Updating Wages for Employees in Xero

Learn how to update employee wages in Xero

It is very important that wages for employees are calculated and paid correctly. This article provides information on how to update wages, both on a temporary and a permanent basis.

Table of Contents

Updating Wages for a Specific Payrun

Updating Wages for Future Payruns

Updating Wages for a Specific Payrun

Sometimes an employee will be paid a different rate for a particular pay period (or part of the pay period). For example, the employee may have some hours of increased duties, so would be entitled to a different rate for those hours.

Note that these instructions will only have an impact for the current payslip. If you need to update an employees details so all future payruns are updated, use the instructions in the next section.

To update the rate of pay for an employee for a specific payrun, you need to do the following:

• In the Payroll menu, select Pay Employees.
• Click + Add Pay Run and select the pay period that you will be working on. Usually this is the next payrun in the series.
• Select the employee that requires their pay details to be updated by clicking on the row that contains their name.
• If all of the hours the employee works are to be at the higher rate, adjust the hourly rate as appropriate. Xero will update the superannuation and PAYG withholding calculations as required.
• If an employee has different hourly rates, you can click+ Add Earnings Line to add another line to calcuate the different rates as appropriate.
• Once you have checked that the number of hours at each rate has been entered correctly, click Save to store the information, then close, or click Save & Next to review the next employee.

Updating Wages for Future Payruns

If you need to change the pay details for an employee for all future (or the forseeable future) you will likely want to update their pay template.

This would typically be done when an employee is given a payrise, or is performing higher duties for an extended period (more than a few pay runs).

To update the rate of pay in an employees pay template, you need to do the following:

• In the Payroll menu, select Employees.
• Select the employee that requires their pay details to be updated by clicking on the row that contains their name.
• Click on Pay Template to bring up their default pay information.
• Update the Annual Salary or Hourly Rate as appropriate.
• Click Save to store the updated information.

Once you have completed the above steps, you should be able to process the next pay run with the updated pay information.

Note that if the payroll change occured part way through a pay period, you will have to make manual adjustments to that pay run using the steps in the first section.