Off-cycle Payroll

Employees aren't always paid on regular payroll cycles. Employers may need to schedule one-off payments to employees for a variety of reasons, including:

• An employee earns a bonus or commission not paid with their regular payroll
• An employee needs to be paid or reimbursed before their regular payday
• The employer needs to correct an underpayment to an employee
• The employer needs to pay a terminated employee

For these and other scenarios where an employer wants to pay one or more employees outside of a regular payroll, you will need to offer the ability to create off-cycle payrolls.

To run an off-cycle payroll, set the Payroll type to off_cycle. This tells Check that the payroll is being run outside the normal payroll schedule. Your off-cycle payroll flow should allow employers to pick a subset of employees to pay in the off-cycle payroll.

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A pay period start and end is required for all payrolls, regardless of type. This is to provide clarity to employees—it will show up on employee paystubs—and to ensure compliance across all 50 states.

Employers generally expect more configurability for off-cycle payrolls than for regular payrolls. For example, an employer will likely want to exclude an employee's typical health benefit contribution from an off-cycle bonus payment. Or an employer may want to tax a correction to an underpaid employee as supplemental earnings.

Advanced off-cycle payroll options are exposed via the Check API through the off_cycle_options attribute on the Payroll object. We recommend surfacing these options directly, or through an “advanced configuration” panel, in a user-facing off-cycle payroll flow. The configurable off-cycle options are as follows:

• force_supplemental_withholding: This field tells Check how to calculate employee taxes. If set to true, Check will tax all earnings as supplemental earnings. If set to false, Check will calculate taxes as it usually does, using the taxability of each earning type and the company's default pay_frequency. By default, this field is set to false. The employer's decision to use the regular or supplemental withholding rate type has no impact on the income taxes ultimately owed by an employee at the end of the year.
• apply_benefits: This field tells Check to apply benefit deductions and contributions to this payroll. By default, this field is set to false.
• apply_post_tax_deductions: This field tells Check to apply post tax deductions to this payroll. By default, this field is set to false.

Once approved, an off-cycle payroll should be treated the same as a regular payroll. Employers should be able to view and inspect both their regular and off-cycle payrolls. Employees should see paystubs for regular and off-cycle payrolls. It can be helpful to visually distinguish regular payrolls from off-cycle payrolls for clarity, but is not required.