Managing Payroll Departments
Note: employees who work primarily from home will not be able to be assigned a department at this time. However, we have new functionality coming soon. Sign up for beta access today!
As a Payroll customer, you can set up and manage departments. This will allow you to classify your employee payroll by groups and report on dollars per department. If you have Accounting, you can also Manage Departments in Accounting.
Setting Up Payroll Departments
- Go to Settings > Company Settings > Manage Departments
- Click “Add New.”
- Enter the department name, up to 50 characters.
- If you have both Accounting and Payroll, you will need to indicate that this department should be used in Payroll. Otherwise, it will only be used in Accounting.
- If you have more than one work location, select the locations this department can be used.
- Click “Save.”
The departments you set up at the company level can now be assigned to work locations first and then employees.
Assigning Departments to Multiple Work Locations
If your company has more than one work location, you will need to assign departments to each work location, to narrow down the list of departments when assigning to employees. Employees working in that location can only be assigned departments assigned to that work location.
- Go to Settings > Company Settings > Manage Locations
- Click the Location name to edit.
- Select from the list the departments you want to use at this location.
- Click Save.
Assigning Departments to Employees
To properly report employees by department, you must assign at least one department to each employee. Departments are assigned on the employee’s “Pay Info” screen. Go to Payroll > Employee List > Click Employee Name > Pay Info > Edit.
For each pay rate assigned to the employee, select a department from the dropdown list. You may assign up to five departments per person. If this employee has multiple pay rates, you can assign the same department if needed. If you need to assign multiple departments for the same pay rate, you will need to enter a different pay rate description for each rate.
Click “Add A Department” to assign a department to this employee. You may assign an unlimited number of departments to salaried employees.
If you have assigned more than one department to a salaried employee, choose your department salary allocation preference:
- Allocate on a payroll-to-payroll basis: Each time you run a payroll, you will need to select the department(s) for this employee’s salary.
- One-time, ongoing allocation – You can either allocate a dollar amount or percentage of their salary to more than one department if needed. You can change the allocation when you run payroll if needed.
- Click Save.
Using Departments in Payroll
After you have assigned employees to departments, when you enter payroll, you will see a “Department” column on Payroll Step 1. The assigned department will display each pay rate for each employee.
Each pay rate and department is a row on the sheet. If you need to make a change, you will need to cancel the payroll and edit the employee’s Pay Info page.
Any additional money paid to hourly employees, such as a bonus, will be allocated to the employee’s primary department, which is shown in the first row.
If a salary is allocated to more than one department, you will see the Salary Rate divided among each department, as you had indicated on the employee’s Pay Info tab.
Any additional money paid to salary employees, such as a bonus, will be allocated to the employee’s primary department, which is shown in the first row.
To Change Salary Allocations in Payroll
- If you need to change the allocation, click “Re-Allocate Rates” and enter the updated dollars allocated among the departments for this payroll. Note the dollar amounts must equal the total salary pay rate.
- To reset the allocations back to their original setting, click “Reset Allocations.”
After payroll is run, you will be able to view a breakdown of your department dollars on the Departments in Payroll Report.
Editing and Deleting Departments
You can manage your departments by going to Settings > Company Settings > Manage Departments.
You may edit a department name by clicking the Edit icon in the row. Change the name and click Save. Any prior transactions that used this department will be updated with the new name.
You may delete a department you no longer use by clicking the trashcan icon at the end of the row. Note that any department used in payroll may not be deleted.
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