When using Deputy Payroll, employees who are on a salary are set up and paid differently to employees on an hourly rate or award. This article explains how to set up your salaried employees in Deputy with Deputy Payroll enabled, and will cover:

• The different kinds of salaried employees
• Assigning pay rates for salaried employees
• Assigning regular working hours
• Completing the pay run
• Managing Leave for salaried employees

Salaried employees

Employees on a salary can fall into one of two groups in Deputy:

• Employees on salary who do not submit timesheets for worked time
• Employees on salary who do submit timesheets for worked time

This article covers the steps to set up and pay employees who do not submit timesheets for worked time (but may submit leave timesheets).

Note: For employees on salary who do submit timesheets for worked time, this functionality is coming to Deputy in the near future. In the meantime, you can set up these employees with an hourly rate equivalent to their salary and use timesheets to capture their worked time. 

Assigning pay rates to salaried employees

You can assign your team members a salary pay rate in their employee profile. In this example, we've assigned Golly an annual salary of $80,500.

Note: If you have additional pay rates for your salaried employees - such as Salary + Overtime after 45 hours per week - you can set these up in Pay Rate Builder.

In order for this salary to appear on Golly's payslip, we now need to set up her regular working hours.

Assigning regular working hours

Why do we need to set up regular working hours?

For non-salaried employees, their pay is calculated based on the time worked according to their timesheets, following the basic formula:

[Hourly pay rate] X [Hours worked] = [Total ordinary pay].

For salaried employees, however, there is no hourly rate and no record of hours worked. To solve this, we'll use regular working hours to determine the equivalent hourly rate, following the basic formula:

[Salary] / ([Regular working hours] x [Number of work periods in a year]) = [Ordinary hourly rate].

How to set up regular working hours

In the employee's profile in the Employment section, click Edit and navigate to Regular working hours.

First, select the Work period. We've chosen one week, starting Monday. 

Next, input the Hours per work period in one of two ways:

• Selecting Set regular working hours allows you to input the days and times this team member should be working each work period. This option is generally used when an employee has a set roster each week, and it can save you time when scheduling as you'll be able to auto-schedule regular working hours.
• Selecting Set total hours per period allows to input just the total hours and minutes this team member is expected to work. We have selected this option and set the total to 38 hours. This option is generally used when an employee can have varying rosters.

When you're done, click save. Now, the Employment section of Golly's employee profile looks like this, with pay details and regular working hours configured and saved:

Note: the Weekly Pay and Daily Pay calculations shown under Pay Details in the above image are just indicators of weekly and daily costs for this team member and do not represent this team member's actual pay as calculated using regular working hours.

Completing the pay run

When reviewing this employee's pay slip in the pay run, the salary pay line will be broken down like this:

The 'Basic Rate' pay line represents Golly's $80,500 salary, and the hourly Rate is calculated with the formula:

80,500 / (38 x 52) = $40.7389

Note the 'Hours' section in the bottom right of the payslip. You'll see that although this payslip is pulling in 0 hours from timesheets, it's calculating Golly's Ordinary hours worked based on the 38 hours we entered in Golly's regular working hours.

At this stage you can add one-off items to this payslip like bonuses, deductions and allowances before you complete the pay run.

Managing Leave for salaried employees

While your salaried employees may not use timesheets on a daily basis, the one time they will use timesheets is when they take leave. Once a leave request has been approved, the leave timesheet will appear on the Approve Timesheets page on the day that the leave is taken, and will be automatically approved.

Now when we look at Golly's payslip, we'll see two extra pay lines:

• Annual Leave - the STP category for Annual Leave has defaulted to "O"
• Annual Loading - the Class has defaulted to "Extra" and the STP category has defaulted to "O". Note: If the employee's Leave Loading rate has been set to 0 in their employee profile, the Annual Loading pay line will not appear on the payslip.

Note: The updated leave balance will not reflect in Golly's employee profile or on her Deputy app until you lock the pay run.