Please note: this article is about the Justworks Payroll product. Not sure which product you're using? Check out: How Do I Know Which Justworks Product I Have?
You can set up manual deductions on employees’ payroll for benefits or services your company may provide outside of Justworks Payroll. Examples of typical manual deductions would include outside policies for medical, dental, and/or vision insurance, transit benefits, or an external 401k benefit.
How to Set Up a Manual Deduction
If you need to set up a manual deduction for an employee, administrators with ‘make payments’ permissions can do so from their Justworks Payroll account by following the steps below.
To start, click on the ‘Employees’ tab on the left-hand side menu of your account. Then, select the name of the employee who needs a manual deduction put in place.
Once you have their profile page up, choose ‘Deductions’ from the tabs on the left side of the page. Then, click the ‘Add manual deduction’ button.
On the next page, you can enter the details of the manual deduction, including the deduction type, amount, and label. The employer contribution section is for record keeping purposes, and will not withdraw any funds from your company’s account.
Then, you can select the frequency of the manual deduction, which will determine how often the deduction is applied to the employee’s payments. This is how the first and second pay period option applies to different pay frequencies:
- Semimonthly pay frequency: The deduction would apply to the 15th and last pay day date of the given month
- Biweekly pay frequency: The deduction would apply to the first two pay periods in a given month
- Weekly pay frequency: The deduction would apply to the first two pay periods in a given month
Lastly, you can set the start and end dates for the manual deduction. If the manual deduction needs to be indefinite, you do not need to select an end date.
After reviewing the details of the manual deduction, you can click ‘Save’ and the manual deduction will be added to the employee’s account.
How to Remit Funds from a Manual Deduction
When a manual deduction is applied to an employee’s payment, the amount that the manual deduction is set for will remain in the company’s bank account instead of getting paid out to the employee with the rest of their net pay. Instead, the funds remain in the company’s bank account so that the company can manually remit the deduction amount to the applicable provider.
Please note that Justworks Payroll does not facilitate transfers of manually deducted funds to any third party on a company’s behalf.
How to Stop a Manual Deduction
If you need to remove a manual deduction from an employee’s account, you can bring up the employee’s profile page and click into the ‘Deductions’ tab again.
On that page, you will see a list of the employee’s manual deductions and an option to edit them.
To stop a manual deduction from occurring, you can click the ‘Edit’ button, then choose an end date that is in the past and save the change.
Moving forward, the manual deduction will no longer apply to the employee’s payments.
Disclaimer
This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, legal or tax advice. If you have any legal or tax questions regarding this content or related issues, then you should consult with your professional legal or tax advisor.