Earnings Master

NAVIGATION: MAINTAIN menu  > Earnings Master

1. Enter a new Code using up to four characters, i.e., HR or SAL2
2. Enter a Description for the Code, such as Hourly or Salary 2
3. Enter a check in the appropriate boxes:
   1. Earnings Is Taxable - check if taxes should be calculated on this earning
   2. Withhold Federal - check if Federal taxes should be withheld on this earning
   3. Salary Earning Type - check if earnings will be a fixed rate and not hourly
   4. Main Hourly Code - check only for the code used as the employee's normal hourly rate
   5. Absent Code - check if the earnings will be for non-work hours such as Sick, Vacation or PTO
   6. With Pay - check only when the Absent Code is checked and the time will be paid, leave unchecked for unpaid time off
   7. Allow Code to Reduce Master Hours - check if hours entered for this earning code should reduce the hours entered during the Auto-Setup Time Card function.  For Example:  Auto-Setup entered 80 hours for HR.  Entering 8 hours of SICK will reduce HR to 72 hours.
      1. NOTE:  Once a user has manually altered the original HR 80 hours record, it will no longer be automatically reduced by other earning code entries.
   8. Use Special Percent for Federal Withholding - Earnings with this option checked will not withhold Federal Tax based on the Employee's tax settings.  Instead, the federal tax calculation will use the percent set in Payroll Settings - Spec Fed %.  The special federal percentage is used for special pays such as annual bonuses.
   9. Non-Distributable Earnings - These earnings will not be used for the distribution of benefit expenses to the general ledger but will be used in the calculation of the expense.
      1. EXAMPLE
         1. An employee has earnings to general ledger Wage Account 4100 for $200.00, to 4200 for $200.00 and using a Non-Distributable Earning code to 4500 for $100.00 which totals to $500.00.  
         2. A benefit based on dollars earned, such as Social Security @ 6.2%, will calculate the expense amount based on the total earned of $500.00 x 6.2% which equals $31.00 to be expensed.  
         3. The normal benefit calculations would distribute Benefit Expenses to the general ledger based on the original Wage Accounts used as 40% ($200), 40% ($200) and 20% ($100).  
         4. However, with the 4500 amount being Non-Distributable, the benefit distribution will be based on the $200.00 to account 4100 and $200.00 to account 4200 with a total distributable earning of $400.00.  
         5. 50% of the $31.00 will be distributed to account 4100 and 50% to 4200 based on the $400 total that was distributable.
4. Enter a Rate Factor - usually 1.  The Rate Factor is used in calculating rates during Time Card Entry.
   1. If the Earning Code being entered is not one if the four Default Earnings setup in the Employee Master, the entry will calculate the rate using the hourly rate in the employee's first Default Earning row multiplied by the rate factor entered for the earning code.
   2. If this earning code is a "straight time" hourly code, the rate factor is usually 1
   3. If the earning code is a salary code, the rate factor is usually 0.00
   4. If the earning code is for overtime or any rate based on a factor of the normal rate, then enter the multiplication factor.  For Example:  An overtime earning code may have a 1.50 rate factor.  Holiday earning codes may have a 2.00 rate factor.
   5. If the earning code is the same rate as the hourly rate, such as sick time, enter 1
5. Absentee Earning Code - If this code will be used for Time off and the Absent Code box is checked, then enter a code here.  This may or may not be the same as the Earning Code but should match a code used in the Entitlement Master's Accumulation Code as the "Earning Code".  This allows more than one earning code to be linked to an Entitlement.  This field may be left blank if your company does not use the entitlement system.
6. GL Compression Code - The payroll system normally creates one entry per employee for each general ledger account number used for wage expenses. Using the GL Compress Code field, the system can separate entries for each Earning Code.  Compression codes may be entered for some earning codes and not others.  The G/L Compression Code field is also used with Department Mode 2 to enter a consistent Wage Code. (NOTE: please contact the Horizon Help desk before changing modes in Payroll Settings)
   1. Enter a GL Compression Code to have all Earning Codes with matching GL Compression Codes combined based on the general ledger account.  The GL Memo field will include the compression code as well as the employee's name.
      1. If every Earning Code has a unique GL Compression Code, such as earning code OT with a compression code of OT, then every Earning Code will be listed separately in the General Ledger by general ledger account number. For Example:

         ACCOUNT	DEBIT	DATE	SOURCE	MEMO
         4110	200.00	10/31/21	PR	Eppley, Mark (SAL)
         4120	300.00	10/31/21	PR	Eppley, Mark (SAL)

   2. Earning Codes with no GL Compression Code will have one entry per employee per GL Account. The GL Memo field will only show the employee's name. For Example:

      ACCOUNT	DEBIT	DATE	SOURCE	MEMO
      4110	200.00	10/31/21	PR	Eppley, Mark
      4120	300.00	10/31/21	PR	Eppley, Mark

   3. W2 Special Box Code - Leave blank, this feature no longer functions
7. Earning High Hour Alert - This feature can be set to show a warning note on the Time Card Register when hours entered for the code are over a set limit.  For each Payroll frequency enter the highest allowable hours.  
   1. FOR EXAMPLE:  Set the HR Earning Code High Biweekly at 80.  If the Time Card Register is run with the Print High Individual Earnings Warnings box checked, then any employee with more than 80 hours entered for HR will print a warning.  NOTE:  This option only works correctly for one earning code. Setting multiple codes with a High Alert may prevent warnings from printing.
8. Specialized Options - These options are for reporting and payment of tip income for service staff.
   1. Auto Deduction Code - enter a Deduction Code to withhold the same amount for the employee as the earnings entered for this Earning Code.
   2. Reported Tips Earning Code  - check this box to indicate that the earnings are Tips.
   3. Tip Adjustment Code: - check the box to indicate this is the Tip Adjustment.  This earning will calculate if the employee has not reached the Minimum Wage amount for hours worked after including tips.
9. Click SAVE

See Earnings Codes List

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