Are you transitioning an employee from a daily rate to a fixed semi-monthly or monthly salary structure, but unsure how to reflect this change in the system?
Moving a team member between different payroll frequencies requires updating both their salary details and their payroll assignment group to ensure their upcoming payslips calculate accurately.
Please note that the difference will be the source of the salary computation.
Daily Paid employees' salary is being computed based on their logs, while, Monthly/Semi-Monthly Paid employees' salary is being computed based on their Basic Salary and Days Present/Absent.
Below are the steps for transitioning from daily paid to semi-monthly paid employees:
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In Sprout HR, the Payroll Run Type under Work Information should be updated to Semi-Monthly.
- For the Salary, under Current Payroll Information, the Basic Salary and De Minimis (if applicable) should be updated to a monthly rate instead of a daily rate.
Please refer to the sample image below:
As for the Overtime, Night Differential, and Holidays, the employee will still be entitled to these items.
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For Sprout Payroll, you will be using the Normal Payroll run type instead of Part Time.
What is the difference between Monthly/Semi-Monthly Paid vs. Daily Paid employees?
The key difference lies in how salaries are computed:
- Daily Paid or Part-Time Employees: Their salary is completely driven by timekeeping. The payout is based on actual hours worked, which is pulled directly from the “Total Hours Worked” column in the Attendance Report.
See What Is the Difference Between Total Hours Worked and Total Hours in the Attendance Report? - Monthly/Semi-Monthly Paid Employees: Their base payout is fixed. The system automatically reflects the exact half-month salary for each period, while any absences, late logs, and undertime are calculated and deducted separately based on the uploaded attendance.
Read: The Difference Between Daily Paid and Monthly Paid Employees
Will there be any implications for Payroll?
If you are utilizing the Import Retro feature, please note that it cannot be used during the first payroll run when transitioning from Daily Paid to Semi-Monthly. This is because the Import Retro function only works when the payroll run type remains the same.
In this case, the payroll run type for Daily Paid employees is "Part-Time", while for Monthly or Semi-Monthly Paid employees, it is "Normal". Since the run types differ, the system will not recognize retro entries from the previous payroll type.
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