Nominal Payroll tutorial
Type of employees:
1. Salary employees – work on a full time salary. Salary is calculated based on their Wages type (Hourly rate, daily rate, weekly salary or yearly salary) and the wages figure.
For example if the wages type is daily and the wages figure is 100, than the employee will receive $100 per day.
2. Timesheet employees – work on a timesheet basis, their salary is calculated based on the number of hours worked in the pay cycle period.
Their work is recorded on the Nominal time sheets and the hours can be recorded with different rates. Within the timesheet you select the Service which the work is attributed to. The service is defined under the Nominal services and the service “buying price” is used to determine the salary of the employee.
For example you record 30 hours of work within the timesheet,20 hours are for “Cleaning” and 10 hours for “fixing”. The two
services are created within the Manage->Items with the following buy prices:
· “cleaning” buy price $20
· “fixing” buy price $50.
For the weekly pay cycle the employee will be entitled to 20 hours * $20 for cleaning = 400 and 10 hours * $50 = 500 for fixing with a total of $900 for the week
Pay Frequency
Pay frequency is the cycle type for which this employee will get a payslip. Three options are available:
· Weekly
· Fortnightly
· Monthly
The employee salary is calculated based on the two options above and totalled for the payslip created for the pay cycle.
Leave Types
Nominal enables you to setup your own leave types for your employees. Leave types usually include:
· Annual leave
· Sick Leave
For each leave type you configure the number of hours each employee will be entitled for the entire year. For example 150 hours of annual leave is 20 days of paid leave when the hours per weeks are 37.5 (the default)
For each leave types you can define whether the employee will be paid for the leave taken. In this case Nominal will add the leave taken to the hours worked in the pay cycle for a timesheet employee.
Record leave
The record leave table allows you to record leave taken by your employees. Each line represent one period of leave taken for a specific employee for a certain type of leave.
For example if an employee takes 5 days of annual leave you will record to date started, date ended, the leave type (annual leave) and the number of hours will be calculated as 37.5 taken.
Pay Cycles
Pay cycles are the cycle of payment for your employees, if all employees are paid weekly than the pay cycles will be weekly. If you have monthly paid employees Nominal will generate monthly pay cycles.
Each pay cycle includes (on the bottom below) all the employees that are paid on the same cycle type. When a new weekly cycle is created all pay slips for employees paid on a weekly basis will be automatically added to the pay cycle.
You can create pay cycles manually by clicking the Add button, or let Nominal create the required pay cycle when a new pay cycle starts. (by clicking the payroll button)
Pay slip Base salary
Nominal generates the payslips for the appropriate employees based on their payment frequency.
Base salary is calculated for each employee type:
1. Salaried employee
Nominal will calculate the base salary for a salaried employee based on the table below, converting between employee salary type and the payment cycle type as necessary.
|
|
Payment Cycle | Payment Cycle | Payment Cycle | |
| Weekly | Monthly | Forthnightly | ||
| Employee salary | Weekly | Weekly | weekly*4.33 | weekly*2 |
| Employee salary | Daily | Daily*5 | Daily*5*4.33 | daily*10 |
| Employee salary | Hourly | Hourly*37.5 | hourly*37.5*4.33 | hourly*37.5*2 |
| Employee salary | Yearly | Yearly/52 | yearly/12 | yearly/52*2 |
2. Timesheet employee
Timesheet employee salary is based on the actual hours worked within the pay cycle times the “buying price” for the service which the employee worked on.
Pay slip calculations
Nominal calculates the following fields within the Pay slip:
- Base salary – as described above for the employee and the pay cycle
- Super – is calculated as a percent of the base (base does not include super). The percent is setup in the employee payroll details and defaults to 9%
- Gross – includes the “before addition” and reduces the “before deductions”
- Tax – is based on the employee weekly salary and the Tax category that is setup for the employee
- Net Pay – is based on Gross minus Tax plus “after addition” and minus “after deduction”
Pay slip Hours worked/Leave taken:
Based on the type of employee Nominal will calculate the following:
1. Salary employee
Calculate the number of leave hours taken within the pay cycle for each leave type.
Nominal will go through all leave records for the employee and calculate the number of hours (business days not including weekends and public holidays) that have been taken within the current pay cycle.
2. Timesheet employee
Nominal will calculate the number of hours worked and the rate (buying price for the service recorded on the timesheet) within the pay cycle.
For example if the employee worked 20 hours in the week and the service rate is $10/hour than Nominal will return 20*10 in this area for the employee. This is the same amount that will be calculated as the base salary.
If a timesheet employee takes leave, than the number of hours taken is also considered as part of his base salary and the amount per hour is taken from the employee “leave rate”
Leave earned (this period):
This table describes the number of hours that employee has accrued (earned) for this pay cycle. This is calculated in the following way:
1. Salary employee
The salaried employee will earn the following number of hours for each pay cycle:
· Weekly = yearly hours (earned for the leave type) / 52 weeks.
· Fortnightly = yearly hours (earned for the leave type) / 52 weeks * 2
· Monthly = yearly hours (earned for the leave type) / 12 months
2. Timesheet employee
The timesheet employee will earn prorate of the hours worked in the period/ total business hours in the period.
So if the employee worked a full week he will earn the full leave hours (as the salaried employee)
The employee will earn a percentage of the hours that the full employee earns (as described above) based on the hours worked divided by the total business hours.
For casual and temporary employees Nominal will not calculate any leave accrual.
Leave balances (before period):
This section shows the leave balances for the employee at the time before the current pay cycle.
Nominal will not show leave types balances that have been created with the “show on pay slip” option turned off.
Nominal calculates the current balance of the employee (for each leave type) by getting all the older payslips for the employee and summing the number of hours accrued in each previous pay slips and reducing the number of hours taken for each pay slip.
Employment Type
Employment type assists Nominal with determining whether the employee is entitled to leave accrual.
The following employment type exists:
· Full Time – entitled to leave
· Part Time – entitled to leave
· Casual – not eligible for leave accrual
· Temporary – not eligible for leave accrual
For casual and temporary employees Nominal will not calculate any leave accrual.