Guide to approving payroll

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27 March 2023

What to look for when checking entry requests and approving payroll

post : Payroll

It is really important that you check your payroll thoroughly before submitting the entry request or making final approval.

ENTRY REQUESTS

When you receive your entry request, you will be able to see the permanent changes that you have communicated to the payroll team. It is important that you ensure that these have all been made.

New joiners

When you have new employees joining payroll, please check:

  • Personal details – e.g. name, NI number have been set up correctly
  • Start date
  • Monthly gross salary
  • Pro-rata calculations – new joiners who start mid-month will have their pay calculated on a 260 working day per year basis. Please see the example at the end of this article.
  • Auto-enrolment – if your company postpones enrolment then ensure the new employee has pension contributions deducted in the correct month following the start date
  • Tax code – this is important if, for example, your new employee has a second job

Leavers

When one of your employees is leaving payroll, please check:

  • Leave date
  • Pro-rata calculations – employees who leave mid-month will have their pay calculated on a 260 working day per year basis. Please see the example at the end of this article.
  • Holiday pay – leavers are entitled to be paid any untaken holiday as of their leave date. Again this is calculated on a 260 working day per year basis.

Salary changes

If your employee has had a change in salary, please check:

  • Monthly gross salary
  • Pro-rata calculations – employees who have mid-month salary changes will have their pay calculated on a 260 working day per year basis. Please see the example at the end of this article.

Hourly/Daily Rate Pay

Please check both the employee hours and the rate of pay.

Ad-hoc Additions and Deductions

These can be either one-off or monthly and can include:

  • Bonuses and Commissions
  • Expense reimbursement
  • Holiday pay
  • Loan
  • Salary sacrifice

Please check these thoroughly. Also, please check that they have not been carried forward from the previous month if these were intended to be one-off payments.

Pension changes

Any changes to pension contributions are easier to check in the BrightPay Entry Request rather than the Approval. The % contributions are listed here. Please check:

  • Pension contribution percentages or amounts
  • Employees have been auto enrolled in the correct month in line with your company rules on postponement.
  • Where employees are on maternity leave, that their pension contributions are being paid in line with your company policies as outlined in their employment contracts.

Statutory payments

Please check any statutory payments (Statutory Sick Pay, Statutory Maternity Pay, Statutory Paternity Pay etc) have been made in line with your company policies as outlined in your employment contracts.

APPROVAL REQUESTS

At this stage, you will have a second chance to ensure all amendments have been made. The simplest way of doing this would be to click on any of your employees where changes have been made and run your eye over their payslip.

PRO-RATA CALCULATION – EXAMPLE

A full-time employee, with a yearly salary of £48,000, has a leave date of 24th March 2023 and is owed 3 days of unused holiday.

There are 23 working days in March 2023. This employee is employed for 18 of these:
48,000/260 * 18 = £3,323.08

They are also entitled to 3 days of unused holiday:
48,000/260 * 3 = £553.85

Therefore, their total gross salary will be 3,323.08 + 553.85 = £3,876.93

The information available on this page is of a general nature and is not intended to provide specific advice to any individuals or entities. We work hard to ensure this information is accurate at the time of publishing, although there is no guarantee that such information is accurate at the time you read this. We recommend individuals and companies seek professional advice on their circumstances and matters.