Pay Categories

Pay Categories

Pay Categories are used to define the rates that employees are paid. Setting up your pay categories will help simplify the management of employee pay rates by: 

• Automatically calculating linked rates through loading and penalty rate multipliers
• Configuring super rates
• Configuring leave accrual

Please note that by default a number of standard pay categories have already been created. However, you can create new pay categories if you need.

To create a new Pay Category;

1. Go to Business > Payroll Settings > Pay Run Settings > Pay Categories

2.Click the +Add button on the top right corner of the pay category page.

3. Enter a name for the Pay Category and click Save.

4. Then you can enter below details

• Units - If the pay category is processed on a per hour basis, select "Hourly". If the pay category is to be used as a primary pay category for employees earning an annual salary, select "Annually". If the pay category is for a per unit payment, for example a vehicle allowance or bonus, select "Fixed". You will also notice when a pay category is set as "Fixed", you will not be able to select the "Accrues Leave" setting.
• Exclude from Average Weekly Earnings - Ticking this checkbox means that any earnings paid under the pay category will not be calculated towards the employee's Average Weekly Earnings, as part of annual holiday calculations.
• Exclude from Ordinary Weekly Pay - Ticking this checkbox means that any earnings paid under the pay category will not be calculated towards the employee's Ordinary Weekly Pay, as part of annual holiday calculations.
• PAYE Exempt - Tick this checkbox if the earnings are tax free.
• KiwiSaver Exempt - Tick this checkbox if the earnings are KiwiSaver exempt.
• GST Exempt (option only available if contractor management function enabled) -Tick this checkbox if the earnings are GST exempt. Only applicable for independent contractors who have registered for GST(Refer to Advanced Settings for more information on enabling the contractor management function).
• ACC Levy Exempt - Tick this checkbox if the earnings are ACC levy exempt.
• External Id: A value is only required here if you are using an external system to capture timesheets or earnings lines and so need to map the code used from such external system. If an external id is used that has been used before you won't be able to save it if the 'unique external Id' setting is switched on. This setting is located on the Payroll settings > Advanced settings page. See here for more information. 
• Accrues Leave - If employees are accruing any type of leave based on the "hours per hour worked" accrual method, this setting will determine whether any leave hours will accrue when the employee is paid against the pay category in a pay run. If the checkbox is NOT ticked, employees will not accrue leave on an hours worked/paid using this pay category.
• Rate Precision - Option to set rate at between 0 and 6 decimal places. If adding additional earnings lines for an employee (configured in the employee's Pay Rates screen), the rate can be specified up to 6 decimal places regardless of the pay category setting. Please note however in the pay run, rates will only calculate up to a maximum of 5 decimal places.
• Rate Loading - If you want to pay an all uploading for an employee on the base rate of pay, you can configure that in this setting. For example, if an agreement has been reached that an employee will work a certain number of overtime hours and will be paid an additional 10% on their agreed base rate for all hours worked against that pay category, you can enter "10" in that field.
• Hide units on pay slip - When paying employees, there may be pay categories where you do not require the number of units and rate per unit to be displayed on the pay slip. Examples include paying a commission or bonus, or the primary pay category for salaried staff. Even though the units will still be displayed in the pay run, ticking this checkbox means they won't appear on the pay slip. For eg, if you have ticked the setting for the 'Salary' pay category, the pay run will still appear as follows:
  
  
  

5. Once done, click Save