Hourly to Salary Conversion Due to Promotion

Thanks for sharing what you'd like to achieve, @User_20200731.

We're unable to use hourly and salary rates in one payroll cycle. Though, we can create an item manually and add it to the employee's paycheck.

Here's how:

1. Go to Lists and then select the Payroll Item List tab.
2. Select Payroll Item and then select New.
3. Click Custom Setup, then select Next.
4. Select Wage and then select Next.
5. Choose Hourly Wage.
6. Select the appropriate pay type.
7. Note: For holiday pay or other types not specifically listed, choose Regular Pay.
8. Then click Next.
9. Enter a name for the pay item and then click Next.
10. Choose the Expense account where you want to track wages.
11. Select Finish.

Then, we can now add the item to the paycheck. I'll guide you how:

1. From the Employees menu, select Payroll Center.
2. Click Start Unscheduled payroll.
3. Select the name of the employee.
4. Select Continue on the prompt message.
5. Then click on Continue.
6. Select Open Paycheck Detail.
7. On the Item Name field, select the item you've created.
8. Review the items and then click Save & Close.
9. Click Create Paychecks.

Once done, let's change the rate of your employee to salary. Moving forward, this rate will show on your employee's info.

1. From the Employees menu, select Employee Center.
2. Double click the name of the employee.
3. On the payroll info tab, select Salary.
4. Once done, click on OK.

Also, to merge duplicate employees, you can make it identical to the one you're merging it with and click OK. Then select Yes to confirm.

Additionally, I've included an article that'll guide you in viewing what you've paid out. This way, you'll keep track of your payroll totals: Create a payroll summary report.

We're always here to help if you have other payroll concerns. Have a great day!

What happens if an employee voluntarily transfers from salary to hourly what would the process be to convert in that direction also, and avoid creating a duplicate employee profile?

The employer must be informed if an employee wants to be paid on an hourly rate, User_20200731.

You'll just have to edit the employee's earning information to change from salary to hourly and to avoid duplicate employee's profile.

Here's how:

1. Go to Employees, then select Employee Center.
2. Double-click on the employee's name.
3. Select the Payroll Info tab.
4. Click on the blank area, in the Earnings box, below Item Name column.
5. Select the drop-down arrow, then select your Hourly item.
   
6. In the Hourly/Annual Rate column, enter the employee's hourly rate.
7. Click OK.

In case you'll want to customize your payroll reports, here's an article for your reference: Customize Payroll And Employee Reports.

Drop a reply below if you need further assistance. I'll be here to help.

How identical does the duplicate employee A need to be to duplicate employee A.1? 

What are the minimum essential items that are required to be the same to have a successful merger?

Thanks!  @CharleneMaeF 

Employee A

First Name:   A.

Middle Name:  Example

Last Name: Example

Payroll Schedule: Biweekly

Item Name = A - Hourly

Various Taxes

Class = 123

Employee A.1 

First Name:  ATrue

Middle: Example

Last Name: Example

Payroll Schedule: Biweekly

Item Name = A – Salary

Various Taxes – 1

Class = NULL

You're on the right track, @User_20200731!

You can create a new employee profile with the salaried payroll data so you can merge it with the existing one. No need to duplicate all the payroll information as long as the employee's legal name is a match, QuickBooks will merge it successfully.

In addition, here's an article you can read to learn more about how to merge any names: Merge Accounts, Customers, and Vendors.

Lastly, I've got you this helpful article for ideas about how you can create a payroll check: How do I create a paycheck for an employee?

Keep me updated in the comments if you have any other questions. I'll be here to lend a hand.

@CharleneMaeF 

RE: "We're unable to use hourly and salary rates in one payroll cycle. "

Yes, of course you can.  QB has always supported using both hourly and salary items on the same paycheck.

What would be the best way to go about correct two employee profiles, after payment has been has been issued? These two employee profiles are for the same employee but payment has been issued and this spans over several months. @BigRedConsulting 

This is a hard case for a few reasons:

1. You can't change the employee name on an existing paycheck.

2. You can't merge two employees that have both been paid.

3. The taxes on the paychecks may have over-run the annual limits, since they're split between two employees.

Here's what I'd do, very carefully:

In the end, you'll keep the employee that has a lot of data, and work to remove the new one incorrectly set up, which has only a few months of data.

One paycheck check at a time, starting with the oldest paycheck for the new unwanted employee, create a new paycheck for the old employee that is a duplicate:

- Make sure all the payroll items and amounts - from Gross to Net - are exactly the same on the new check as on the existing check, even if you have to overwrite the amounts manually.  Technically, you don't need to do this for the company paid taxes and other company paid items, as they don't contribute to the check amount, but you can do so.

- Double check that all the amounts are the same using payroll reports for the period you're duplicating the checks.  The main "Payroll Summary" report will be useful in this case.  You can filter it for one day, and/or for the entire period in question.

- Once you're sure the new paychecks mirror the existing ones, then carefully delete the paychecks for the unwanted employee.

- Then delete that employee from the employee center.

So, here is some additional clarification of what I ended up doing with QuickBooks Payroll support.

As previously mentioned in the thread, you need to have the hourly and salary set up.

However, you need to reverse engineer the gross annually salary by the expected payroll gross total for the salary component (manually calculate), and then process payroll.  After payroll has been processed, then update the Employee Profile to reflect the true annual salary.

Example if company is set up biweekly:

• Target Payroll 10 hours @ 15 per hour and $750 salary.
• First setup the salary line item in QuickBooks then take 750 * 52 / 2 = 19,500.
• Then go to the payroll cycle and confirm that the total amount of that first transitional payroll salary has $750.00. If not, revert and make correction as needed in the Employee profile.
• Once payroll is processed and adjust payroll annual salary for that employee up to sought target  or source documents of 38,000.
• Next payroll discontinue use of hourly and only use salary line item.

Yes, you can do salary and hourly on one payroll. But, you need to do it carefully and thought out.

Thanks @BigRedConsulting !