Pay period groups (PPGs) are used to define a payment schedule. The PPG itself is a group of pay periods that might be used by a single employee position. For example, a teacher who is paid on a semi-monthly basis throughout an entire year would be in a PPG containing 24 pay periods.
Pay period groups serve several roles:
1. Predict when an employee should be paid
Whenever you create a payroll run, you must select which pay period groups are being paid on that date. For example, imagine that semi-monthly employees are paid on the 15th and the 31st, but monthly employees are paid only on the 31st. In this case, the Oct 15 payroll will only have the semi-monthly PPG added. Employee positions that belong to the monthly PPG will not be eligible to be paid on that payroll run. However, the Oct 31 payroll will contain both the monthly and semi-monthly PPGs, so anyone may be paid.
2. Divide salary accurately
Salary is entered as a yearly dollar amount on an employee position. The amount on each payroll run is determined by dividing that yearly figure by the number of pay periods in the pay period group. This is why teachers who are paid over the summer need a different PPG than teachers who are only paid during the school year.
3. Define pay frequency for tax withholding
Federal and state tax withholding formulas both look at the pay frequency (number of pay periods) of an employee to determine how much tax should be withheld. If pay frequency is too high, it can push employees into a higher tax bracket and result in overwithholding.
For salaried employees, choosing the right pay period group is critical. Salary is generally calculated by taking a yearly amount and dividing it by the number of pay periods in the position’s PPG.
Some non-salaried wages may be more complicated because of irregular pay schedules. In that case, the general rule of thumb is to choose pay periods that encompass the first possible pay period and the last possible pay period. Look at the examples below for some specific scenarios that might crop up.
To create a pay period group:
- Go to Financials Main > Payroll > Pay Period Groups
- Enter a Description that makes it clear when this group should be used.
- E.g. 24 Pays, Certified Staff, Hourly, 10-Month Pay
Once PPGs have been created, every employee position needs to be assigned to one.
- Go to Financials Main > Payroll > Employee Payroll Groups
- Mass Edit Employees
- Choose a Payroll Group
- Select employees from the Employees To Add List
Teacher pay schedules
If some teachers receive pay over the entire year, while others receive pay just during the school year, you will need a separate PPG for each group. If they are paid on a monthly basis, one group should have 12 pays and another should have 9 or 10 pays.
If an employee has an occasional position that isn’t paid regularly, it should be assigned to a pay period group that has all possible pay periods for which the employee might work.
Example: Ms. Trulio is sometimes paid for extra hours supervising detention. If her normal salary is in the 24-period PPG, but she can only supervise detention during the school year, you can put the “Detention Supervisor” position into the same 24-pay period group or another semi-monthly group that doesn’t include the summer (probably 18 or 20 pay periods).
Note: Even if she only receives pay for the detention supervision monthly, it is best practice to put her into a PPG that contains semi-monthly pay periods. A single employee with multiple positions should still always be using the same pay period type (monthly, semi-monthly, bi-weekly, or weekly).
Because stipends are highly specific and often only paid once or a few times a year, you don’t need to create a whole new PPG for each stipend schedule. Instead, you will assign the position to a normal PPG and then select individual pay periods on the employee payroll item. Read more about it on the extra duty/stipend wages article.
Like employees with non-regular pay, substitute teachers have a pay frequency that is impossible to predict. You can assign them to a pay period group that starts with the first possible pay period they might work and ends with the last possible pay period they might work. For substitutes, this typically encompasses the school year and excludes the summer.