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How to set up and calculate the minimum wage balance in Microsoft Dynamics GP

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This article describes how to set up and calculate the minimum wage balance in Microsoft Dynamics GP.

Applies to:   Microsoft Dynamics GP
Original KB number:   865588

More information

To set up and calculate the minimum wage balance, follow these steps:

  1. Set up a minimum wage balance pay code.

    On the Microsoft Dynamics GP menu, point to Tools > Setup > Payroll, and then select Paycode.

  2. Enter or select a pay code, and then enter a description in the Description box.

  3. In the Pay Type list, select Minimum Wage Balance.

  4. In the Pay Rate box, enter a pay rate. The pay rate is the minimum hourly rate the employee must receive.

  5. In the Pay Period list, select a pay period.

  6. In the Subject to Taxes section, select the check boxes that are required for the pay code.

  7. To save the pay code setup, select Save.

  8. Set the employee card to use minimum wage balance by taking these steps:

    1. On the Cards menu, point to Payroll, and then select Employee.
    2. In the Employee Maintenance window, select Additional Information.
    3. In the Employee Additional Information Maintenance window, select the Calculate Minimum Wage Balance check box.
    4. Select OK to save the changes.

  9. Assign the pay code to the employee by taking these steps:

    1. On the Cards menu, point to Payroll, and then select Pay Code.
    2. In the Employee Pay Code Maintenance window, select or enter the employee ID.
    3. In the Pay Code list, select Minimum Wage Balance.
    4. Select Save to save the changes.

Note

You may not create a transaction by using the minimum wage balance pay code.

Examples

For the following examples, the employee is assigned the following:

  • The Hourly pay code at a rate of $2.00.
  • The Reported Tips pay code.
  • The Minimum Wage Balance pay code at a rate of $5.50.

Note

Business Expense pay isn't included in the minimum wage balance, nor is the retroactive pay calculation.

Example 1

An employee receives a pay rate equal to minimum wage during training. The pay rate in the Hourly pay code is set to a wage of $5.50, and therefore no minimum wage balance is calculated or appears on the pay stub.

Example 2

An employee has worked 40 hours during the week. A transaction is entered for the Hourly pay code for 40 hours. The build finds that the minimum pay of $220 won't be met by using the transactions that were created. So, the employee pay stub includes the Hourly pay code at $80.00 and the minimum wage balance pay code at $140 ($220-$80). The calculated gross wages for the employee are $220.00.

Example 3

An employee has worked 40 hours during the week. The employee received $100 in tips. A transaction is entered for the Hourly pay code at 40 hours, and the Reported Tips pay code at $100.00. The build finds that the minimum pay of $220 won't be met by using the transactions that were created, and it calculates a minimum wage balance of $40. Therefore, the employee pay stub includes the Hourly pay code at $80.00, the Reported Tip pay code at $100.00, and a minimum wage balance of $40. The calculated gross wages for the employee are $120.00 ($80+$40).

Example 4

An employee has worked 40 hours during the week. The employee received $200 in tips. A transaction entry is created for the Hourly pay code at 40 hours, and the Reported Tips pay code at $200.00. The build finds that the minimum pay will be met by using the transactions that were created. Therefore, the employee pay stub includes the Hourly pay code at $80.00 and the Reported Tip pay code at $200.00. The calculated gross wages for the employee are $80.00.