How to enter negative wages in payroll
Learn how to accurately enter negative wages in payroll to correct overpayments and adjustments.
What are negative earnings?
Negative earnings are adjustments made to reduce an employee’s previously overstated wages. Instead of voiding and reissuing a paycheck, you can enter a negative amount under the relevant earning code to offset prior overpayments.
When to use (and not use) negative earnings
Appropriate use cases
Use negative earnings when:
- Correcting overpaid wages or incorrect hours
- Adjusting overtime or shift differentials mistakenly applied
- Reallocating hours between earning types (e.g., converting sick leave to vacation)
- Avoiding miscellaneous post-tax deductions for overpayment recovery
When not to use them
Avoid using negative earnings when:
- Voiding an entire paycheck
- Adjusting earnings that were never paid
- Adjusting prior year wages (consult support instead)
- The adjustment would result in negative net pay for the employee
Examples
Example 1: Overtime correction
An employee was overpaid for 10 overtime hours instead of the correct 5 hours. On the next paycheck, you enter -5 overtime hours under the same code. This corrects the overpayment and ensures accurate year-to-date totals.
Example 2: Pay code reallocation
An employee was paid 8 hours of sick time, but it should have been 8 hours of vacation time. To fix this:
- Enter 8 hours under the sick leave code
- Enter +8 hours under the vacation code
This maintains correct totals while reallocating the hours properly.
How to enter negative wages in payroll
You can enter negative wages in two ways:
- During standard payroll entry in your payroll product
- In Check’s Console:
- Go to the Payrolls tab
- Create a new payroll or edit an existing one
- Enter a negative value in the hours or amount field under the relevant earning code
Important: Ensure the adjustment does not cause the employee’s total wages to go negative—this will block payroll processing.
FAQs
How do negative wage adjustments comply with state labor laws?
Always verify that the adjustment does not reduce wages below applicable minimum wage thresholds. Consider legal requirements related to garnishments or child support withholdings before applying changes.
What documentation should I maintain?
You should keep a record explaining the reason for the adjustment and share it with the employee in advance. This promotes transparency and ensures proper audit readiness.
When should I escalate a negative wage issue?
If the adjustment involves:
- A large overpayment
- An employee who is no longer active
- Multi-payroll or prior year impacts
Submit a ticket via Zendesk to Check Support for assistance and guidance.
Recording
Last updated on June 30, 2024