Create an OSP scheme

  1. Click System Setup.

  2. On the Calculations menu click Company sick pay.

  3. To add a new scheme, click + on the toolbar. If there are no schemes, the screen is blank.

  1. In the Scheme name box, enter a name for the scheme. If you have multiple OSP schemes to set up, make sure the names represent who the scheme involves.

  2. On the Type of scheme list, select an option:

    • Fixed sickness year accumulates sick days since the start of the absence year.

    • Rolling sickness period uses a rolling year from the start date of the absence.

    • Fixed year from date joined uses the employee’s join date as the start of a fixed year, and accumulates from that date.

      The most common scheme type is Rolling Sickness Period.

  1. On the Payment rate basis list, choose how IRIS IRIS Payrite will make sick deductions and payments.

  2. On the Salary Reduction Formula list, choose the formula to be used to make and deduct payments.

    You can create a new formula in System Setup. Go to Calculations > Rate Formulae.

  3. Select the options that match your scheme rules:

    • Base OSP on Hours? sets OSP payments to be hourly, rather than daily.

    • Use Absence calendar? uses the Absence Calendar to record OSP. Deselect this to use the SSP Calendar.

    • Always use Monday – Friday for OSP? calculates OSP days on a Monday to Friday basis, ignoring the employee’s Qualifying Days (work) pattern.

    • Allow OSP to be greater than salary? specifies whether OSP payments can be made that exceed the employee’s period salary.

    • Allow reduction to be greater than salary? specified whether OSP deductions can be greater than the period salary.

    • Print the OSP days on payslip (z-fold only)? prints the OSP balance on the payslip, if you're using Z-Fold stationery.

  1. Next, set up the service breaks of the scheme - the levels of entitlement related to the employee’s service.

  2. Select the Occupational Sick Pay Definition tab.

  3. Specify the bands of entitlement. Then, set the service breaks as months ‘From’ and months ‘Up to’.

    (The example shows five bands and service periods of 0-1 year, 1-2 years, 2-3 years, 3-5 years and over five years.)

  4. On the Are sick pay limits in days or weeks? list, choose the setting that corresponds to the entitlements on your scheme.

  5. On the Base OSP on Percentage of pay or on Fixed payments list, choose how the OSP is paid. If you choose Fixed Payments, specify a flat weekly or daily rate instead of the usual percentage.

  6. If you have ‘waiting’ days at the start of a sickness period before sick pay starts, enter the amount in the Waiting days box.

  7. In the Link days to link instances of sickness to a single period of sickness box, specify an amount . If left as zero, IRIS Payrite will assume that there are no linked periods. This setting is used if your scheme also has waiting days.

  8. In the Days back at work before re-calculating service entitlement box, specify the number of days that the employee must return to work for after sickness, before their service band is recalculated.

  9. Next, specify up to four entitlement bands. (Most sick schemes have two - typically full pay and half pay.) Bands not in use should be set to 0.

  1. Select Add SSP to the OSP? to add SSP to the band.

    By default, SSP is offset from OSP payments. Usually, this is not selected for bands paid at 100% as it would result in the employee being paid more than their salary while off sick.

  1. For each service period, specify the days or weeks of entitlement for each of the bands included in your scheme.

  2. Click Save to finish.