Back Pay Processing

Backpay most often happens when the rate of pay is changed with retrospective effect.  It is then necessary to reprocess in the current period the value of the change for the affected periods of the payroll.

There are two approaches that can be adopted when using the Backpay Module. The one is to show the breakdown of the backpay into it component parts.  This involves using a separate Transaction Codes, of the same Category, for each component of the backpay.  The second method is to ignore the detail and and show the net effect of the backpay as a single amount.

There may be instances where you would prefer not to use the Backpay module, but would rate calculate the amounts manually, or on spreadsheet, and then transfer the value as an amount into the payroll for each employee.

For more information about how to use the backpay module or to process backpay manually see this link.

It should be noted that the backpay module works in a single currency environment.  In a multi-currency environment it would necessary to process the backpay amount into a Transaction Code manually.