How payroll works

HCM Cafe calculates each employee's pay from their approved salary, their attendance for the period, one-time amounts such as bonuses, and your statutory and tax rules. Pay is calculated in a payroll run, reviewed, approved by a second administrator and then released to employees as payslips.

The building blocks

Building block	What it does
Payroll policy	The rules for a group of employees: currency, rounding, pay frequency, how paid days are counted and the attendance cut-off.
Payroll calendar	The pay periods for each payroll year, generated from the policy.
Salary components	The individual lines of pay: earnings, deductions, employer contributions and statutory items.
Pay structure	A template of components that turns an annual salary into monthly amounts. Each component is a fixed amount, a percentage, a formula, the balance of the salary, or a statutory amount.
Pay group	Splits employees into separately processed runs, for example by location or legal entity. Optional.
Compensation revision	An employee's salary, approved through a workflow. The salary in force on any date is the approved revision effective on that date.
Variable pay	One-time amounts for a period, such as bonuses, incentives or recoveries.
Payroll run	One calculation of pay for a policy, pay period and pay group.

A month's payroll, step by step

1. Inputs are ready. Salaries are approved, attendance for the period is processed and variable pay is approved.
2. Create the run for the policy and pay period. Everyone with an approved salary on that policy during the period is added.
3. Process. HCM Cafe calculates pay for each employee: proration by paid days, loss of pay, overtime, arrears, loans, statutory deductions and income tax. Attendance and leave for the period are locked so they can't change underneath the run.
4. Review. Check the employees flagged under Needs a look and the Before you finalize list. Reprocess, hold or exclude employees as needed.
5. Finalize. A different administrator from the one who processed the run finalizes it. Results become permanent.
6. Publish. Employees can see their payslips. Then generate the bank file and export the accounting journal.

See Run payroll for a pay period for the detailed steps.

Corrections after a run is finalized

Finalized results never change. If a salary or attendance changes for a month that has already been paid, the next regular run calculates the difference and pays it as arrears. If a finalized run is wrong and hasn't been published or paid yet, you can reverse it and run the period again.

Who can see salaries

Salary amounts are visible only to payroll administrators and the people who approve salary revisions. Employees see only their own payslips and tax details.

Where to start

• Administrators setting up payroll: Set up payroll
• Employees: View and download your payslips

Reference

• Payroll policy and calendar: pay days basis and cut-offs, with examples
• Salary components and pay structures: value types and formulas
• Processing rules and Attendance summary for payroll
• Arrears, Employee loans and Full and final settlement
• Payslips, bank files and accounting
• Copy, export or import a payroll setup