Introduction

Arrears refer to salary amounts that become payable to an employee for a previous payroll period due to corrections, revisions, attendance adjustments, payroll processing delays, or other compensation-related changes. Instead of modifying previously processed payroll records, organisations often pay the difference in a future payroll cycle as arrears.

One common scenario occurs when employee attendance or paid days need to be adjusted after salary has already been processed. In such cases, organisations may choose to compensate employees by paying additional salary for the adjusted days. To support this requirement, uKnowva HRMS provides an Adjustment Days Arrears mechanism that allows payroll administrators to add or deduct salary based on adjustment days and process the corresponding amount through payroll.

Within uKnowva HRMS, there are two different methods available for handling arrears. The first method is based on Adjustment Days, while the second method is based on Salary Revision Arrears Calculation. In this article, we will focus on configuring and processing arrears using Adjustment Days.

If you wish to learn about configuring arrears using the salary revision method, you can refer to this dedicated tutorial available for that process.

Step 1: Access the Adjustment Days Arrears Configuration

To begin, navigate to the top-right corner of the page and click on your profile icon.

From the available options, select uKnowva Configuration. This will open the system configuration panel.

From the left-side menu, click on Apps Manager and locate the HRM Lite application. Open its configuration page.

Within the HRM Lite settings, you will find the arrears-related configuration options. As mentioned earlier, the system supports both Salary Revision Arrears and Adjustment Days Arrears. For this article, we will configure the settings required for processing arrears through adjustment days.

Step 2: Configure Adjustment Days Arrears Settings

Scroll through the HRM Lite configuration page until you locate the Adjustment Days settings.

Start by configuring the Enter Adjustment Day Head Title field. This title becomes the payroll component name under which adjustment day earnings or deductions will appear during salary processing.

Next, locate Enable Import for Adjustment Days in Extra Earnings/Deductions Page and enable the toggle if you want administrators to import adjustment day records through the Extra Earnings and Deductions module instead of entering them manually one by one.

You will then find the Adjustment Days Pay Type In Salary setting.

The first option is Add Adjustment Component Wise in Salary. When this option is selected, the adjustment amount is added directly to the respective salary components during payroll processing. The adjustment becomes part of the salary structure and is distributed across applicable salary heads.

The second option is Add Adjustment As Component Wise Arrears in Salary. When this option is selected, the system calculates the adjustment separately and displays it as arrears against the affected salary components. Instead of merging the adjustment directly into the salary structure, the payroll reflects the additional amount as component-wise arrears. 

After selecting the preferred adjustment pay type, configure the Enter Adjustment Day Head Suffix field.

This suffix is applicable only when the adjustment pay type is configured as Add Adjustment As Component Wise Arrears in Salary. The suffix is appended to the adjustment head title, making it easier to distinguish adjustment arrears from regular salary components in payroll reports and payslips.

Next, configure whether statutory deductions should be calculated on adjustment day payments.

Enable Calculate Provident Fund while paying Adjustment Days if adjustment amounts should be considered for PF calculations.

Enable Calculate ESIC while paying Adjustment Days if ESIC contributions should be calculated on the adjustment amount.

Similarly, enable Calculate Professional Tax also while paying Adjustment Days if Professional Tax should be included while processing adjustment day payments.

These settings ensure that adjustment day payments remain compliant with your organisation's payroll and statutory requirements.

After completing all the required configurations, click on the Save button to apply the settings.

Step 3: Verify Adjustment Days Plugin Availability

Before processing adjustment day arrears, ensure that the Adjustment Days functionality is enabled within your uKnowva HRMS instance.

The adjustment days calculation process depends on the availability of the corresponding plugin and related payroll configurations.

Once the required functionality is active, you can proceed with creating adjustment day records for employees.

Step 4: Navigate to the Earnings & Deductions Module

After completing the configuration, navigate to the left-side navigation panel and click on the HR menu.

From the available options, select Payroll and then click on the Earnings & Deductions sub-menu.

This page displays existing earning and deduction records that have been created within the system.

To create a new adjustment day record, click on the + icon available above the list.

This action opens the earnings and deductions entry form.

Step 5: Create an Adjustment Days Record

Inside the form, begin by selecting Type as Earning, since adjustment day arrears are generally processed as additional earnings.

Next, select Group as Adjustment Days.

After selecting the group, choose the relevant employee in the Employee Name field.

The form will then allow you to enter details required for adjustment day calculations.

Once you select the employee, the Per Day Salary, which represents the amount payable for one working day, will be automatically populated by the system.

Next, specify the Adjustment For Month and Adjustment For Year, which indicate the payroll period for which the adjustment is being made.

Enter the number of Adjustment Days that need to be compensated.

The system uses these values to calculate the adjustment amount automatically.

After that, select the Month and Year in which the payment should be processed.

The calculated amount will appear in the Amount field.

You can also provide additional details in the Remarks field to document the reason for the adjustment.

If required, select Add Direct as Yes or No depending on how you want the adjustment to be processed.

You may also attach supporting documents or approval records through the Attachment field for future reference and audit purposes.

Once all information has been entered, click on the Save button.

The adjustment day record is now created and becomes available for payroll processing.

Step 6: Process the Adjustment During Payroll Generation

After the adjustment day record has been saved, proceed with the regular payroll generation process.

During salary processing, the system automatically considers the adjustment day record according to the configuration selected in the HRM Lite settings.

Depending on the selected Adjustment Days Pay Type, the amount will either be added directly to salary components or displayed separately as component-wise arrears.

If statutory deduction calculations such as PF, ESIC, and Professional Tax have been enabled, the system will also calculate those contributions accordingly.

Once payroll is generated, the adjustment day earnings become visible in payroll records and employee payslips.

Conclusion

That’s it!

You’ve now successfully configured and processed arrears using Adjustment Days in uKnowva HRMS.

By following this process, you can compensate employees for attendance corrections, payroll adjustments, or additional payable days without modifying historical payroll records. 

If you have any questions or need additional support, feel free to contact us at This email address is being protected from spambots. You need JavaScript enabled to view it..