A backdated pay adjustment is a system generated pay element that automatically applies when SelectPay detects a rate change to an effective date in a previous period.
Pay element requirements
For SelectPay to calculate and apply a backdated pay adjustment, the pay element must have use for daily rate selected, and have a backdated rate change. To check this, follow the steps below.
Click Payroll, and then click Employees.
Find and select the required employee.
Click Standard Pay, and then click the required pay element.
Click Open Pay Element.
Ensure the checkbox, use for daily rate is selected.
Click the Effective Dates tab.
Ensure there is an effective date line for a previous period.
Backdated adjustment calculation
The backdated adjustment is calculated from the difference between the old daily rate and the new daily rate. An example of calculating this is below.
Assume the payroll is in July, and an employee has a salary of 2,000.00 per month.
A backdated pay rise has been entered for 3,000.00 starting 1 June.
First, you need the daily rate for both salaries.
2,000.00 * 12 / 260 = 92.31
3,000.00 * 12 / 260 = 138.46
Second, calculate the difference between the two rates.
138.46 - 92.31 = 46.15
Finally, multiply the rate difference by the number of working days, to get the adjustment value.
21 * 46.15 = 969.15
Exclude the pay element
If you wish to remove the backdated pay adjustment, you can exclude the pay element by following the steps below.
Click Payroll, then click Run Payroll.
Find and select the required employee.
Right-click the backdated adjustment pay element.
Click Include/Exclude Pay Element, then click Save.