Our business offers some employees paid time off, meaning they accrue PTO hours as they work. Of course this means any eligible employee has a balance of hours, and when they want to use PTO on a paycheck for whatever reason, the balance decreases accordingly.
But sometimes we want to pay people for times they didn’t work without counting it against their balance. This can be either for preplanned reasons like holidays/vacation, or emergency reasons like snow days or equipment malfunction.
This free closure pay was easy with our previous payroll provider. I just enabled the Holiday Pay column, typed in the hours, and employees would get those hours “for free”. Because we were just us paying staff at our discretion, there was no accrual rate or maximum to set up, and we could give Holiday pay to employees who were not eligible for regular PTO.
With Square Payroll, this is a big pain in the neck. There are two workarounds, both annoying.
- Use the Additional pay column. This column is in dollars, not hours. That means once I’ve decided how many hours to pay out, I have to multiply it by each employee’s hourly rate before entering it as “Additional Pay”. And since in the end I want employees to know how many hours I’m giving them, I need to add a Memo to each check.
- Use PTO and adjust the balance. This scenario is better because they can see the amount in hours and dollars. But of course if I just use PTO that someone hasn’t requested, it reduces their balance. So I have to go in and increase their PTO balance by the amount of Holiday hours I’m giving them so that their total is the same after the check (or higher if they’ve also accrued hours in the same pay period).
Both options are tedious and neither one really accurately reflects what happened. I paid the employee for hours they probably would have worked, if we hadn’t closed.
Paid holiday hours are not an unusual concept. I bet Square/Block employees have them! You should make them a part of the payroll product you offer!
One final note: I am not talking about a different hourly rate for working on a holiday (as has been requested elsewhere in the forums). I.e. this is not “you get time and a half because you worked on Thanksgiving day.” Instead, I need to address the scenario of “you’ve worked a 6-hour shift almost every Thursday for the last year, but we were closed this Thursday for Thanksgiving so we’re still giving you the 6 hours’ pay.”
