Defining pay codes

When you define pay codes, you decide how pay associated with the pay code calculates and you can, optionally, identify the accounts in the general ledger to which the pay expense is charged.

Note: It is important that you tie delivered pay classes to pay summary groups before attempting to create the pay codes.

See Defining pay summary group relationships.

Access Pay Code (PR20.4).
If you want this pay code to be used only for employees in a specific process level, then select the process level in the Process Level field. You can select both a process level and a job code.

Note: You can override the employee's job code at time record entry to correspond with the job code defined for the pay code.
If you want this pay code to be used only for employees assigned to a specific job code, then select the job code in the Job Code field. You can select both a job code and a process level.
Specify the pay code in the Pay Code field.
Specify a name for the pay code in the Description field.

Note: For calculation types Percentage Rate; Rate Shift Differential; Percent Shift Differential; Percentage with Shift Diff; Percentage with Percent Shift Payroll divides the annual salary by annual hours multiplied by the FTE from the employee record.

In the Calculation Type field, select the way in which to calculate the pay associated with this pay code:


If you want to calculate pay	Select
Based on the rate on the employee time record (using pay rate defaulting logic)	Normal Rate
Based on a percentage you type in the Rate field, Overtime Premium field, or both	Percentage Rate
Based on a normal rate with a rate shift differential	Rate Shift Differential
Based on a normal rate with a percentage shift differential	Percent Shift Differential
Based on a percentage rate with a rate shift differential	Percentage with Rate Shift Diff
Based on a percentage rate with a percent shift differential	Percentage with Percent Shift Diff
As non-cash, such as automobile allowance, moving expenses, excess group term life This type of pay updates taxable wages	Non-cash Income Note: A non-cash pay code must be tied to a pay summary group which is tied to the NON pay class.
As the hours associated with an event, not the dollars	Hours Only
Based on a user-defined calculation	Custom Calculation
As an additional flat rate to be paid that does not calculate against any hours entered or relate to employee's normal rate or hourly rate	Additional Flat Rate
Based on the daily rate of the employee (using pay rate defaulting logic) Not valid for US and Canada setup.	Based on the Payable Days
Based on a percentage you type in the Rate field, Overtime Premium field or both. The annual calendar days. Not valid for US and Canada setup.	Percentage Annual
Based on a percentage you type in the Rate field, Overtime Premium field or both. The pay period days. Not valid for US and Canada setup.	Percentage Pay Period
Based on an average number of days that are specified in the Rate field, this is the number of days to look back to for time record hours and wages	Weighted Average

Specify the pay class to which you will be assigning pay summary groups. Pay classes must already be established on Company Parameter Maintenance (HR00) or Pay Class Maintenance (PR20).

Use this field with the (C) Percentage Pay Class/Current calculation type. If you leave this blank, then the current earnings are used.
Depending on the calculation type that you selected, select additional calculation parameters. Use these guidelines to specify the field values:
Service Code

If you use Absence Management processing, then select the service code associated with this pay code.

Attendance Code

Select the code that represents a reason for an employee's absence or hours worked.

Rate
The rate or percent used to calculate pay.

Use with calculation types:
- Normal
- Percentage Rate
- Non-cash
- Additional Flat Rate
- Percent of Current Earnings
- Percentage Annual
- Percentage Pay Period
Currency

The currency of the rate of pay.

Overtime Premium
The premium rate used to calculate workers' compensation premiums based only on the straight time portion of the overtime pay and to post the amounts to a separate general ledger account.

Use with calculation types:
- Percentage Rate
- Percentage with Shift Differential
- Percentage with Rate Shift Differential
Shifts (1-4)
The shift premiums used to calculate pay based on the employee shift.

Use with calculation types:
- Rate Shift Diff
- Percent Shift Diff
- Percentage with Rate Shift Diff
- Percentage with Percent Shift Diff
Shift Table
The shift table that you want to use to calculate pay.

Use with calculation types:
- Rate Shift Diff
- Percent Shift Diff
- Percentage with Rate Shift Diff
- Percentage with Rate Shift Diff
Units of Measure

Select the unit of measure for this pay code.

If a unit of measure pay code is being used and this pay needs to be used for FLSA calculation, benefit eligibility, and/or benefit vesting, then you must use a unit of measure pay code that allows hours.

FLSA calculation and benefit vesting all rely on the number of hours for calculating correctly.

Allow Hours

Select whether to allow hours to be entered with other units of measure.

This is only valid with the Rate X Unit calculation type. Select Yes if the hours for unit of measure pay need to be included in overtime.

Non Earnings

Select whether the pay code will be used for non-earnings such as mileage or tuition reimbursement.

Non-earnings are not used in tax calculations or for prorating deductions.

Payment reporting will separate earnings from non-earnings.

Pay Summary Group

The pay summary group to which this pay code belongs.

Disposable Income

Select whether the pay associated with the pay code is included in or excluded from disposable income.

Payroll uses disposable income to calculate garnishment deductions. If you select Include/Exclude, then it will show to all garnishments. If Include/Exclude applies to individuals, define it at the garnishment level.
To use general ledger accounts, you must define them for the pay code. Use these guidelines to specify the field values:

Wage Expense

The general ledger expense account that you want to define for the pay code.

Premium Expense

For pay codes with overtime premium rates, select the premium expense account to which you want to associate the premium portion of pay.

Note: Click Premium Expense to define premium expense accounts for specific job codes.

Shift Expense

For pay codes with shift differential rates, select the shift expense account to which you want to associate the shift differential portion of pay.

Non-Cash Credit

For pay codes with a non-cash calculation type, select the credit account.

If you leave the Non Cash Credit fields blank, then the application uses the non-cash credit account defined for the company.

Activity

Select an activity to associate the pay code.

Override Ded Expense

Add field for PR197 processing of company paid deduction expenses.

Post Hours and Units

Add field for PR197 processing of company paid deduction expenses.
Use the Global tab fields to define additional pay code attributes that will be checked for processing time records.

Base Pay flag

Select whether the pay code will be identified to employee’s Rate of Pay. If Yes, then employee’s rate of pay is used for calculating wages.

Retro Pay Code

Select the linked pay code use when Retroactive Pay Rate Change Calculation (PR133) generates retroactive time records.

Related reports and inquiries


To	Use
View a listing of pay codes, pay classes, pay summary groups and pay summary group relationships	Pay Code Listing (PR220)