How to correct an underpayment in 7shifts Payroll
Issue
An employee was paid less than they were owed in a previous payroll cycle. This may occur due to missed hours, incorrect wage settings, or adjustments that were not applied before the payroll run was processed.
Cause
- Underpayments are often caused by missing or unapproved hours in 7shifts Time Clocking at the time of the payroll run.
- Individual employee role wages do not automatically update when changes are made to the general Labor and Compliance minimum wage settings.
- Wage updates made with a past effective date do not retroactively adjust payroll runs that have already been processed.
What to do
⚠️ Important: 7shifts recommends consulting an accountant or payroll advisor to confirm the appropriate correction method for your specific business and compliance needs.
To correct an underpayment, you must run an off-cycle payroll in 7shifts Payroll to issue the missing wages. Choose the appropriate path below based on how you need to record the payment.
Option 1: Manually enter hours or sync from timesheets
Use this method if the underpayment is due to missed or unapproved hours.
- Manually add the missed hours during the off-cycle payroll run, or
- Sync hours from the timesheet if they are already recorded.
Tip: For consistent reporting, add any missed hours to 7shifts Time Clocking before starting the payroll run if the hours are not already present. When adjusting for missing or incorrect wages, ensure the off-cycle payroll dates cover the entire period of the wage discrepancy.
Option 2: Use a custom earning code
Use this method for lump-sum corrections, such as back-paying an employee for a wage rate adjustment, without recording specific hours.
- Calculate the total amount owed and add it using a Custom Earning Code such as Non-hourly regular.
- This approach is useful when back-paying an employee due to a wage rate correction or other lump-sum scenario.
Option 3: Correct a $0 net pay due to withholding
This path applies if an employee received a $0 payment because their total earnings could not cover the required tax withholdings.
Have the employee update their W-4 form if needed.
Run an off-cycle payroll to pay the employee the correct amount.
Contact the 7shifts Support team to void the $0 pay item from payroll history so reporting stays accurate.