HR & Payroll

The daily routine this module replaces

Before the module is installed, the payroll clerk arrives at 7:30 a.m. to collect paper attendance sheets from the four gate registers. Each sheet lists 120–150 names, hand-written by the security guard. The clerk ticks off late arrivals, early departures and half-days, then transfers the figures into a ruled A3 ledger. Overtime is calculated by hand: any shift that runs past 18:00 is rounded to the nearest quarter-hour and multiplied by the hourly rate. The ledger is passed to the production manager for initials; if he is on the floor, the clerk waits, sometimes for an hour.

Leave applications arrive as chits pinned to the notice board. The clerk copies them into a separate leave register, deducts the days from each employee’s balance and files the chits in a cardboard box. Balances are updated once a week; if an operator asks for a balance mid-week, the clerk counts the chits by hand.

Advances and loans are recorded in a third notebook. The clerk checks the recovery amount against the previous payslip, subtracts it from the gross wage and writes the net figure on a scrap of paper. The paper is handed to the accountant, who enters the total into the general ledger at month-end.

Piece-rate workers bring bundles of tickets to the clerk every Friday. Each ticket shows the bundle number, weight and piece count. The clerk sorts the tickets by operator, tallies the totals and multiplies by the rate per thousand pieces. Daily-wage workers’ hours are taken from the attendance ledger and multiplied by the daily rate. Monthly staff receive a fixed salary, but deductions for absent days are calculated manually. All three wage types are combined on a single spreadsheet, printed and signed off by the factory manager before the accountant posts the journal.

How a document moves through the module

Employee master

The HR officer creates the record once, entering name, clock number, department, wage type (monthly, daily or piece-rate), basic rate and statutory details. The record is posted to the master file; no stock or ledger entries are made.

Attendance

The security guard swipes cards at the gate. The system records the timestamp and flags late arrivals, early departures and half-days. At 19:00 the shift supervisor reviews the exceptions on screen, corrects any misreads and posts the attendance. The post updates the employee’s attendance balance and creates a provisional overtime line, but does not yet affect the ledger.

Leave application

The operator raises the request on the shop-floor terminal. The system checks the leave balance and routes the request to the supervisor. The supervisor approves or rejects it; if approved, the system deducts the days from the balance and flags the absence in the attendance module. When the attendance is posted, the absence is automatically included in the wage calculation. No stock or ledger entries are made until payroll is run.

Advance / Loan

The operator requests an advance on the terminal. The HR officer enters the amount, recovery period and monthly deduction. The request is posted; the system creates a liability line in the ledger (credit Advance Payable, debit Cash) and schedules the recovery in the next payroll run. When payroll is posted, the recovery is deducted from the net wage and the liability is reduced.

Payroll run

On the last working day of the month, the payroll clerk selects the pay period and reviews the draft. The system calculates gross wages for each wage type: monthly staff receive the basic salary minus absent days; daily-wage staff are paid for the days worked; piece-rate workers are paid for the pieces recorded. Overtime, leave encashment and recoveries are added or subtracted. The clerk posts the run; the system generates payslips and creates a journal that debits the departmental wage accounts and credits the payroll clearing account. The accountant reviews the journal and posts it to the general ledger, moving the wage cost from the clearing account to the bank account when salaries are paid.

The reports it produces and the decision each one supports

What usually goes wrong when a plant runs without it

Attendance sheets are lost or smudged. The clerk misreads a name, and an operator is marked absent when she was present. The error is discovered only when the operator complains at month-end, and the correction is made on a scrap of paper that never reaches the accountant. The wage bill is overstated, and the operator is short-paid.

Leave balances are not updated in real time. An operator applies for leave, is told the balance is sufficient and books a train ticket. When the leave register is updated a week later, the balance is negative. The leave is refused, the ticket is forfeited and the operator is absent without leave. The supervisor marks her present to avoid a confrontation, and the wage bill is inflated.

Advances are recorded in a notebook that is left on the clerk’s desk. The notebook is borrowed by a supervisor and not returned. When payroll is run, the recovery is omitted. The advance is never repaid, and the liability remains on the books until the next audit.

Piece-rate tickets are tallied by hand. The clerk miscounts a bundle, and the operator is underpaid. The operator complains, the clerk recalculates and finds the error. The correction is made on the payslip, but the spreadsheet is not updated. The wage bill is understated, and the accountant posts the wrong journal. The departmental cost report shows a variance that cannot be explained.

Overtime is calculated on paper. The clerk rounds 18:17 to 18:30, and the operator is overpaid. The error is repeated every month, and the overtime cost creeps up. The production manager notices the trend but cannot trace it to a single operator or shift. The budget is exceeded, and the factory manager cuts overtime across the board, slowing production.

Payroll is posted to a single ledger account. The accountant cannot see which department incurred the cost, so the departmental cost report is based on estimates. The weaving department is overcharged, the finishing department is undercharged, and the profit margin on each order is distorted. The sales team quotes prices that are too low for some orders and too high for others.