This article explains how to create and manage additional pay (for example, holiday allowance) in Personio.

In some countries, allowances that are defined relative to employees’ fixed salary are mandated by law, company agreements, or collective agreements. Additional pay allows you to grant allowances relative to employees' salary (for example, "8% of annual salary") and determine whether they're paid out on an annual or monthly basis. The Salary tab of an employee's profile displays additional pay, and you can add it there.

You need to first create additional pay on the Compensation settings page. After that, edit and manage it in the Salary tab or via an import.

Note:
Extra Pay isn’t available for Personio Payroll or DATEV. This means:
▶︎ Your account might include legal entities both with and without Personio Payroll or DATEV. If so, Extra Pay is only available to employees in legal entities without Personio Payroll or DATEV.
▶︎ If you set up Extra Pay before activating Personio Payroll or DATEV, it can remain configured. However, after you activate Personio Payroll or DATEV, you can’t map Extra Pay to salary data or salary components.

Before you start

To create, edit, or delete additional pay types, you need administrator rights or edit rights for Payroll (under Account Configuration).

To view or manage additional pay, you need permissions for the salary tab in the employee profile.

Create and manage types of additional pay in the compensation settings

You need to create types of additional pay in the compensation settings before you can assign it to employees. In the settings, you can also rename and delete additional pay types.

Tip:
Use filters and sorting to manage your compensation types. Sort or filter by type, name or created date, and use the search bar to quickly find what you need.

Create additional pay types

Follow these steps to create additional pay types in the compensation settings:

1. Go to Settings.
2. In the Payroll section, click Compensation.
3. Click Create New and select Additional pay as the type.
4. Enter a name for the compensation (for example, "Holiday Allowance"). Add a description (for example, "8% of annual salary") to make it easy to remember.
5. Set the amount as a percentage of the base salary, 
6. Set the accrual period: It’s the start of the period that is accounted for proration. When employees have only worked parts of an accrual period, the amount they get paid is reduced on a pro rata basis.
7. Set the payout schedule: Decide whether additional pay is paid annually or equally split into monthly instalments, and when it's accounted for in preliminary payroll.
8. Save the type.

Rename additional pay types

If you rename additional pay types, the new name appears retroactively across all of Personio. To do this, follow these steps:

1. Go to Settings.
2. In the Payroll section, click Compensation.
3. Click the additional pay type you want to rename.
4. In the drawer, click the three dots in the top right corner and select Rename.
5. Enter the new name and save your changes. 

Delete additional pay types

To delete a type of additional pay, follow these steps:

1. Go to Settings.
2. In the Payroll section, click Compensation.
3. Click on the additional pay type you want to delete.
4. In the drawer, click the three dots in the top right corner and select Delete.
5. Confirm the deletion and click Delete again.

Note:
If you delete an additional pay type, the change will be reflected retroactively across all of Personio. The compensation will be removed from all employee profiles. The history of all payments under this compensation type will be removed retroactively, and the compensation type can no longer be paid out.

Manage additional pay in the employee profile

In the employee profile, you can add and delete additional pay for individual employees.

Add additional pay

To manually add additional pay for an employee, follow these steps:

1. Go to the employee's Profile. Click the Salary tab.
2. Under Salary Components, click Add new and select Additional pay.
3. Select which additional pay you'd like to add.
4. Choose an Effective from date and click Add compensation to save your entry.

Note:
The additional will not appear in the salary table as a dedicated column. It only appears in the separate widget.

Stop additional pay

To delete additional pay for an employee, follow these steps:

1. Go to the employee's Profile. Click the Salary tab.
2. Select the Additional pay widget.
3. Click the three dots on the top right corner and select Stop compensation.
4. Enter the Effective until date and confirm to stop the accrual and payout. 

Add additional pay through an import

To reduce the amount of data you need to enter manually, you can also add individual additional payments for employees through an import. Before doing so, you need to create the additional payment first. To import additional pay, follow these steps:

1. Download the import template for additional pay.
2. Enter the relevant data for each employee.
3. Upload the completed template.

Find detailed instructions in our article on importing salaries.

Manage additional pay after an employee leaves or receives a salary increase

When employees receive their additional pay within the accrual period and then either: 

• Leave the company before the end of the accrual period.
• See a salary increase between payout and the end of the accrual period.

The preliminary payroll does not reflect the corresponding corrections. You need to make a manual adjustment, for example, via a negative one-time compensation.

Example:
The accrual period is January - December.
The payout  is in July.
The employee receives the additional pay in July. The resignation happens in August and they leave the company in September, before the end of the accrual period.
They should have received less in July. Since the amount has been paid out already, there is no automatic correction.