What Effects Does the Contract End Date Have on the Employee Profile?

 

This article explains the effects that storing a contract end date has on the employee’s profile in Personio. Use this attribute for fixed-term employment contracts.

If a contract end date has been entered, this does not mean that notice has been given, or that the employment is being terminated. It is the effective date on which the employment relationship has to be either extended or terminated.

If you have entered a contract end date for your employee, a to-do will appear on your home screen, depending on the access rights and reminders that have been set. You now have the following options:

my_task_contract_expiring.png

 

Contract Extension

If you would like to extend the current employment contract with the employee, navigate to the green action button Prolong contract. This takes you to the employee’s profile. In the Personal data section, click on Edit (blue pen) to enter the newly agreed contract end date. Click on Save. As a result, your employee continues to be in Active status.

In the case where a fixed-term employment turns into permanent, you can leave the contract end attribute blank and delete the contract end date that was originally stored.

 

Contract Termination

This option provides for the termination of the employment relationship as per the contract end date that was previously set. Navigate to the red action button Schedule the termination of this employee. This takes you to the window that allows you to terminate the respective employment. Enter the termination date and type. Optionally, you may enter the date on which notice has been given, the last working day, and a reason for the notice.

After the data has been entered, the total accrued annual leave based on the contract termination is automatically calculated and displayed. If necessary, this may be manually adjusted by clicking on the little pen.

Click on Terminate to complete the process. The employee’s status automatically changes to inactive, and the termination of the employee is stored.

The employee remains in Active status until a specific action (contract extension or termination) has been performed.

Terminate_employment.png

 

Vacation Leave Calculation

The prorated vacation leave entitlement is calculated based on the contract end date that has been entered. The legal provisions for this are based on Section 5 of the German Federal Leave Act (Bundesurlaubsgesetz; BUrlG).

 

1st half of calendar year (01.01. - 30.06.) 

If the contract end date is in the first half of the year, the accrued leave entitlement is automatically calculated pro rata.

Example (2018):

Calculation based on 01.01.2018

  • Annual leave entitlement: 24 days
  • Contract ends: 30.06.2018
  • Leave entitlement for 2018: 24/12 * 6 = 12 days

 

2nd half of calendar year (01.07. - 31.12.)

Employees who were employed for more than six months of the current calendar year automatically receive the full year’s entitlement.

Example (2018):

Calculation based on 01.01.2018

  • Annual leave entitlement: 24 days
  • Contract ends: 31.10.2018
  • Leave entitlement for 2018: 24 days

 

Contract ends during waiting period

If the contract end date is within the waiting time period, the employee receives, independent of the half year in which the date falls, 1/12 of the total annual entitlement for each full month worked.

Example (2018):

  • Annual leave entitlement: 24 days
  • Start date: 01.07.2018
  • Contract ends: 30.11.2018
  • Leave entitlement 2018: 24/12 *5 = 10 days

Please note that the above examples refer to the accrual policies in the absence settings (Settings > Absence > Accrual policies > New absence policy).

daily_prorated.png

 

Reminders

By default, administrators, as well as employees with an edit right for the section HR Information, receive a reminder of the contract end 30 days + the total of pro rata accrued leave before the corresponding date (e.g. 30 days + 5 days of remaining leave entitlement = 35 days prior).

 

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