Pro rata

Pro rata


Introduced in Flexipay 2.55 is an update and an expansion to the Pro Rata functionality. Pro rata allows salaried employees to be paid portions of their normal salary in situations where they do not work their normal working pattern. This can be useful for a number of reasons:

·         An Employee has joined or left the Company part-way through a Pay period

·         An Employee has received statutory payments during a Pay period

·         An Employee has a pension that starts part way through a Pay period

·         An Employee has received a pay rise part-way through a Pay period

·         An Employee that has a rostered pattern with different length days (e.g. half a day every other Friday) can use the new Daily hours record to Pro rata their salary

The Daily hours record is a new piece of functionality that should be used when your Employee(s) work a variable shift pattern as above, or are paid based on Rates (i.e. by the hour, by the day, or per piece), and need a mid-period Pay rise for one or more of their Rates. Normally, the Daily hours record would not be used in any other circumstances.

Note: Pensions now also have the option to allow Pro rata functionality with new starters and leavers

Pro rata pay group settings

To reflect this change in functionality, Pro rata options in the Maintain pay groups window are now in the Pro-rata calculation tab in the Modify payroll options window:


 Additionally, a new option has been added to the daily rate calculation: Count daily hours. If selected, Flexipay will use the hours or part days from the Daily hours records feature to calculate the pro-rata payments, rather than a pattern of fixed-length days. Selecting this preference means that Flexipay will need the Employee's rostered days in the Daily hours record screen. To achieve this you would enter a combination of worked hours or days (e.g. Part period hours) as well as the normal hours for that period (e.g. Full period hours).

 You should decide if your payroll requires the granularity offered by Count daily hours, or whether one of the pre-existing options will work for you. In most cases, the latter will be appropriate. The Daily hours record feature below should only be used in situations with variable hourly or daily working patterns, e.g. working a half day every other Friday.

 The option to use a standard 260 day year has been separated from these options to allow its use across different features in Flexipay – you can now specify if it Counts the days/hours in the month or Uses a standard length month (e.g. the 260 day year).

 There is also a new check-box to allow you to prevent a Pro-rata adjustment from increasing a payment above their normal rate or salary. To enable this, tick Limit each result to its full-period value. This typically occurs in months that are longer than the standard length.

 There is a new option for Pay groups that specifies whether this Pay group uses hours or days in the Daily recordUse of daily hours for salary. Using Hours may be more useful for situations where worked hours vary from pay period to pay period. For the purposes of this documentation, the examples will use Use days from daily hours records.

 As a reminder, in the Pro-rata calculation tab, you can also designate default values for Employees' annual and period worked days/hours. These can be overridden at the Employee level, but defaults is useful when most Employees will share the same values.

 Additionally, if you intend to use mid-period Pay rises for your Employees paid using Rates of pay, there is also an additional setting in the Miscellaneous tab labelled Pay from daily hours. This checkbox must be ticked (or overridden for individual Employees) in order to calculate their pay using the Daily hours record:



New employee fields

To support the changes to Pay group settings, some new Employee fields have been added in this version of Flexipay that allow the Pay group settings to be overridden for an Employee:


·         'Use daily hours list'  If Y automatically copy hours from daily hours list

o    'G'      Use pay group setting

o    'Y'       Pay from daily hours

o    'N'      Do not pay from daily hours

·         'Pro-rata calc. type'  

o    'G'      Use pay group setting

o    'M'      Manual entry

o    'F'       Count all days

o    'W'      Count Mondays to Fridays

o    'Q'      Count SSP qualifying days

o    'H'      Count daily hours

·         'Std. pro-rata period'

o    'G'      Use pay group setting

o    'Y'       Use a standard number of days or hours for the full pay period

o   'N'      Count the days/hours for a full pay period

Statutory payments Pro-rata

The Pay group can be set so that the Pro rata calculation automatically excludes periods where statutory payments affect the Employee. SMP/SPP/SAP etc. can be automatically taken off the pro-rata worked time. For example, Flexipay would take out days from the start of a maternity pay period to the end of the pay period or to the SMP stop date if it stops before the end of the pay period.

To enable this, tick the new Pro-rata salary against SMP, SPP etc. setting in the Miscellaneous tab of the Payroll group settings:


 Note: The Pro rata calculation will only be done for Employees' whose Statutory payments are not offset to gross.

 If you require this to take into account that your Employees work variable length days, then the Daily hours record should be used – any rostered values in the Daily hours record will be ignored if they overlap with Statutory payments.

Pension Pro-rata

Pensions now have an option to be subject to pro-rata rules when an Employee is starting or leaving part-way through a pay period, provided that their contribution is at a flat rate rather than a percentage of pay. Also, not that this only applies to pensions that are not auto-enrolled, as they are already controlled by the auto-enrolment regulations.

When adding or modifying a Pension, a new option is available on the Misc. tab, labelled Pro rata the amount using start and leave dates:


 When this checkbox is ticked, any Employee that starts or leaves during a Pay period will pay a reduced flat rate based on their start or leave date. Unlike other Pro rata rules, this is always based upon the Count all days setting, regardless of the Pay group or Employee settings.

For instructions on how to pro rata mid period pay rises, click here for the relevant article.

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