🎯 This article is intended for users who haven't imported an award via our Award library. You can navigate to Australian awards if you have imported an award via our Award library.
You can create payroll supplements to make automatic adjustments to employees’ hourly rates or salaries based on set criteria. For example, you may want to pay your employees overtime, if they are at work for more than 10 hours during the day by using a normal supplement. Or based on their contract type some employees should be allocated a percentage of their hourly rate if they work on the weekends.
If you are unsure about the supplements that apply to your employees we recommend that you contact the Fair Work Ombudsman, visit the Fair Work Commission website or seek professional legal advice should you require assistance with the necessary calculations or interpretation of the relevant clauses.
How to create a Payroll supplement
First, go to Settings > Payroll > Payroll supplement.
Press the Create button under Payroll supplement. Several options will be available from the drop-down menu:
Supplement type: Normal supplements, Week-based supplement, Day-based supplements and Contract rules supplement.
Create in Xero as:
Note: this field is only shown if you have an active integration to Xero which supports the supplement types Normal, Day and Contract rules.
Here you can choose to create the supplement as an earnings rate in Xero immediately or leave it to do a manual sync later in the integrations settings by following Xero integration set-up: Step 2: Sync payroll data. To create them in Xero immediately, choose either Ordinary Time or Overtime. Ordinary Time is for all your supplements that are not connected to overtime, such as penalty rates.
Contract rule: Option applicable when selecting Contract rules supplement. Select which Contract rule should the supplement be applicable to.
Title: Name of the supplement.
Description: Include a description of the supplement. (optional)
Hourly wage: % will mean the supplement will be based on a percentage of the hourly wage of the individual:
$ (monetary) will add a set monetary amount to supplemented hours.
% (overtime) is used to create time supplements, that will add worked time to an overtime account, as well as extra hours based on overtime.
Note: If $ (monetary) is selected, a new field will display underneath titled Rounding method which will allow you to select one of the following settings:
No rounding: will pay the supplement amount for the exact time worked
Round up to the nearest hour: will pay the supplement for every part of an hour started.
Start type:
1. Hour: The supplement is controlled from a start and end time.
2. Relative to Shift: this option will allow you to start the supplement after a certain number of minutes into the shift.
2.a. Applies after: by choosing the value ‘240’ the supplement starts after the employee’s shift has lasted 240 mins.
2.b. Duration: it refers to how long the supplement should last in minutes. If you want the supplement to apply to the entire shift beyond the 4 hours, please set the duration to e.g. 1200 minutes.
Payment period: This is relative to the chosen supplement. See the descriptions below and further examples.
Weekdays: Select what days of the week the supplement should be applicable.
Days from Public Holiday calendar: You can choose the Calendar assigned to employee option or a specific calendar so that the system will pick the right days on which to apply the supplement.
Valid from/to: When does the supplement come into effect or end.
Partially valid range: Option available when selecting a week-based supplement.
Employee groups: Select which Employee groups are eligible for the supplement.
Employee types: Select which Employee types are eligible for the supplement.
Shift types: Select which shift types are eligible for the supplement.
Affects salaried employees: If selected, the supplement will also affect those with a fixed salary rather than an hourly rate.
Affected by breaks: If there is a break in the shift, should the break affect the shift time and therefore the total amount of time being affected by the supplement.
Enforced payment: Enable this to ensure that the supplement is always added to the pay – even though other supplements are present in the same period of the shift.
Note: When enabling this option, it’s important to proceed with caution and consider the potential impact on the payout of other supplements that may apply to the same shift. As enabling this option may obstruct the inclusion of those other supplements when they may need to be included as an addition rather than be overwritten.
Allow over midnight: Select if a shift goes over midnight, potentially into a day not selected as being covered by a supplement, should the supplement continue to apply on the hours that fall in the next day after midnight.
Supplements by shift type
Supplements can be set up to trigger payment based on the use of shift types for scenarios where overtime, penalties and loadings are required. When particular shifts in the schedule are labelled using shift types, there is a clear definition of when an employee is scheduled to work ordinary hours, is on leave (Annual leave, Compassionate leave, etc.), or is scheduled to work overtime.
The following supplement types cater for shift types:
Normal
Day-based
Week-based
To see which shift types trigger supplements for overtime, penalties and loading in relation to an award enabled in Planday, navigate to one of the award articles located in the Australian awards collection.
Normal supplement
Normal supplements are used when an employee’s pay rate should be adjusted at a certain time of the day, or after a specified amount of hours into a shift. You can set the increase or decrease in pay rate based on a percentage of a wage or as a set monetary value.
Shown below is an example of a Normal supplement for an Employee group named Chefs. After 8.5 hours Chefs should be paid an additional 50% of their normal wage, but only up to a maximum of 3 hours.
Note: if you create a supplement that has a fixed start and should cover shifts that cross over midnight, you should be aware that it might be added early in the day as well. For example, if you create a supplement rule to be applied from 00:00 to 06:00 and your working days are set from Monday to Friday, you should be aware that the supplement will be applied early Monday (between 00:00-06:00).
Day-based supplement
Day-based supplements are used when employees work more than one shift per day. The day-based supplement will account for all hours worked during the day.
The first payment period refers to the time of the day when the supplement is active. Set this to 00:00-00:00 if you want the supplement to apply throughout the day.
The second payment period defines the threshold after which the supplement kicks in and the maximum application of it.
Shown below is an example of a Day-based supplement to be applied to days in which the employee works more than 9.00 hours between 8:00 and 21:00. A limit of 24 hours applies to this supplement.
Week-based supplement
Week-based supplements are used to apply a supplement after a set number of hours worked in a week.
Note: this supplement should only be used if you are not using the Contract rules and thereby can’t use the Contract rules supplement. This supplement does not transfer to Xero.
The first payment period refers to the time of the day when the supplement is active.
The second payment period defines the threshold after which the supplement kicks in and the maximum application of it.
Shown below is an example of a week-based supplement that will apply an additional 50% of an employee’s normal wage after 40 hours have been worked in a single week. This supplement should count hours worked between 08:00 and 21:00, and have a cap of 58 hours, allowing for a total of 18 hours in which this supplement can be active in a single week.
Contract rules supplement
A Contract rules supplement can be applied to all employees that have a specific contract rule to pay them automatically for any overtime supplements. For this type of supplement to work, you should already have contract rules set up for different employee types under Settings > Contract rules > Create Contract rule. This governs how many hours an employee should be working and lets you see and compare if they go beyond the contracted hours in the schedule and pay them a supplement.
See related articles:
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