A salary offset deduction reduces an employee's salary to account for their absences, aiming to ensure fair compensation during periods of sick leave.
Incorrect salary offset deductions can happen for the following reasons:
Cause 1: The daily rate looks incorrect.
The daily rate is determined by the number of days set at the pay group level. To check this, follow the steps below in portal.
Click Settings then under Codes, click Pay Groups.
In the Pay Group Code drop-down menu, select the relevant pay code.
In the Days in Year field, update the value.
If the employee is salaried, divide their salary by the number of days in the year to calculate the daily rate. Then, multiply this daily rate by the number of sick days taken during the period. If this results in a different amount, check the override settings associated with the sickness category according to the article "Occupational Salary Offset for Absence using the Wrong Hourly Rate."
Cause 2: An employee has taken 10 sick days
For example, if an employee works 20 hours per week (4 hours per day) and has taken 10 sick days, their salary is £18,720 (£9 per hour). The total absence should account for 40 hours; however, the payslip reflects a deduction of 80 hours instead of 40 hours.
This discrepancy usually occurs when the employee's pay group is set to apply a daily rate rather than an hourly rate. To resolve this issue, take the following actions:
Check the pay group settings assigned to the employee.
If the employee is paid hourly, ensure that the pay group is set to HOURLY.