Businesses using US Payroll have the flexibility to retrospectively configure compensation, commonly known as backdated compensation or retro pay.
These adjustments are typically associated with two main scenarios:
In situations where a mistake was made in inputting compensation, a prompt adjustment is necessary.
Backdated Compensation Change:
This scenario not only entails rectifying current compensation but also involves communicating the retroactive date to the Payroll Manager.
✅ Step 1 - Edit the Compensation
If your country is eligible you'll see the Compensation section under the Employee Profile.
Navigate to People, then choose the Employee for whom you wish to retroactively adjust the salary, and then access the Compensation section by scrolling down.
✅ Step 2 - Select the Effective Date
Select and edit the following as you wish:
- Effective date
- Gross salary
If you are backdating the salary compensation make sure to select a date in the past and overwrite the new salary.
✅ Step 3 - Effective Date in the Current or Past Payroll Cycles
If the selected date is within the current or past payroll cycles, any payroll adjustments will be applied in the next available cycle. A yellow box will pop up and explain how this is going to work
Proceed by clicking Next and reviewing the changes before selecting Update.
✅ Step 4 - Effective Date in Future Payroll Cycles
When adjusting salary compensation for a future payroll cycle, an alert will be displayed in the Compensation section of the Employee profile, providing information on the effective date of the upcoming change.