Salary Structures

A salary structure defines what an employee is paid. It links an employee to their basic salary and a set of payroll components (allowances, deductions, and taxes) with specific values. When payroll is processed, the system reads each employee's active salary structure to calculate their pay.

What a Salary Structure Contains

Each salary structure record includes:

Field	Description
Employee	The employee this structure belongs to
Basic Salary	The employee's base monthly salary before any allowances, deductions, or taxes
Currency	The currency for this salary (e.g., USD, NPR)
Effective From	The date this structure takes effect
Effective To	Optional end date. If blank, the structure remains active indefinitely.
Is Active	Whether this is the employee's current active structure
Components	The specific allowances, deductions, and taxes assigned to this employee
Notes	Optional internal notes

Assigning Components to Employees

Creating a Salary Structure

1. Navigate to HRM > Salary Structures in the sidebar, or open an employee's detail page and go to the Salary Structures tab.

2. Click Create Salary Structure.

3. Fill in the basic information:

   • Employee — Select the employee.

   • Basic Salary — Enter the monthly base salary.

   • Currency — Select the currency.

   • Effective From — The date this structure becomes active.

   • Effective To — Leave blank for an open-ended structure, or set a date if this is temporary.

   • Is Active — Toggle on to make this the employee's current structure.

   • Notes — Optional.

Adding Components

Below the basic fields, you will see three sections for adding salary components:

• Allowances — Components that add to the salary

• Deductions — Components that reduce the salary

• Taxes — Tax components applied to gross salary

For each section:

1. Click Add to add a component row.

2. Select the Component from the dropdown. This lists all active payroll components of the matching type.

3. Set the Calculation Type — Fixed or Percentage. This defaults to the component's configured calculation type but can be overridden per employee.

4. Enter the Value — The specific amount or percentage for this employee.

Example: Your organization has a House Rent Allowance component with a default value of 40%. For a specific employee, you might set it to 50% based on their location.

1. Repeat for each component you want to include.

2. Click Create.

The component value in a salary structure can differ from the component's default value. The default is simply a starting point — each employee's structure can have customized values.

Component Calculation During Payroll

When payroll is processed, the system calculates each component's monetary amount:

• Fixed components — The value is used as-is (e.g., Transport Allowance = 5,000).

• Percentage components — The amount is calculated from the basic salary (e.g., HRA at 40% of 50,000 = 20,000).

Tax components are an exception — percentages for taxes are calculated on the gross salary (basic + allowances + overtime), not on the basic salary alone.

Effective Dates & History

Salary structures use effective dates to track compensation changes over time. This means you always have a full history of what an employee was paid and when.

How Effective Dates Work

• Effective From — The date the structure starts being used for payroll calculations.

• Effective To — The date the structure stops being active. Leave blank if the structure has no end date.

• Is Active — Only one salary structure per employee should be active at a time. The active structure is used for payroll processing.

Making a Salary Change

When an employee receives a raise or their compensation changes:

1. Open the employee's current salary structure.

2. Set the Effective To date to the last day the current structure applies (e.g., end of the current month).

3. Deactivate it by toggling Is Active off.

4. Create a new salary structure with:

   • The updated Basic Salary and/or component values.

   • Effective From set to the first day of the new period.

   • Is Active toggled on.

This preserves the historical record — you can always look back and see what the employee was earning during any period.

Ensure only one salary structure is marked as active per employee at any time. If multiple structures are active, the payroll system may use an unexpected one during processing.

Viewing Salary History

From an employee's detail page, go to the Salary Structures tab to see all structures (past and present) in reverse chronological order. Each card shows:

• Basic salary and currency

• Effective date range

• Active/inactive status

• Component breakdown (allowances, deductions, taxes)

• Notes

Deletion Guardrails

A salary structure cannot be deleted if it has been used in any payroll entries. This protects the integrity of historical payroll records. You can deactivate it instead by toggling Is Active off and setting an Effective To date.

Employee Portal

Employees logged into the Employee Portal can view their own salary structures from the Salary Structures tab on their profile. They can see their basic salary, components, and effective dates, but cannot create or modify salary structures.

Filtering and Views

The Salary Structures list page includes these pre-built views:

View	Description
All Salary Structures	Shows all salary structures regardless of status
Active Structures	Shows only currently active structures

Additional filters are available for employee, effective dates, basic salary range, currency, and active status.