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See how Contracted hours are used on the schedule.

Contract rules let you specify your employees’ contracted hours in order to guide your planning when creating schedules.

You’ll see a comparison of your employees’ scheduled and contracted hours right inside the schedule. Setting these rules allows for better insight into which employees have enough hours, which can be scheduled for additional hours, and which ones have exceeded their contract limit.

This will also be helpful in the further review and approval process of Timesheets.

To better understand the different steps and processes of managing Contract rules and overtime in Planday, we recommend the following steps:

Step 1: Create or adjust a Contract rule

Create Contract rules

Note: If you have enabled an award from our award library you will have preconfigured contract rules already in place.

Click on Create Contract rules to learn more about this process.

Edit an existing Contract rule

Note: If you’ve already enabled an Award in Planday, Contract rules will be created automatically for Full-time, Part-time and Casual employees.

By visiting Settings > People > Contract rules you need to adjust the default values in the various rules and intervals to fit your business/employee agreements. Furthermore, you need to adjust the start date of the contract rule to match the first day of your business pay cycle to ensure alignment between periods and to ensure overtime applies correctly.

Select the rule you want to edit by clicking on the edit icon to the right of the line with the rule's name.

Notes:

Some of the aspects of a Contract rule cannot be modified after the rule has been created and saved.
Any changes to the base contract rule will only take effect from the date the change was made and going forward.

How does changing a contract rule impact existing approved or non-approved shifts on the schedule?

Only shifts created or edited after the change will adopt the new/updated contract rule. Any new shifts with the attached Contract rule will include the changes.

How can you update past and existing shifts on the schedule to reflect the revised contract rule changes?

Any past or existing shifts on the schedule affected by a change to a contract rule will not automatically reflect the changes to those shifts.

Here are two simple workarounds you can try:

Apply a Schedule template: If you want to apply a new or revised contract rule to a specific period, you can apply a template to that period.
Edit and bulk change shift types: Another option is to edit the shift type for a selected number of shifts. After editing, you can bulk change them back to the original shift type. This allows you to make changes to the shift types as needed.

Step 2: Create Shift types

Note: If you’ve already enabled an Award in Planday, you can skip this step and go to Step 4.

You can set up payroll supplements to automatically trigger for payment based on the shift type used.

For payroll supplements to trigger payment based on the use of a shift type, you’ll need to ensure you have all your required shift types set up beforehand. Learn more about setting up shift types in the article Create and use Shift types.

Depending on when the payroll supplement needs to be triggered for payment will determine the supplement type that needs to be selected. Read more about setting up Payroll Supplements.

Step 3: Create Payroll supplements for overtime

Note: If you’ve already enabled an Award in Planday, you can skip this step and go to Step 4.

You can set up Contract rule supplements and link them to a contract rule, so overtime rates will be calculated and added automatically.

Go to Settings > Payroll > Payroll supplement
Press the Create button under Payroll supplement and select Contract rules supplement from the drop-down menu.

Create in Xero as: (This is only visible if you have an active integration with Xero.) You can immediately create the supplement as an earnings rate in Xero or leave it to manually sync later in the integrations settings by following here: Xero integration set-up: Step 2. 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 the supplement should apply to.
Title: Name of the supplement.
Description: (optional) Include a description of the supplement.
Hourly wage:
- % will mean the supplement will be based on a percentage of the individual's hourly wage.
- $ (monetary) will add a set monetary amount to supplemented hours.
Payment period: This is relative to the chosen supplement.
Reset frequency: Select how often the count of hours for calculating the Payment period should reset. This governs whether the hours specified in the payment period refer to:

Per day: daily overtime.
Per contract rule interval: as specified in the Contract rule (e.g. weeks or months).

Days of the week: Select what days of the week the supplement should be applicable.

Days from the public holiday calendar: If you've enabled an Award via our Award Library, the option Calendar assigned to employee will automatically be selected for the relevant supplements. If you haven't enabled an Award, you can either choose the option Calendar assigned to employee or a specific Public holiday calendar so that the system will pick the right days to apply the supplement.
Valid from/to: When does the supplement come into effect or end.
Employee groups: Select which Employee groups are eligible for the supplement.
Employee types: Select which Employee 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. This may not work with percentage-based supplements if the salary period hours are set to zero.
Affected by breaks: when this is checked, if there is an unpaid break, then the supplement will not apply to the time covered by the break.
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.
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.

Step 4: Assign Contract rule to employee

Once you have set up the Contract rules you will need to assign them to the employees to keep track of contracted hours and overtime.

To assign a Contract rule to an employee, go to the People page, hover over the employee’s name and select the pencil icon to edit. From the Employment tab, find the Contract rules section and click on Add.

Select the Contract rule you wish to apply from the drop-down list or search for it. To set a ‘Valid from’ and ‘Interval start date’ for when the rule should start to apply, the date set will need to match the start date of the pay period the employee is allocated to (e.g. Weekly pay period of Monday to Sunday, start date needs to fall on a Monday).

Additionally, you can choose the Interval start date to establish when the measurement of this interval begins. For example, if the start date is set to 1 June with an interval length of 1 week and 38 total hours, we can then expect that 38 hours should be worked from the 1st to the 7th, the 8th to the 14th, and so on.

Note: You can click on an applied Contract rule to see a summary of enforced values or press Edit to make changes such as when to apply the rule and any employee-specific customisations.

Contract rules on the schedule

The application of Contract rules is visually displayed on the schedule page, where you can see which employees are under-scheduled, overscheduled or on par with their contracted hours. See how Contracted hours are utilised on the schedule.

Approve Overtime hours

When you’re ready to approve your employees’ hours, go to Timesheets. You’ll notice that Planday suggests a split shift to approve, corresponding to the scheduled hours and the hours that exceed the employee’s contracted hours. When you approve the hours, the shift with the shift type Overtime will be created in the schedule. ⬇️

Note: You can update the suggested shift type to another in the approval process if needed. However, if you've enabled an award in Planday please refer to the Award before making changes to the suggested shift type to avoid being in breach of your compliance obligations. Alternatively contact the Fair Work Ombudsman to discuss in more detail.

The overtime shift type created will then trigger the appropriate payroll supplement(s), based on the employee’s employee type.

See related articles:

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