Use pay items to set up the earnings, benefits, deductions, reimbursements, and time off you use for payroll. This way, you can add recurring pay items to an employee's pay, or adjust their pay for a single pay period for a one-time-only pay item like a bonus.
How it works
Pay items help customize and track the way you pay each employee. You can assign recurring pay items (like deductions) to employees every pay run. Or, you can add pay items to adjust their pay for a single pay period for items like bonuses or commissions. There are already default pay items you can choose from, but you can also add your own. If you add your own pay items, you'll need to assign which account it records to in the general ledger for your accounting.
For example, if your organization offers a 401k plan, you can add a pay item for 401k contributions and then add it to an employees pay template. This way, the 401k benefit is added to their pay each payroll.
Add a pay item
From the Settings menu, click Payroll Settings.
Click the Pay Items tab.
Under the Add button, select the pay item type you want.If you are creating a custom pay item for earnings that are your employee's main source of income, select Regular Earnings to see this in the employee's employment tab.
Name the pay item and complete any other details as needed.
Repeat these steps for each custom pay item your organization uses.
After setting up your organization's pay items, add them to your employees' pay templates and leave balances so they are included in each pay run.
Types of pay items
You can add the following kinds of pay items:
- Earnings covers all earnings types, including supplemental earnings such as commission, bonuses, and sick leave.
- Benefits cover anything contributed by the employer in addition to the employee's pay such as health insurance and employer 401k contributions.
- Deductions are amounts taken out of or withheld from an employee's pay such as the employee's portion of health insurance or 401k contribution. Deductions do not include government-imposed taxes.
- Reimbursements can be anything you reimburse employees for such as gas or other expenses.
- Time off pay items cover any time off, paid or unpaid. If you assign expense and liability accounts, we'll create automatic time off journals in the general ledger. Do not select an expense or liability account if you do not want to set up automatic time off journals.