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Chapter 1: Getting start with Payroll module

1.1 Payroll Quick Start

Overview

Payroll is used to manage employee salaries, statutory deductions, leave records, claims, allowances, and payslip generation.

Objectives

After completing this chapter, you will be able to:

Task Result
Configure Payroll Ready
Register Employee Ready
Setup Payroll Component Ready
Process Salary Ready
Generate Payslip Ready

Payroll Setup Workflow

Core HR Setup
        │
        ▼
Create Payroll Components
        │
        ▼
Register Employee
        │
        ▼
Assign Salary Structure
        │
        ▼
Configure Statutory Information
        │
        ▼
Setup Account Posting
        │
        ▼
Assign Leave Approver
        │
        ▼
Ready for Payroll Processing


1.2 Payroll Quick Start

Purpose

The Quick Start Guide provides the minimum setup required before payroll processing.

Checklist

Step Status
HR Profile Setup ✓
Payroll Component ✓
Employee Registration ✓
Statutory Setup ✓
GL Account Posting ✓
Leave Approval Setup ✓

Notes

Complete every setup before processing payroll to avoid calculation errors.

1.3 Setup Statutory Data

Purpose

Configure government-required payroll deductions.

Examples

Component Description
EPF Employee Provident Fund
SOCSO Social Security
EIS Employment Insurance
PCB Monthly Tax Deduction

Exxample: Compensation Management

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Workflow

Payroll Module
    ↓
Payroll Component
    ↓
Compensation
    ↓
+ Create
    ↓
Enter Contribution Table
    ↓
Save


1.4 Setup Payroll Components

Purpose

Payroll Components define how employee salaries are calculated.

1. Position

Purpose

ExampleThe ComponentsPosition module manages the list of employee job positions within the organization.

Functions
    Create new job positions Edit existing positions Assign positions to employees Organize payroll by job role
    Examples
      Manager Supervisor Executive Technician Clerk

      2. Department

      Purpose

      The Department module manages the organizational departments used throughout the payroll system.

      Functions
        Create departments Update department information Assign employees to departments Generate department-based payroll reports
        Examples
          Human Resources Finance Sales Marketing Production IT

          3. Compensation

          Purpose

          The Compensation module defines employee salary structures and recurring earnings.

          Functions
            Configure basic salary Set salary frequency Manage fixed compensation Support payroll calculation
            Examples
              Basic Salary Fixed Monthly Salary Daily Wage Hourly Rate

              4. Allowance

              Purpose

              The Allowance module manages additional payments provided to employees beyond their basic salary.

              Functions
                Create allowance types Configure allowance amount Assign allowances to employees Include allowances in payroll processing
                Common Allowances
                  Transport Allowance Meal Allowance Housing Allowance Phone Allowance Travel Allowance

                  5. Deduction

                  Purpose

                  The Deduction module manages salary deductions applied during payroll calculation.

                  Functions
                    Create deduction types Configure deduction rules Apply recurring deductions Include statutory deductions
                    Common Deductions
                      Income Tax (PCB) EPF (KWSP) SOCSO (PERKESO) EIS Loan Repayment Salary Advance

                      6. Overtime

                      Purpose

                      The Overtime module manages overtime payment settings for employees.

                      Functions
                        Configure overtime rates Define overtime categories Calculate overtime earnings Include overtime in payroll
                        Examples
                          Normal Working Day Rest Day Public Holiday Weekend Overtime

                          7. Commission

                          Purpose

                          The Commission module manages commission-based earnings for eligible employees.

                          Functions
                            Configure commission schemes Assign commission to employees Calculate commission payments Include commissions in payroll
                            Examples
                              Sales Commission Performance Commission Incentive Bonus

                              8. Claim

                              Purpose

                              The Claim module manages employee reimbursement categories used in the Claim Approval process.

                              Functions
                                Create claim categories Configure claim limits Define reimbursement rules Support employee claim submissions
                                Examples
                                  Travel Medical Accommodation Meal Transportation Miscellaneous

                                  9. Leave Setup

                                  Purpose

                                  The Leave Setup module configures company leave policies and entitlement rules.

                                  Functions
                                    Configure leave entitlement Define leave eligibility Set leave accrual rules Configure carry-forward policies
                                    Examples
                                      Annual Leave Entitlement Sick Leave Entitlement Carry Forward Limit Leave Expiry Rules

                                      10. Leave Type

                                      Purpose

                                      The Leave Type module defines the different categories of leave available to employees.

                                      Functions
                                        Create leave types Configure leave settings Assign leave eligibility Link leave types to Leave Approval
                                        Common Leave Types
                                          Annual Leave Sick Leave Emergency Leave Maternity Leave Paternity Leave Unpaid Leave Compassionate Leave

                                          11. Account Posting

                                          Purpose

                                          The Account Posting module maps payroll components to the company's accounting ledger. It ensures payroll transactions are posted to the correct General Ledger (GL) accounts during payroll processing.

                                          Functions
                                            Configure GL account mapping Assign debit and credit accounts Link payroll components with accounting codes Support automatic accounting postings
                                            Common Posting Accounts
                                            TypePayroll Component Example GL Account
                                            Basic Salary RM3000Salary Expense
                                            Allowance TransportAllowance Expense
                                            Overtime OTOvertime RateExpense
                                            Commission Commission Expense EPF EPF Payable SOCSO SOCSO Payable PCB Tax Payable Bonus AnnualBonus Bonus Deduction Loan Claim Travel ClaimExpense

                                            Component Formula

                                            Gross Salary
= Basic
+ Allowance
+ Overtime
+ Bonus


                                            Net Salary
= Gross Salary
− EPF
− SOCSO
− PCB
− Other Deduction


                                            1.5 Setup HR Profile (Core Module)

                                            Purpose

                                            Before payroll can be used, every employee must have an HR Profile.

                                            Required Information

                                            Field Required
                                            Employee Code YesNo
                                            Name Yes
                                            DepartmentUsername Yes
                                            PositionEmail Yes
                                            Join Date

                                            Phone

                                            No

                                            Position

                                            No

                                            Role

                                            Yes Default  access branch Yes

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                                            Workflow

                                            Core
   ↓
HRUser ↓
EmployeeManagement
   ↓
Create Employee


                                            1.6 Register Employee

                                            Purpose

                                            Register employees into the payroll system.

                                            Required Information

                                            CategoryField InformationRequired
                                            PersonalEmployee Name Name, IC, GenderYes
                                            EmploymentBirthday Department, PositionYes
                                            PayrollRetirement date Salary
                                            Bank Bank Account Statutory EPF, SOCSO, PCBYes

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                                            Users can configure the employee's payroll information

                                            image.png

                                            Workflow

                                            Payroll
   ↓
Employee
   ↓
Create

                                            1.7 Setup Account Posting

                                            Purpose

                                            Exampleimage.png

                                            Payroll Item GL Account Salary Expense Salary Expense EPF Payable EPF Liability SOCSO Payable SOCSO Liability Bank Payment Cash at Bank

                                            Posting Workflow

                                            Payroll
      ↓
GeneratePayroll PayrollCOmponent
      ↓
PostAccount Journal
      ↓
Accounting LedgerPosting


                                            1.8 Setup Superior for Leave & Claim Approval

                                            Purpose

                                            Assign approvers for leave and claims.

                                            Approval Flow

                                            EmployeePayroll
      ↓
SubmitCalender
      ↓
Apply Leave
      ↓
ImmediateList SuperiorView
      ↓
HR
      ↓
ApprovedApprove

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