There’s a lot of ways to do that. The most common are probably accruals that either
1. match the payroll period or 2. Accrue first of the money or 3. Accrue annually
Also, by-hours-worked is gaining popularity since many states now require that method for sick time accrual.
The first step is to decide and then document exactly how your accrual program works. It’s entirely up to you as long as you don’t have any local laws governing your minimum accruals like they have in New Jersey or California. Then once you’ve got it all written out, the implementation portion is usually easy. Timesheets.com actually has all the aforementioned accrual types, plus a few others, built right into the web site. We use it and it has eliminated manual calculations, manual balance tracking and lots of other manual stuff. Definitely worth looking into.