We strongly recommend that you implement a change in your payroll frequency at the beginning of the calendar year i.e. Your organizations first payroll in January.
We also suggest you create a test division to make the changes there first, then process a payroll and verify the results are what you expect. Then prior to changing anything in your live division, make sure you do a division backup.
It is your responsibility to make sure you have accounted for all the data items on your system that may be affected by this change. If there are a lot of data items to be changed, Professional Services assistance is recommended. Support is available to answer individual questions but not to assist in the overall conversion.
1. Review your leave policies (vacation, sick, etc.), deductions, and overtime. Your current setup would be based on your current pay frequency. If you change your pay frequency, you will need to review the calc cycle, calculations and tables in your historical data items and edit values and flat amounts and percentages in your employee data items. From Master Records List on your Report Menu, print a historical data item list summary and employee data item list summary for a listing of every item that you will need to review.
EXAMPLE: Currently, your pay frequency is semi-monthly (24 payrolls per year). As of January 1, your organization has decided to change your pay frequency to bi-weekly (26 pay periods per year). Currently, you accrue vacation earned at 3.33 hours per pay period. The calc cycle on this historical data item is Y - Calculation Always Used. This will no longer work for bi-weekly payroll because the total hours accrued would be 86.58 (3.33 x 26) instead of 80 (3.33 x 24). You will now need to assign a calc cycle number to this historical data item and enter this calc cycle for the first 2 payrolls of each month, so that it does not accrue on the two months in the year that there are 3 payrolls.
EXAMPLE: Currently, your pay frequency is monthly. As of January 1, your organization has decided to change your pay frequency to semi-monthly. Your health insurance employee data item edit values are currently Single - $50 per pay period and Family - $100 per pay period. You decide to leave the current calc cycle on the health insurance historical data item as Y - always calculate. You will then need to change the edit values for Single to $25 per pay period and Family to $50 per pay period, so that the total withheld for the month will remain at $50 for Single and $100 for Family.
2. Adjust every salaried employees salary amount on their employee record. Take what the annual salary should be and divide it by your new number of annual pay periods and enter that amount in the salary field of the employee record.
3. Also on the employee record, you must maintain the value of the .T FREQ employee data item. This can be accomplish by using the Maintain Employee Data Item Values option from your Payroll Maintenance Menu and selecting Run Option 2 - Update Data Item Value.
4. You will also need to review your payroll columnar reports for the Value From selections for historical data item columns. You may need to change the Value From for your historical data item columns.
5. You may need to review the historical values for your Pay Count historical data item. If you have other historical data items that use Pay Count as an employees age or tenure within the organization, this history will need to be maintained to reflect the new pay frequency.
EXAMPLE: You have a historical data item that uses pay count to go to the proper table for an employees length of time with your organization. Your current pay frequency is semi-monthly and you are changing to bi-weekly. This example employee has been with your organization for 2 years i.e. 24 x 2 for a total current Pay Count of 48. When you switch to bi-weekly, the Pay Count should be 26 x 2 for a total of 52. What will need to be done to adjust the Pay Count will be to Enter Employee History from your Transaction Entry Menu and enter 4 Hours for the Pay Count data item to increase the employees total history from 48 to 52.
6. You will also want to review your procedures for transmitting your payroll withholding liability to your bank. If your pay frequency increases you may be required to transmit your withholding liability more frequently to your bank.