Employee contracts and allowances: what payroll is built on

The contract is what payroll reads. An employee with no active contract never enters a payroll run, however complete their card is.

Creating a contract

1. Open HR → Employee Contracts and press Add Contract — image 1.
2. Pick the employee and the job title.
3. Enter the contract number and the contract type — full time, part time or temporary.
4. Set the start date, and an end date for a fixed-term contract — leave it empty for open-ended.
5. Enter the basic salary; the daily salary is derived from it.
6. Under allowances and deductions press Add Component for each one: pick the component, the amount and whether it is an earning or a deduction.
7. Save.

Salary components

HR → Salary Components is the dictionary allowances are built from — image 2. Each has an Arabic and English name, a type (earning or deduction) and a fixed or variable flag.

• Fixed — an amount that does not change monthly: housing, transport. Entered on the contract once and repeated every month.
• Variable — changes by month: overtime, commission. It enters payroll from its own source, not the contract.

Notes

• One active contract per employee. On renewal or a salary change, end the old contract and create a new one so the salary history stays right.
• An expired contract shows as expired and drops the employee out of payroll — watch the contract-expiry report so it does not surprise you.
• The basic salary is also the base for the end-of-service benefit, not the gross.
• Check the ready-made salary components before adding a new one; duplicates fragment your reports.
• Allowances entered on the contract appear automatically in every payroll run with no re-entry.