Distributing Employees' Pays
Each employee's pay is distributed according to the pay distribution set up for them on the Pay Distribution tab of the Pay Details (MPPP2310) screen. The pay distribution specifies how the employee's pay should be divided up (if at all) and the bank accounts that each portion of their pay should be paid to. In the simplest case, the full balance of an employee's pay will be paid to a single bank account, but it is possible to pay separate amounts to separate accounts.
Employees' pay distributions ultimately determine the contents of the payment batches that are generated when a pay is completed. Batches are displayed on the Batch Payments (MPPP3400) screen, where you can generate bank files for each batch, to be used to transfer funds to employees' accounts.
Setting up Pay Distributions
A pay distribution consists of a set of rules, which are configured as rows on a table. Each row represents a discrete portion of the employee's pay that will be paid to a specified bank account. Each row can be paid to a different bank account, or some or all rows can be paid to the same account. Rows are paid in the order that they appear in the table - this affects how some rows are calculated, and becomes important when an employee's pay amount is not enough to cover all rows.
- Balance - All pay distributions include a Balance row, which is always the last row in the table. After all other rows in the distribution have been paid out, any remaining balance is paid to the bank account specified by the Balance row. If a pay distribution consists of only the Balance row, then the employee's entire pay will be paid to that row's bank account.
- Amount - An Amount row specifies a fixed dollar amount to be paid into the specified bank account.
- Percent - A Percent row specifies a percentage of the remaining balance to be paid into the specified bank account. It is important to note that the amount of a Percent row is calculated as a percentage of the remaining balance, i.e. if a Percent row is the first row in a distribution, it will be calculated as a percentage of the total pay; however, if a Percent row has other rows ahead of it, it will be calculated as a percentage of the remaining balance after the previous rows have been paid.
What if the Employee's pay is not enough to cover all rows in a distribution?
In some cases, it is possible for an employee's pay to be insufficient to cover all rows in their distribution. In this case, the order of the rows determines which rows will be paid - rows are paid in the usual order, until a row is reached where there is no longer enough remaining balance to pay out the full amount specified by the row. A partial payment of the remaining balance will be made to this row, and no subsequent rows will be paid.
Examples
Example 1
| Type | Fixed Amount | Percent | Bank Account |
|---|---|---|---|
| Percent | 7.500 | AccountA | |
| Amount | 100.00 | AccountB | |
| Balance | AccountC |
- $37.50 (7.5% of $500.00) will be paid to AccountA.
- $100.00 will be paid to AccountB.
- The remaining balance of $362.50 will be paid to AccountC.
Example 2
| Type | Fixed Amount | Percent | Bank Account |
|---|---|---|---|
| Amount | 50.00 | AccountA | |
| Percent | 10.000 | AccountB | |
| Amount | 75.00 | AccountC | |
| Balance | AccountD |
- $50.00 will be paid to AccountA.
- $45.00 (10% of the remaining $450.00) will be paid to AccountB.
- $75.00 will be paid to AccountC.
- The remaining balance of $330.00 will be paid to AccountD.
Example 3
| Type | Fixed Amount | Percent | Bank Account |
|---|---|---|---|
| Percent | 30.000 | AccountA | |
| Amount | 150.00 | AccountB | |
| Amount | 100.00 | AccountC | |
| Balance | AccountD |
- $90.00 (30% of $300) will be paid to AccountA.
- $150.00 will be paid to AccountB.
- $60.00 will be paid to AccountC, as $60.00 is all that remains after the first two rows are paid.
- Nothing will be paid to AccountD.