Overview
Congrats on selecting a Reasonable Compensation for your Annual Salary! Please read the action steps below to update your salary with Gusto. This is a very important step. If you are a new onboarding member, we have most likely pre-filled Gusto for you. If you've already completed onboarding, be sure to update Gusto each time that you complete the salary module with Collective.
Your annual salary is used to calculate your monthly payroll. It's not the amount that must be run through payroll by the end of the calendar year.
Your monthly payroll = annual salary/payroll frequency per year. Most of our members run payroll once a month. For example, the monthly payroll for an annual salary of $36,000, on a monthly payroll frequency, is 36,000/12 = $3,000/month.
Action - Update your Salary with Gusto
Login to gusto.com
Click the People section and select Team members.
Click on your employee's name.
Under Compensation, click edit.
Enter in their new salary or hourly rate.
Select an effective date for the new compensation by selecting a specific pay period from the drop-down menu. Select the first available pay period. The first day of the pay period is the day the change will take effect.
Click Save.
This compensation change is used to alter your monthly payroll.
Your monthly payroll = annual salary/payroll frequency per year. Most of our members run payroll once a month. For example, the monthly payroll for an annual salary of $36,000, on a monthly payroll frequency, is 36,000/12 = $3,000/month.
You do not need to process any catch-up payroll when setting a new salary. Think of it as a raise at work, the boss doesn't retroactively catch you up. Though we can all dream :-)
Note: If you are in a community property state (i.e. California) and have chosen to split your salary with your spouse, the total of both spouses' wages should still be within the recommended reasonable compensation range. For example, if the total reasonable compensation chosen is $50,000, you may choose to pay yourself $25,000 and your spouse $25,000.