortly be introduced for Firefox and Edge browsers. AMS has updated its login / logout process to ensure everything continues to operate as you expect – irrespective of the browser or domain you are using.
More Backend Updates
This can get very technical, very fast but a significant part of this release has been delivering against our commitment to continuously improve across our platform and solutions.
This release has focused on optimising our data processing and automated testing capability so we can do more on the platform at a faster speed. One of the challenges is, like an iceberg, very little of these technical changes are visible. However, it does mean developments, updates and implementations will all be more efficiently and effectively delivered – which is a huge win for us all.
This is very much a high-level summary of the release. AMS customers can get detailed release notes through your account manager or email support for further information. If you’re not a customer (as yet) and would like to know more, please get in touch - we are always happy to share what we do.