Using 6 decimal places for allowances and pay items in your platform
There may be a situation where you require the decimal places in your pay items or allowances to go to 6 places. This will provide you with a more accurate pay amount if you have the following scenarios in your business:
- You have employees who are paid a large amount of quantity-based allowances. In this circumstance, calculating this total based on a rounded decimal amount can result in a substantial difference in an employee's pay.
- If you have monthly allowances that you break down to pay as a daily allowance, In this circumstance, you'll need to ensure that the monthly breakdown by day retains as many decimal places as possible to ensure the accuracy of the employee's pay overall.
Here is an example of where 6 decimals may be required to ensure correct rounding in payslips.
If your business calculates a quantity-based allowance (such as kms) to 6 decimal places at $1.123456 and the quantity is 5,000,
- Then 5,000 x $1.123456 = 5617.25
- With 2 decimal place rounding (5,000 x 1.12) this employee would only be paid = $5,600.0
- With 6 decimal place rounding (5,000 x 1.123456) this employee would be paid = $5,617.25
You can see from the above that the employee will be paid more accurately with the extra decimal rounding enabled.
Please note: If you'd like to use extra decimal places, this must be enabled as a function on your platform. See below for instructions.
If you would like the allowances in your platform to use 6 decimal places, you will first need to enable it in your settings.
To do so:
- Go to the main menu > Platform settings > System settings.
- Scroll to the bottom and turn on 'Allow Pay Items/Allowances to go to 6 decimal places'.
- Press Save Settings.
Once the extra decimal places are enabled, you'll be able to add or edit allowance/pay item to 6 decimals within:
- An individual Award
- and the Allowance library.
We are working on adding this functionality to our rate rise tool, if you need to increase these allowance rates during a rate rise please do so directly.
The payslip calculation is based on those decimals and shown on the payslip. Keep in mind, the employee is still paid a two-decimal amount for this line item.
Please Note: If this setting is not enabled on your platform, it will error if a user enters a pay rate for an allowance or pay item that is more than two decimals. Instead, they will see a validation message prompting the user to choose a number between the nearest two decimal options (see the image below).