Pay Categories - Creating & Managing

Pay Categories are used to define the rates that employees are paid. Setting up your pay categories will help simplify the management of employee pay rates by:

  • Automatically calculating linked rates through loading and penalty rate multipliers;
  • Defining what is exempt from KiwiSaver, PAYE, GST and ACC Levy;
  • Configuring leave accrual;
  • Excluding certain pay components from being calculated as part of Average Weekly Earnings and Ordinary Weekly Pay.

To access the pay categories page, go to 'Payroll settings > Pay categories'. The default set up for a new business includes several already configured Pay Categories. You will also notice that pay categories labelled 'SYSTEM' cannot be edited at all:


This is intentional to ensure the system calculates the pay categories and associated components in a specific manner.

All other default pay categories can be either deleted or edited to match your business needs.

Creating a Pay Category

You can create a pay category by following these steps:

  1. Log into your payroll platform.
  2. Click the  Business menu.
  3. Click the Payroll Settings submenu.
  4. Under Pay Run Settings, click Pay Categories.
  5. Click the Add button.

    Helpful Hint

    When you create a new business, you can select from the common pay categories we have on the platform. However, you can still create new ones that match your business needs.
    screenshot of the pay categories screen, highlighting the add button
  6. Type the name of the new pay category in the Pay category name field.
  7. Tick the Is Fixed checkbox if this is a fixed pay category.


    Fixed pay categories cannot be changed to hourly/annually/daily/monthly after it has been created. If that is required, you​ will need to create a new pay category.

    If the pay category is for a per-unit payment, for example a vehicle allowance or bonus, click this checkbox. You will also notice when a pay category is set as "Fixed," you will not be able to select the "Accrues Leave" setting in the next step.

  8. Click the Save button.
    screenshot of the new pay category pop up, highlighting the save button
  9. Fields in this category include:

    • Units - If the pay category is a fixed pay category, this field will be locked and not editable. For all other pay categories, if the pay category is processed on a per-hour basis, select "Hourly". If the pay category is to be used as a primary pay category for employees earning an annual salary, select "Annually". You can also select "Daily" or "Monthly".
    • Exclude from Average Weekly Earnings - Ticking this checkbox means that any earnings paid under the pay category will not be calculated towards the employee's Average Weekly Earnings, as part of annual holiday calculations.
    • Exclude from Ordinary Weekly Pay - Ticking this checkbox means that any earnings paid under the pay category will not be calculated towards the employee's Ordinary Weekly Pay, as part of annual holiday calculations.
    • PAYE Exempt - Tick this checkbox if the earnings are tax free.
    • KiwiSaver Exempt - Tick this checkbox if the earnings are KiwiSaver exempt.
    • GST Exempt (option only available if contractor management function enabled) -Tick this checkbox if the earnings are GST exempt. Only applicable for independent contractors who have registered for GST(Refer to Advanced Settings for more information on enabling the contractor management function).
    • ACC Levy Exempt - Tick this checkbox if the earnings are ACC levy exempt.
    • External Id: A value is only required here if you are using an external system to capture timesheets or earnings lines and so need to map the code used from such external system. If an external id is used that has been used before you won't be able to save it if the 'unique external Id' setting is switched on. This setting is located on the Payroll settings > Advanced settings page. See here for more information. 
    • Accrues Leave - If employees are accruing any type of leave based on the "hours per hour worked" accrual method, this setting will determine whether any leave hours will accrue when the employee is paid against the pay category in a pay run. If the checkbox is NOT ticked, employees will not accrue leave on an hours worked/paid using this pay category.
    • Rate Precision - Option to set rate at between 0 and 6 decimal places. If adding additional earnings lines for an employee (configured in the employee's Pay Rates screen), the rate can be specified up to 6 decimal places regardless of the pay category setting. Please note however in the pay run, rates will only calculate up to a maximum of 5 decimal places.
    • Rate Loading - If you want to pay an all uploading for an employee on the base rate of pay, you can configure that in this setting. For example, if an agreement has been reached that an employee will work a certain number of overtime hours and will be paid an additional 10% on their agreed base rate for all hours worked against that pay category, you can enter "10" in that field.
    • Hide units on pay slip - When paying employees, there may be pay categories where you do not require the number of units and rate per unit to be displayed on the pay slip. Examples include paying a commission or bonus, or the primary pay category for salaried staff. Even though the units will still be displayed in the pay run, ticking this checkbox means they won't appear on the pay slip. For eg, if you have ticked the setting for the 'Salary' pay category, the pay run will still appear as follows:

      The employee's pay slip, however, will appear as follows: 

  10. Once you have completed the details of the pay category, click the Save button on the bottom left of the pay category box.

Manage Pay Categories

In addition to the base value pay category, you can create linked categories.


You will not be able to add linked pay categories to ‘Fixed’ pay categories.


When reviewing an employee's Pay Rates page, you will notice that linked pay categories are automatically calculated. In fact, they cannot be overridden by a user. If an employee's pay rate increased the rates attached to linked pay categories will also automatically calculate, eliminating and manual data entry or calculation of any penalty rates.


Editing Pay Categories

To edit a pay category, click on the pay category name to expand the settings. Make the necessary changes and then click on "Save".

Note: If a pay category has been used in a pay run, you are NOT able to change the PAYE setting. Rather, you will need to create a new pay category and apply the updated PAYE setting in that new category. 

Additionally, as stated previously no "SYSTEM" configured pay categories can be edited. 

Deleting Pay Categories

To delete a pay category, hover your mouse over the pay category name where you will then see a red cross icon on the right hand side of the pay category. 


Click on the "x" icon where a confirm popup dialog will then appear. If you click on "Delete" the pay category will be removed from the platform.  

Note: If a pay category has been used in a pay run, you are NOT able to delete it. Additionally, no "SYSTEM" configured pay categories can be deleted.

Restoring a pay category

You are able to restore a pay category by going to Payroll settings > Restore deleted items, and selecting 'Pay category' from the drop down box. A list of all deleted pay categories will appear and you can click the 'Restore' option against the pay category that you are wanting to reinstate. 

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