When an employee's rate changes partway through a pay cycle, pay the current cycle at the original rate and enter the extra amount owed at the new rate in the Differential Pay field on the Payroll tab of Labor Management. After payroll is finalized, update the employee's rate in their profile so future payrolls use the new rate. The exact calculation depends on whether the employee is hourly, salary, or moving from hourly to salary.
Hourly employee with a rate increase
Continue to pay the hours worked at their original rate. For example, a Night Auditor's rate increases from $14.00 to $15.50. Hours worked of 38.10 x $14.00 = $533.40, which calculates automatically when payroll is processed.
Then calculate the amount owed for hours worked at the higher rate. Here, they worked 2 days (16 hours) at the new rate, and the rate increased by $1.50, so the additional amount owed is 16 hours x $1.50 = $24.00. On the Payroll tab, click the employee's name and enter $24.00 in the Differential Pay field.
Once payroll is finalized – typically the following day – open the employee's profile in User Management and enter the new Hourly Rate so all future payrolls use it.
Salary employee with a rate increase
Continue to pay the current cycle at the original salary. For example, an Assistant General Manager's salary increases from $45,000 to $47,500 – an additional $2,500 per year, which equals $9.62 more per day ($2,500 / 52 weeks / 5 days). They worked 2 days at the new rate, so they are owed 2 x $9.62 = $19.24. On the Payroll tab, click the employee's name and enter $19.24 in the Differential Pay field.
Once payroll is finalized – typically the following day – open the employee's profile in User Management and enter the new Salary Amount so all future payrolls use it.
Hourly employee changing to salary
Continue to pay the employee as hourly for the current pay cycle, and pay them as salary starting the next full pay cycle. For example, they worked 30.10 hours as hourly, then 2 days as a salaried manager. The 30.10 hours x their current hourly rate calculates automatically with payroll.
Calculate the 2 salaried days manually. If their salary will be $45,000, the daily pay rate is $173.08 ($45,000 / 52 weeks / 5 days). On the Payroll tab, click the employee's name and enter $346.16 ($173.08 x 2 days) in the Differential Pay field.
Once payroll is finalized – typically the following day – open the employee's profile in User Management, change their Employee Type from Hourly to Salary, and enter the new Salary Amount so all future payrolls use it.