How are arrears calculated?

What are arrears?

Arrears refer to the payment of salaries that were left unpaid earlier and are now being compensated. An example of this would be when an employee gets a salary hike in one month but receives the amount in a different month. The amount that is paid later is called arrears. Paying arrears means paying an employee for the work completed in a previous pay period instead of the current pay period. 

How to calculate arrears using Keka HR

Navigate to Payroll (1) >> Run Payroll  (2) >> Salary on Hold & Arrears (3).

On the Salaries on Hold & Arrears window, click on Save and Continue till you get to the Arrears tab. 

You will now see the details of the employees' arrears. Click on the amount under the Total Arrear Amount column.

When you click on the amount, the Arrear Breakup will be shown. 

If the above breakup doesn't include any particular salary component that you want to be included, check the settings against that particular component. 

To change these settings, navigate to the following location:

Payroll (1) >> Settings (2). 

Select a pay group if you have more than one configured in the Pay Groups tab and click on the Configure Icon.

In the Salary Components tab, select the component you want to edit and click on the Edit Icon in the Actions column.

 

Select the Include this component in arrears calculation checklist item. Once done, click Update and there you are!

If you have any questions in this regard, please refer to the other articles. Have unanswered questions?  Then, do contact us!