Summary
This article covers the configuration of the payment dates of government bonuses, balancing legality with practicality.
When are the bonuses meant to be paid?
The Government Bonuses are to be paid before the following dates:
- 31st March
- 30th June
- 30th September
- 23rd December
How does a payroll determine if a bonus is due?
Each payroll has a date called "include bonuses until". This will determine whether a bonus is to be paid.
For example, if a payroll has a pay date of 30th November with bonuses until 30th December, then the Statutory Bonus that is due before 23rd December will be included in the November Payroll.
This date can be adjusted during the Run Payroll Process, or best configured for a more permanent structure.
How to configure permanent settings to avoid adjusting every payroll?
In the Pay Schedule Settings, you can select the default Include Bonuses Until.
Here's what each means:
-
Before Next Pay
This will set the default include bonuses until date to the (current pay date + period length).
In the case of monthly payroll, this will be 30 days after the current pay date.
-
Pay with Period
This will set the default include bonuses until date to the period end date
-
Last day of Month
This will set the default include bonuses until date to the last day of the month.
Common Pitfalls in Period Setups
When it comes to monthly payroll, setting the Before Next Pay may sometimes cause unintended results, particularly for those who set the pay date to the last day of the period.
Due to differing month durations, if the pay date is 31st August, this will default the bonuses date to 30th September.
In such cases, it's recommended to:
- Consider moving the pay date to a fixed or earlier date (e.g. 30th of the month, penultimate day of the month)
- Consider the other include bonuses until options, to see which best fit your payroll
In addition, the current period will have to be revised in the Run Payroll Process to remove any unwanted bonuses from the current month.
What happens when updating the Pay Schedule Settings?
Current and previous payrolls will not be updated.
The pay schedule settings will only come into play for any future pay periods that are not yet opened.
Why is the Default set to "Before Next Pay"?
The bonuses are meant to be paid before their due date. This creates scenarios where companies are often at risk of breaching this timeframe:
- December bonus should be paid by 23rd December, before Christmas.
For monthly payrolls, this can be included either in an early December payroll, or as part of the November payroll.
- Non-monthly payrolls (e.g. every four weeks) will often process pay dates differing from the month end, therefore have to include the bonus in a previous payroll to avoid late payments.