Set up payroll before the first run

Payroll pays what the system knows at the moment you process the run. Attendance, approved leave, permissions, penalties, loans and benefits are copied onto the payslips at that moment. Get the inputs right first, then process, then approve and pay. The Payroll Guide screen walks through the same cycle, and every payroll screen links to it.

Open the guide

1. Open People › Payroll › Payroll Guide.

2. Read Read this before your first payroll run, the seven numbered steps, Rules worth remembering and Fixing a mistake. Each step links to the screen where you do it.

The cycle, step by step

Set up the rules (one time)

• In HR Settings, set the working hours, weekend days, overtime and the social insurance method. The method is None by default, which deducts no insurance at all.

• If you charge for unexcused lateness, set the missing time blocks and multipliers on the Payroll tab.

• If income tax is progressive, define the brackets on the branch's country profile in Payroll localization, and set Statutory figures come from to The branch's country profile in HR Settings; the insurance rates then come from that profile too. With no brackets the tax is zero and nobody is warned.

• Create at least one active deduction salary component; loans cannot be disbursed without one. See Salary components.

• Decide which leave types are paid. An unpaid type is deducted day for day, so the flag is a pay decision. See Leave types.

• To post salaries to the books, switch on General Ledger integration and map the accounts: How payroll posts to the general ledger.

Prepare employee data

• Every employee needs a basic salary. Only employees whose status is Active and who belong to the run's branch are paid.

• Add the bank name, account number and IBAN of everyone who must appear in the bank file.

• Recurring allowances and deductions are picked up while they are active and their dates cover the period. A percentage allowance is a percentage of basic salary. See Employee allowances and deductions.

• Benefit enrollments affect pay only when they are active, set to be deducted from payroll and carry a monthly employee cost.

Collect the month's data

• Complete attendance: entered by hand, imported, or fed by fingerprint devices. It drives present days, absent days and overtime hours.

• Approve leave requests and hourly permissions before processing. Approving afterwards changes nothing on payslips already produced.

• Review attendance policy violations and approve the penalties you want deducted; only approved penalties not yet deducted are taken.

• Disburse approved loans. Disbursement creates the monthly repayment deduction.

• Never add a penalty or a manual deduction for unpaid leave, absence or lateness. Payroll already deducts all three, and a second entry takes the money twice.

Create and process the run

• A run covers one period for your branch; the system refuses repeated or overlapping periods. See Run the monthly payroll.

• Processing calculates a payslip for every active employee. The figures are a snapshot. See How a payslip is calculated.

Review, approve and pay

• There is no approval of the whole run. Payslips are approved one by one or in bulk, and approval can be given by a different person.

• Marking a payslip paid is the money step and posts the journal entry when integration is on.

• Generate the bank file only after payslips are paid. See Approve, pay and send payslips.

Fixing a mistake

As long as no payslip is paid, a completed run can be rolled back: its payslips are deleted, loan balances and installment counts are restored, and the penalties it deducted are released for the next run. Correct the data and process again. Once any payslip is paid, rollback is blocked until you reverse the payments in accounting.

Common questions

Do I have to follow the steps every month? The one-time rules stay in place. Each month you collect the data, process, review, approve and pay.