Paid Time Off Based on Hours Worked

The article provides guidance on creating a time off policy based on hours worked for hourly employees in BambooHR. It outlines the steps needed to ensure accurate accruals and includes a table of contents for easy navigation. Users are advised to first create a general time off policy before focusing on hour-specific policies. The article details how to set up the accrual schedule and emphasizes the importance of selecting the correct time off category. It explains how BambooHR determines hours worked via an hours importer and outlines the accrual frequency. Additionally, it addresses scenarios where approved hours may change and the implications for accrual calculations. Lastly, it discusses how BambooHR Time & Attendance integrates with accruals, ensuring accurate tracking of hours worked.

  • Jul 2, 2026
  • Knowledge

Title
Paid Time Off Based on Hours Worked
Article Text
The feature Paid Time Off Based on Hours Worked is available in Core, Pro, and Elite packages. The Add-on option is greyed out, indicating it is not included.

How do I create a time off policy based on hours worked?

Purpose: To show you how to create a time off policy based on hours worked for your hourly employees to ensure accurate accruals. 

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Table of Contents

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If you have not created a time off policy in BambooHR, please refer to our help article to learn how to create a time off policy before viewing this guide. That guide will help you understand the entire process of creating a policy before diving into creating a policy for hours worked.

Add a time off policy

Screenshot of the New Policy setup in BambooHR. The Accrual Schedule section is open. Fields displayed:Employees accrue set to “6.77 hours per hour worked.”Accrual Frequency set to “Weekly, on Monday.”Tabs at the top indicate the process steps: Basic Info, Accrual Setup, and Summary. This highlights how to configure accruals based on hours worked.

After adding the name and category of your policy, click Next Step to set up the Accrual Schedule.

When setting up the accrual schedule of your policy, select Per hour worked in the Accrual Schedule section.

Please note you must create a policy based on hours worked within a time off category that accrues by hours and not days. If you are having trouble selecting the time off category to add to the policy, please be sure the category accrues in hours.

How does BambooHR determine how many hours my employee has worked?

Use the hours importer to import the number of hours each employee has worked. You can find more information about how to import hours worked in this guide.

Screenshot of the Accrual Schedule step when setting up a new time off policy.Field: Employees accrue 6.77 hours per hour worked.Frequency dropdown: Weekly on Monday.Orange callout box with text: “Once ‘Per hour worked’ is selected, you will see an option to select the Accrual Frequency.”Additional Accrual Options listed, such as when accruals begin and carryover rules. Buttons along the bottom: Next Step, Previous Step, Cancel.

Once you have determined the amount an employee will accrue per hour worked, you will still need to decide the accrual frequency. This frequency refers to how often you will give the employee the amount they have accrued within a time frame. This usually aligns with the employee's pay period.

In the example above, an employee will accrue 0.02 hours of time off per hour worked. The total amount of accrual for the previous month will be given to the employee weekly on Mondays. Therefore, if the employee has worked for 40 hours during the week, they will receive an accrual of 0.8 hours.

What happens if the approved amount of hours worked changes?

The accrual will rerun from that point forward. And, just like with other policies, if we notice any edits made to the policy after the edit of approved hours, we will not automatically rerun the accruals for the employee. If this happens, please contact our support team for help in making any accrual changes.

What if I am using BambooHR Time & Attendance?

Hours entered through BambooHR Time & Attendance will automatically link to accruals in a "per hour worked" policy. Accrual calculations will occur based on the Time Off policy settings under Employees accrue. Only approved hours worked within the timeframe between the last accrual date and the next accrual date (specified in the policy settings) will be calculated. If an approver has not approved the hours by the next approval date, they will not be calculated and the accrual will show as zero. 

For example, if the accrual deposits monthly on the 1st and today is January 25th, then the approver will need to approve all hours worked within the month of January before February 1st in order for them to be calculated. If the approver does not approve until February 3rd for the month of January, then those hours will show as zero since the next accrual period already began on February 1st. 

Please note if your employees work on holidays and receive a special rate or regular pay, then the employee will receive time off accruals for every hour worked on the holiday. Any time awarded to the employee for a holiday will be counted as hours worked when the policy accrues.

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