An earnings certificate is a summary of an employee's earnings, tax and deductions over the tax year. Earnings certificates can be issued to employees:
- at the end of each tax year; or
- at the end of an employee's employment.
To clarify, employers are not legally obligated to issue earnings certificates to employees. Rather, it is at the discretion of the employer.
The Reports > Payroll > Earnings Certificate screen allows users to generate and publish earnings certificates, either in bulk or individually. This article will detail the best practice process to publish the earnings certificates.
Step 1: Ensure pay runs are finalised
When filtering the report by the applicable tax year, check there is no warning relating to unfinalised pay runs:
If there is, you must ensure that you finalise all pay runs relating to that tax year prior to generating any earnings certificates. The reason for this is that earnings and all other figures reported may not be accurate for each employee as unfinalised pay run earnings are not included in the certificates.
Step 2: Reconcile payroll data
Prior to publishing earnings certificates, it is recommended that you reconcile the payroll data showing in the earnings certificates with that of the Detailed Activity Report. This will ensure that the data provided to employees is 100% correct.
You can export an excel version of the earnings certificate report by clicking on the "Export" button in the Earnings Certificate screen. This will display the data based on your report filters. Then, export the Detailed Activity Report (DAR) using the same reporting period. Grouping the DAR by 'Employee Default Location' will assist in the reconciliation as there will only be one row per employee. You can then compare the total amounts for each component between the two reports.
Step 3: Generate Earnings Certificates
Prior to publishing earnings certificates you must first generate them. By default, the system will not filter any pay schedule, location or employing entity (employing entities are only relevant for businesses using the Employing Entity settings). This means that you can bulk generate earnings certificates for all employees. You can, however, choose to generate certificates in chunks at a time. To do this, filter accordingly using the pay schedule, location and/or employing entity filters.
Once you have chosen your filters, click on the "Generate Earnings Certificates" button. This will display all the data on the screen for your review.
You can choose to export the data in excel and/or produce the earnings certificates in PDF without having to first click on the "Generate Earnings Certificates" button. Exporting via PDF will provide the user with each employee earnings certificate in one document.
Take note of the following:
- All employees that have not been terminated prior to the tax year will appear in the report - even if there were no earnings paid in the tax year;
- We display both gross earnings and taxable earnings in the report, however, only taxable earnings are displayed in the published earnings certificate.
Step 4: Publish Earnings Certificates
Once you have completed the above steps and are confident all the data is correct, you can now publish the earnings certificates. Publishing the certificates makes them available in the employee file (via the Earnings Certificates screen) as an employer record and in the employee portal for employees to access and/or download.
You can bulk publish the earnings certificates displayed on screen by clicking on the "Actions" > "Publish xx Earnings Certificates" button:
Alternatively, you may want to publish employee certificates individually, for eg an employee has left your employment within the tax year and so want to issue them a certificate now rather than at the end of the tax year. To do this, click on the "Actions" button located on the last column of that employee's row and then click on "Publish". The "Download" function will generate a PDF version of the earnings certificate just for that employee.
Any changes to pay runs for the tax year and/or employee details, such as address, made subsequent to publishing the earnings certificates will be reflected automatically in the earnings certificates.
Step 4: Notify employees
Sending earnings certificate notifications is a really simple process. Once you have completed step 3 above, you can bulk notify employees displayed on screen by clicking on the "Actions" > "Notify all employees" button.
Alternatively, you may want to notify an employee certificate individually, to do this, click on the "Actions" button located on the last column of that employee's row and then click on "Notify".
(Example of Email earnings certificate notification to an employee)
Downloading Earnings Certificates in Employee File & Employee Portal
Once earnings certificates have been published, a record will be attached against each employee file. To access an earnings certificate for an employee, go to the employee's file and click on the "Earnings Certificates" menu.
From this screen, you will be able to download the certificate for each relevant tax year. To do this, click on the tax year and the certificate will automatically download.
Regarding the employee portal, employees will be able to access their certificate by navigating to "Documents" > "Earnings Certificates". They can then download the certificate for the relevant tax year by clicking on the tax year.