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Vacation in Canada comes in two parts: vacation pay and vacation time.
- Vacation pay is the money employees earn for vacation.
- Vacation time is the hours or days employees are allowed to take off.
Jane Payroll can help you manage both using time off policies.
You’ll set up time off policies as part of onboarding to Jane Payroll. After you complete the onboarding checklist, and before you run your first payroll, you’ll see a Time Off section under Billing > Payroll > Account. This is where you’ll create the policy that fits how your clinic manages vacation.
There are a few different ways to manage vacation in Jane, depending on what matters most to your clinic. The sections below will help you choose the option that works best and show you how to set it up correctly.
Choose how your clinic manages vacation
Start by thinking about what you care about most.
- If the vacation pay money balance is most important to you and you want Jane to pay it out automatically every pay cheque, Option 1 is the best fit.
- If you want to track both the vacation pay money balance and the vacation time (hours) balance, and only pay staff when they take time off, Option 2 is the right choice.
- If you mainly care about tracking time off, because your clinic offers more vacation than the minimum requirements and you want those balances to show on pay stubs and be paid when time is taken, Option 3 will work best.
Use the links below to jump to the option that matches how your clinic operates:
- Option 1: Pay vacation pay every pay cheque
- Option 2: Accrue vacation pay and pay it out when time is taken
- Option 3: Track paid time off only
Option 1: Pay vacation pay every paycheck
(Create a Vacation Pay time off policy — recommended for most clinics)
Choose this option if the vacation pay money balance is the most important thing to you, and you want Jane to pay out the vacation pay staff have earned on every paycheck.
This is a great fit if your clinic pays vacation pay as it’s earned. With this set up, you do not need to worry about managing vacation pay balances or recording time off to trigger payment.
How to set this up
Go to Billing > Payroll > Account > Time Off and create a Vacation Pay time off policy.
When creating the policy:
- Choose Pay out on every pay cheque
- Enter your vacation pay rate
- Set Vacation time (hours) to Manual
How this works day to day
With this setup:
- Jane pays out vacation pay as it is earned every payroll run based on the rate you entered
- You do not need to record vacation time during payroll for vacation pay purposes
- The vacation pay hours balance does not affect payroll calculations
If this is how your clinic already operates, this option keeps payroll simple and predictable.
Option 2: Accrue vacation pay and pay it out when time is taken
(Create a Vacation Pay time off policy)
Choose this option if you want Jane to track a vacation pay money balance over time and only pay it out when an employee actually takes vacation.
This option connects vacation pay dollars and vacation pay hours.
How to set this up
Go to Billing > Payroll > Account > Time Off and create a Vacation Pay time off policy.
When creating the policy:
- Select Accrue and carry a balance
- Enter your vacation pay rate
- Choose how Vacation time (hours) should be handled, such as:
- A fixed amount each year (calendar year or hire anniversary), or
- Manual tracking
How this works day to day
With this setup:
- Jane accrues vacation pay dollars as payroll runs
- Vacation time hours act as the trigger for payment
- When you record vacation time during payroll, Jane:
- Reduces the vacation hours balance
- Reduces the vacation pay dollar balance
- Pays the employee for the vacation taken
This option works well if you want Jane to manage the relationship between time taken and money paid.
Option 3: Track paid time off only
(Create a Paid Time Off policy)
Choose this option if you mainly care about tracking time off, not vacation pay money balances.
This is common for clinics that:
- Offer more vacation time than the minimum requirements
- Allow staff to take time off before they’ve been with the clinic for a full year
- Want staff to see a clear time off balance on their pay stubs
How to set this up
Instead of creating a Vacation Pay policy, go to Billing > Payroll > Account > Time Off and create a Paid Time Off (PTO) policy.
When creating the PTO policy, choose how hours should accrue, for example:
- Accruing hours every pay period
- Accruing based on hours worked
- Manual tracking
- Unlimited
How this works day to day
With this setup:
- Jane tracks time off hours only
- When you run payroll and record paid time off:
- Jane asks how many hours were taken in that pay period
- Jane shows the employee’s pay rate for those hours
- You can adjust the rate if needed before submitting payroll
This option works well if your clinic focuses on tracking and paying time off, without managing vacation pay as a separate balance.
Assigning your time off policy to staff
After you’ve created a time off policy that fits your clinic, you’ll need to assign it to each staff member who should use it.
To assign a policy: 1. Go to the staff member’s profile 2. Select Payroll 3. Open Time Off 4. Click Add Time Off and choose the policy you created
If you’re switching from another payroll system or setting this up mid-year, this is also where you can enter any existing balances, such as:
- A starting vacation pay balance (if applicable)
- A starting vacation time balance, if you’re tracking hours
Recording time off during payroll (when needed)
You only need to record time off during payroll if you are using:
- Option 2 (accrue and carry a balance), or
- Option 3 (Paid Time Off only)
If you’re using Option 1, you do not need to record time off for vacation pay purposes.
To record time off during payroll:
- Start running payroll
- Find the staff member in the payroll list
- Click the three vertical dots on the far right of their row
- Select Manage Time Off
- Enter the number of hours taken in that pay period
If you don’t see Manage Time Off, it usually means the staff member hasn’t been assigned a time off policy yet.
Understanding vacation pay balances
Why is my vacation pay balance negative?
A negative vacation pay balance is not necessarily a problem.
This usually means your clinic provides more paid time off than what a percentage-based vacation pay rate would normally cover. In other words, the employee has already been paid more vacation than what has accrued.
You can think of the balance this way:
- A positive balance means vacation pay is still owed to the employee
- A negative balance means the employee has already been paid more vacation than what has accrued
This is common for clinics with generous vacation policies and does not indicate an error.
FAQ
Do I need to track vacation time in Jane?
No. Tracking vacation time in Jane is optional. If you don’t want to track hours, Option 1 is usually the best fit.
Your clinic is still responsible for ensuring staff receive the vacation time they’re entitled to, even if you track it outside of Jane.
Can I adjust vacation time manually?
Yes. You can edit a staff member’s time off balance at any time from
Staff Profile > Payroll > Time Off.
Are Timesheets connected to Time Off?
Not at this time. Marking a day as “vacation” in Timesheets does not affect time off or vacation pay balances. Time off must be recorded through payroll.
Will Jane calculate vacation pay automatically?
Yes. Jane calculates vacation pay based on the rate and option you choose and applies it during payroll.
If you’re unsure which option fits your clinic best, reviewing how you currently pay vacation pay and track time off is usually the best place to start. If you need help, our support team is always happy to walk through your setup with you.