Pay Group

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Pay Group

What is a Pay Group?

Pay group is defined as the group of employees with similar characteristics, for example, pay scale, a slab of the grading system, pay date, pay package, etc.

It is very common in the organizations that several people are posted on a similar pay package and they are paid on the same date as well – though the departments may vary and the date of joining etc. may be different too, but the pay group is for the sake of the ease of your payroll to process for a single time for employees to be paid with same features.

In the United States region, when payroll is processed for North America, the identical characteristics are taken into consideration so far as the employees are concerned, say the type of employee, frequency of payment, similar location, etc.

What is more, if you have citizens from Canada as well working with your company in North America, you need to run a separate payroll. Similarly, if the sequence of the checks issued is different for any reason, like the different citizenship discussed here, different payrolls are to be run at the same time.

And if the print stock you use for checks and payment advice is more than one, you are required to change the print stock differently for different pay groups. Therefore it is inferred that you may have as many pay groups for your payrolls as needed.

What characteristics make a pay group?

Below mentioned are the key feature characteristics that group together to form a pay group:

  • Employees belonging to the same Organization
  • Similar payment frequency
  • Same checks utilization for advises form of direct deposits
  • Identical pay periods sharing
  • Alike checks date
  • Employees working in the same country
  • Minimum net pay is the same
  • Matching work schedule
  • Same bank services utilization
  • In the United States: the employees should share the same FLSA – Fair Labor Standard Act conditions

Moreover, an employer can group the several pay groups for different employees categorically but only if that practice is viable on a concurrent basis.