Use these fields to create an earnings code record.
1. Earnings Code
Specify the earnings code (up to 4 characters).
2. Description
Specify the description of this code (up to 15 characters).
3. Hourly
Specify either Y or N to indicate if wages paid in this category depend on the number of hours worked.
4. Premium Earnings
Specify N or Y to indicate if this earnings category uses earnings calculations other than straight time (for example, time-and-a-half or double time). This field is used in conjunction with the hours multiplier field.
5. Fringe Benefit
Specify N or Y to indicate whether the earnings for this code is included as a fringe benefit on the W-2. If Y is entered, the amount for this earnings code prints in the Fringe Benefits box on the W-2.
6. Matching Deduction
Specify N or Y to indicate whether the earnings code has a matching deduction. This is used when a deduction must also show as earnings for taxable income on the W-2. If Y is entered, you must set up the same 4-character deduction code. When setting up employee pay cycle data information, enter the deduction but leave the earnings blank. The system adds the deduction amount to the earnings code. Ultimately, the earnings and deduction amounts total zero, however, the deduction is taxable earnings.
7. Maximum Hours Tracking
This feature is only used with hourly earnings codes. Specify either N or Y to indicate if the maximum hours tracking feature is utilized for this earnings code. If N is entered, this feature is eliminated for the earnings code. The maximum hours tracking feature allows you to specify the number of hours available yearly for an employee (for example, vacation time, sick time, etc.) through the Employee Maximum Hours F/M program. An Employee Maximum Hours Report prints the yearly maximum hours, hours used year-to-date and the available hours. The Earnings Entry program flashes a message if the employee exceeds the maximum hours for an earnings code.
8. Hours Multiplier
This number is used to determine wages for hours worked in this category. This entry can be any number up to 9.999. For example, double time has a multiplier of 2. Time-and-a-half has 1.5.
9. Payroll Item
Specify Y or N to indicate whether Earnings Code is to be considered a payroll item. Payroll items are reported on form 941 and non-payroll items are reported on form 945.