How does the system prorate an employees' salary?
This feature is available on all PaySpace editions
The system prorates the Basic Pay based on an employee's employment, termination or suspension dates. The proration calculation can be configured using the following company settings.
Option 1 | If the below setting is activated.
Navigate > Config > Payroll > Payroll Config > Calculation Settings > Proration
Example : Employee terminated 15 October 2024.
Pay Rate : 20,000.00
Working Days : Monday to Friday
Days per Period : 21.67
Calculation : 20,000 [Package] / 21.67 = 922. 93
922,93 X 11 [Employee days worked] = 10 152.28
Option 2 | If the below settings are activated.
Navigate > Config > Payroll > Payroll Config > Calculation Settings > Proration
Example : Employee terminated 15 October 2024.
Pay Rate : 20,000.00
Working Days : Monday to Friday
Actual Working Days per Period [1 to 31 October 2024 - excl. Weekends] : 23
Calculation : 20,000 [Package] / 23 = 869.56
869.56 X 11 [Employee days worked] = 9565.22
Important If the second proration rule is enabled, it has to be done in conjunction with the first proration rule enabled.
Option 3 | If the below field ' Prorate by this many days' is activated.
Navigate > Config > Payroll > Payroll Config > Calculation Settings > Proration
Example : Employee terminated 15 October 2024.
Pay Rate : 20,000.00
Working Days : Monday to Friday
Prorate by this many days : 24
Calculation : 20,000 [Package] / 24 = 833,33
833,33 X 15 [Employee days worked, incl. Weekends] = 12500.00
Option 4 | If no settings are enabled.
Navigate > Config > Payroll > Payroll Config > Calculation Settings > Proration
Example : Employee terminated 15 October 2024.
Pay Rate : 20,000.00
Working Days : Monday to Friday
No proration setting enabled
Calculation : 20,000 [Package] / 31 (full month - Oct) = 645,16
645,16 X 15 [Employee days worked, incl. Weekends] = 9 677,42
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