Correct Pay Rates on a Check

Underpayment of Wages

If a payroll check has been posted through the system with the wrong pay rate, and the check has already been given to the employee, then the difference that is owed to the employee should be issued on a separate check and not included in the next pay period's check.  If your company is union or pays prevailing wage, then the union reports and the certified payroll reports would be affected by the date given as the week-ending period, therefore, the correction should be issued on a separate check.  

The correction is entered into the time card entry screen with two separate entries.  The first entry will represent the total hours (entered as a positive number) at the correct rate and the total hours will be certified on one specific day, such as Monday.  The original check entry may have disbursed the total hours to various days but for this purpose you will certify them on one day only.  The second entry will represent the total hours (entered as a negative number) at the old rate, and the total hours are certified on another day, such as Tuesday.  Use transcode 121 on this entry in order to manually enter the old rate.  It is very important to certify the hours in such a way that the net hours for any given day do not net to zero, otherwise, the certified payroll report will not print the check information.  You may also want to manually note on the certified payroll report that the entry is an adjustment of pay to avoid confusion when the report is submitted.

The two entries noted above will serve two purposes.  First, the net of the total hours are zero so the overall hours for the pay period are not overstated.  Second, the system automatically calculates the net difference to the employee.  Third, any miscellaneous pays associated with the union/prevailing wage code will be picked up by the system.  Dating the entries in the same original week ending will properly reflect the information on the union report and/or the certified payroll report.  

Overpayment of Wages

If a payroll check has been posted through the system with the wrong pay rate resulting in an overpayment of wages, and the check has already been cashed by the employee, then the difference that is owed to your company should be deducted from the next check issued to that employee.  This can be accomplished by creating a local deduction code and attaching this deduction to the employee's file.  This is especially helpful if you need to deduct a portion of the total amount over several pay periods and need to establish a cutoff limit.  

The correction is automatically entered onto the time card entry screen by the system once you save your first time card entry for the employee. If you do not set up the local deduction code in the employee file, then you may manually enter the correction on the time card entry screen by selecting transaction code 99, and the local deduction code, and then entering the flat amount.  Enter the amount as a positive amount, not a negative amount.  

If your company is union or pays prevailing wage, then the union reports and the certified payroll reports will not be affected by this entry.