Overview

Deductions are a part of day-to-day payroll processing. They can be for a range of things including IRD notices, Ministry of Justice Court Fines, personal debts, repaying overpayments or social club fees. The terms of these deductions can change, existing ones can become redundant or the amounts owed can vary.
The type of deduction used is very important so it's essential the component is set up correctly with the right attributes. Because of this, it's best practice to provide as much detail about the deduction as possible.
Clients will send through details of deductions either through online modifications which can be done in www.easipaylive.co.nz or www.datacomdirectaccess.co.nz, via the employee modifications section of an Excel timesheet or directly to the consultant via email.

The main types of deductions available are:

• Child Support
• Ministry of Justice Court Fines
• Work and Income debts
• IRD debts
• Student Loan debts
• Social Club deductions
• Union deductions
• Personal debts (e.g. a personal loan company like Moola)
• Repayments (When the employee has been overpaid through payroll and this needs to be recovered)

Client Responsibilities

The Client will need to provide answers to the following questions:

• Which employee is the deduction for? (best to provide their employee code)
• What is the deduction for?
• Has this type of deduction been used before/does it currently exist in your company?
• What is the start date or period end that the deductions should start from?
• Is the deduction a one-off or an ongoing deduction?
• What is the total amount of the deduction?
• How much should be deducted each pay period?
• Is the deduction going to Direct Credit anywhere and if so, what are the bank account details and references to use?
• Is the deduction replacing an existing deduction or is it a new one?
• Should the employee have a certain amount of their wage protected? i.e. If the employee's wages drop below a certain percentage or amount, then the deduction won't be taken. A common example is for protected net earnings in relation to child support.

EasiPay Responsibilities

Your consultant will (assuming accurate answers provided by the Client under the previous section):

• Make sure the deduction type required exists and if not, create a new component (details for this will be detailed in another user guide)
• Work out the best way of adding the deduction for the employee. If it is a common deduction among employees e.g. social club or union deduction, this can usually be done via an employee group. If the deduction is unique to the employee then it should be added through the pay components section for recurring deductions, or straight into the pay packet for a one-off deduction.
• If the deduction is to replace an existing one, the consultant will end date the previous deduction as at the end of the last Pay Period and create the updated deduction from the start of the current pay period.
• Once the deduction is set up, the consultant will check that it is working properly. It is particularly important to check the Direct Credit Schedule if a deduction is to direct credit to a bank account.

Additional Notes

• If the debt is a government issued debt (Child Support, MOJ Court Fines, IRD notices etc), then sending the notice directly to your payroll consultant is recommended to ensure it is set up correctly.