Process Adjustments using a Lump Sum Pay

Overview

If an employee’s pay is incorrect, can’t be adjusted using a timesheet adjustment, and has been submitted through STP, you will need to process any adjustments using a Lump Sum Pay.

If an adjustment is the result of a pay or charge rate being updated with a backdated start date, please refer to the Impact Report - Rate Change for processing these. 

Common Scenarios

Some common scenarios where a lump sum payment can be used for an adjustment are:

• Pay amounts or Pay Items used are incorrect;
• Non-timesheet items such as superannuation, PAYG, or deductions need to be adjusted or processed;
• Pays have been processed against the incorrect entity;
• Pays have been processed using the incorrect tax table;
• Pays have been processed incorrectly as an ETP or using an incorrect ETP code.
• Pays have been processed using pay, deduction, or superannuation items with the incorrect STP Report Settings. 
• Pays have been processed against the incorrect Engagement Type (Labour Hire/Personal Services Income vs. Salary and Wages)
• Pays have been processed with the incorrect Payroll Tax settings 

Some adjustments can be done in a single lump sum pay, but others will require that you process two separate lump sum pays. This will depend on the situation and what needs to be adjusted. 

An example of something where it can be done in a single lump sum pay might be something like a deduction that was processed using the incorrect deduction type. In this example, the incorrect and correct items would both be included in the same pay, one with negative units and one with positive units. 

An example of something that would require two separate pays would be if the employee had been paid under the 'Working Holiday Maker' tax table in error, and was supposed to be paid under the 'Tax Free Threshold' tax table instead. 

• the first lump sum pay would reverse all applicable pay items that had been processed under the Working Holiday Maker tax table
• the second lump sum pay would process all applicable pay items with the employee assigned to the correct Tax Free Threshold tax table. 

Important: Reversing and reprocessing pays will not automatically create an invoice adjustment, you'll need to create a manual invoice if required. If the adjustment can be processed in a timesheet, this is best practice.