Configuring pay codes is a crucial step in payroll management that ensures accurate classification of employee earnings, deductions, and benefits. This process involves defining specific codes that represent various types of compensation, such as regular pay, overtime, bonuses, and deductions for taxes and benefits.
Pay codes in PeopleXD can be configured in different ways, which affects how they calculate payroll values. For example, standard value pay codes can be operated on a hours, days, units or value basis, while scaled value pay codes are paid based on the point the employee is set at on a set scale.
It is essential to configure pay codes to facilitate precise payroll calculations, maintain compliance with labor laws, and generate accurate financial reports.
To help you configure pay codes, watch the video or follow the steps below.
Click Settings then under Codes, click Pay Codes.
Click Create New Pay Code.
šNote: We recommend cloning an existing pay code, where a similar one exists, by clicking Clone from the three-dot menu.
From the Payment Type drop-down menu, select a payment type.
From the Payment Subset Type, select a subset type.
In the Pay Code field, enter a unique number.
In the Description field, enter a description then click OK.
Complete each step in the Pay Code Wizard screen then click Save.
For further guidance, check the pay code wizard user guide.
Troubleshooting misconfigured pay codes
šNote: We recommend testing any configuration changes in your UAT environment first to verify the results before applying them to the live system.
Misconfigured pay codes or missing configuration details, such as unit rates, can lead to incorrect payroll calculations, causing discrepancies in employee payments. To resolve these issues, follow these steps:
Identify the configuration type: Determine whether the pay code is a standard value or scaled value pay code.
Clone an existing pay code: Clone an existing pay code with the correct configuration since the creation type cannot be changed after creation.
Adjust the formula: Modify the formula in the cloned pay code to meet specific requirements.
Use the new pay code: Replace the misconfigured pay code with the newly cloned and adjusted pay code for future payroll periods.
Ensure unit rates are configured: If a units-based pay code fails to calculate pay, verify that a personal or position unit rate is set up for the employee. Without this, payroll calculations will result in exceptions.