Using Pay Grades

Pay Grades allow you to quickly report on remuneration and segment the employees in your organization. Pay Grades can be assigned to individuals and the codes/employment conditions associated with these when the pay grade is configured and lay the foundation for seamless integrations with your payroll platform.  This article will explain how pay grades can be configured within the settings area of intelliHR.

This article covers:

• How to Create Pay Grades
• Pay grades and employment conditions
• Pay grades and work classes
• Editing Pay Grades and viewing the timeline

How to Create Pay Grades

Pay Grades can be created provided you have the settings.pay_grades.edit permission enabled.

1. Open Settings > All Settings >> Pay Grades

2. Select Create Pay Grade

3. Enter the details associated with the pay grade

• Name - Name of the Pay Grade (seen by the end-user)
• Code - Code associated with the pay grade; not seen by the end-user but can be matched to a respective code in your payroll platform
• Employment Condition - Associated Employment Condition; when added, the employment condition will automatically be added to the employee's record when this pay grade is selected
• Description - Concise description of the pay grade design; visible to admins only
• Remuneration Type
  • Fixed - Selecting a fixed remuneration type allows you to define a single remuneration value that is automatically applied when this pay grade is chosen. 
    • Permanent Hourly Rate - Permanent hourly rate that will automatically be assigned to a person with this pay grade
    • Casual Hourly Rate - Casual hourly rate that will automatically be assigned to a person with this pay grade
    • Annual Salary - Annual Salary that will automatically be assigned to a person with this pay grade

• • Step - Selecting the Step remuneration type allows you to define various pay steps within a pay grade.
    • Add Pay Step - add the step names e.g. Management L1, L2, L3 and the remuneration associated with each pay step.
    • Repeat this action to add as many pay steps as required within this pay grade.

• Is Overridable - Checking this option will allow those creating users and their rem schedules to override the remuneration details as described above

4. Select Create

Pay Grades and Employment Conditions

Pay grades and employment conditions can be linked.

In general terms employment conditions can be used to represent awards, such as a hospitality award, and pay grades can be used to represent the specific pay grades within a specific award.

For example, you may choose to record the Hospitality Award as one of your employment conditions.

When creating or updating employment conditions these can be linked to multiple pay grades.

With Settings >> Pay Grades, the pay grades can represent the differing pay grades within the award.

A pay grade can only be linked to one employment condtion at any one time.

Through the connection of pay grades and employment conditions, admins can ensure that pay grades related to specific employment conditions are always chosen in line with the configuration here in Settings.

Both pay grades and employment conditions are date effective, meaning if an employment condition or pay grade is created/linked effective from Jan 3rd the system will display an error if you attempt to assigned the linked pay grade and employment condition on an employee profile prior to that date, such as Jan 1st.

Pay Grades and Work Classes

The work class 'Hourly Rate Type' field can be used to identify which remuneration rate from the pay grade configuration will be used.

You can set the hourly rate type to either Casual Hourly Rate or Permanent Hourly Rate.

Editing Pay Grades and Viewing the Timeline

The rates related to specific pay grades may change over time, especially if they are linked to industry awards, and therefore the standard remuneration rates for the pay grade will need to be updated.

To Edit a Pay Grade

1. Go to Settings >> All Settings >> Pay Grades >> Edit

2. Select the effective date of the changes you are making

3. Edit the details you need to amend (in most cases, this will be the remuneration section)

4. Select Edit

To View Timeline Changes to Pay Grades

1. In Settings >> All Settings >> Pay Grades any pay grade that has been updated will display the Last Updated Date

2. Select Edit on the pay Grade and the timeline of changes will also be displayed

The timeline can be helpful in determining when changes were made and by who, especially if this pay grade data is also consumed by your payroll software.

Common Issue Faced: Remuneration Fields Locked or Bulk Upload Fails

This issue occurs when the “Allow Manual Override During Job Update” setting is not enabled in the assigned pay grade.

When this setting is off, users are unable to manually update remuneration through an employee's profile or via bulk upload, even if they have the correct permissions.

To fix this:

1. Go to Settings > Pay Grades and select the relevant pay grade.
2. Tick "Allow Manual Override During Job Update."
3. In the Effective From field (as shown in the screenshot), select a date that is before the effective date of the remuneration update you're applying.

Saving these changes will allow you to proceed with the remuneration update as expected.