# Setup Pay Items and Employee Templates in Xero

Source: https://docs.astalty.com.au/guide/setup-pay-items-and-employee-templates-in-xero

> Configure pay items and employee pay templates in Xero for the Astalty payroll integration.

Scheduling add-on - This feature requires the Scheduling add-on, which is available on Astalty Premium. See How to enable Scheduling.

> **Before you begin - choose your Pay Item method**
>
> There are two ways to configure Pay Items in Xero for the Astalty payroll integration. Review both options below before proceeding, as this choice affects how you set up Pay Items, Employee Pay Templates, and Pay Groups.
>
> **Rate Per Unit** - Each Pay Item is configured with a fixed dollar rate per hour.
>
> - Check leave accrual, ordinary earnings and superannuation settings in Xero for the employee and earning type. A fixed rate alone does not configure those entitlements.
> - Requires a separate Pay Group in Astalty for every pay classification (e.g. Level 2 Pay Point 1, Level 2 Pay Point 2), with dedicated Pay Items for each.
>
> **Multiplier (Recommended)** - Pay Items are configured using a multiplier applied to the employee's base rate in their Pay Template.
>
> - Lets employees with different base rates share the same award multipliers. Check leave and superannuation settings separately.
> - Use separate casual and permanent Pay Groups for each award, with additional groups where rates or arrangements differ. Xero calculates amounts from the multiplier and the employee's base rate.
> - Check the resulting hourly rates and pay-run totals against the applicable award. Do not assume a one-cent base-rate adjustment resolves every rounding difference.

## Overview

Before timesheets can be successfully sent from **Astalty** to **Xero**, you need to ensure that the correct **Pay Items** and **Employee Pay Templates** are configured in Xero.

**Pay Items** define the different types of earnings employees can receive, such as ordinary hours, overtime, or allowances. When timesheets are exported from Astalty, the hours worked are mapped to these Pay Items so they can be processed correctly in Xero payroll.

Astalty sends each mapped Xero earnings-rate ID with daily hours or allowance units. It does not send calculated dollar amounts. Xero applies the Pay Item and employee Pay Template configuration, so review the resulting rates and totals in Xero before posting payroll.

The Xero paths below follow current Xero Payroll AU documentation. Available fields and labels can depend on your Xero organisation and access. If they differ, use Xero's current [custom pay item](https://central.xero.com/0/article/Add-a-custom-pay-item) and [employee Pay Template](https://central.xero.com/0/article/Create-or-edit-a-pay-template-for-an-employee) instructions.

> **One award per pay group**
>
> Pay items are mapped per **pay group**, and a pay group's mapping can only encode one award's rates. If you employ staff under more than one award (for example SCHADS Support Workers and Nurses Award staff), give each award its **own pay group** - a timesheet export stops with a clear error if a pay group mixes awards. Use the mapping table for the relevant award: [SCHADS](https://docs.astalty.com.au/guide/scheduling/scheduling-faq/schads-interpretations-in-astalty), [Nurses](https://docs.astalty.com.au/guide/scheduling/scheduling-faq/nurses-award-interpretations-in-astalty), [Aged Care](https://docs.astalty.com.au/guide/scheduling/scheduling-faq/aged-care-award-interpretations-in-astalty) and [Health Professionals](https://docs.astalty.com.au/guide/scheduling/scheduling-faq/health-professionals-award-interpretations-in-astalty). Do not copy SCHADS multipliers to another award.

## Configure Pay Items in Xero

**Pay Items** define the different types of pay employees receive - such as Ordinary Hours, Overtime, Weekend Rates, Public Holiday Rates, and Allowances. These must be set up in Xero so Astalty can correctly map scheduled hours to the appropriate payroll categories.

The steps to create Pay Items are the same regardless of which method you use. What differs is the **value you enter** for each Pay Item - the [Xero Payroll - Pay Item Configuration](https://docs.google.com/spreadsheets/d/1aYA3zmdC9kLpz-91gbSQi7hAR_0sZ04IGpcMyPQM7DE/edit?gid=1275525005#gid=1275525005) reference lists example figures for both methods:

- **Rate Per Unit**: enter the correct dollar amount for each award classification, employment basis and earnings category. Separate rates need separate pay items and mappings.
- **Multiplier**: use the relevant award page's multiplier table and the employee's unloaded base rate. Separate pay items for every classification are not needed when the multipliers are identical.

Set every allowance Pay Item's unit type to **Hours**, regardless of what the allowance is for - kilometre, sleepover, first aid and other allowances all use hours. Astalty also accepts Xero Pay Items whose **Type of Units** is the singular **Hour**. Other values, including **hrs**, **Kilometres** and **Fixed Amount**, cannot be used on a Xero timesheet. Allowances can still share a Pay Item only where their rate is the same. Check the current Award and the [rate-maintenance guidance](https://docs.astalty.com.au/guide/scheduling/setup/workers/staff-contracted-hours#maintaining-award-rates), including temporary changes.

Ensure that all pay rates used within **Astalty Scheduling** have a corresponding **Pay Item in Xero**.

### To configure Pay Items in Xero:

1. Log in to **Xero**.
2. Navigate to **Payroll** and select **Payroll Settings**.

![Xero with the Payroll menu marked 1 and open, and Payroll settings at the bottom of the menu marked 2.](https://docs.astalty.com.au/assets/xero-payroll-settings-nav.png)

3. Open the **Pay Items** tab.
4. Click **Add**, choose the pay item category, complete the fields for that item, then click **Add** to save it. Edit an existing item where appropriate instead of creating a duplicate.

![Xero Payroll settings with the Pay Items tab highlighted, an arrow pointing to the Add button on the Earnings list, and an earnings item's menu open with an arrow pointing to Edit.](https://docs.astalty.com.au/assets/xero-pay-items-tab.png)

![The Xero Ordinary Time Earnings dialog with Earnings Name, Display Name, Rate Type set to Rate per Unit, Type of Units set to Hours, Rate per Unit, Expense Account, tax and super checkboxes, and a Save button.](https://docs.astalty.com.au/assets/xero-pay-items-add.png)

## Setup Employee Pay Templates

Once your **Pay Items** are configured, you will need to review each employee's **Pay Template** in Xero.

The **Pay Template** defines the default payroll settings for an employee, including ordinary earnings, deductions, superannuation and reimbursements. When timesheets are exported from **Astalty**, the daily units are matched to the mapped **Pay Items**. Follow Xero Payroll AU's current requirements for the employee's ordinary earnings and superannuation lines.

Any **Deductions, Superannuation, or Reimbursement lines** should be configured according to the employee's employment contract. Steps 3 onwards are the same for both methods - the key difference is what you enter in the **Ordinary Hours rate field**.

### Rate Per Unit Method

The mapped pay items carry the fixed rates. Review the employee template for competing rate overrides and default earnings that could duplicate imported hours. Confirm the applicable Xero configuration with your payroll administrator.

**To review an Employee Pay Template (Rate Per Unit):**

1. In **Xero**, navigate to **Payroll > Employees**.

![Xero with the Payroll menu marked 1 and open, and Employees under Employee Management marked 2.](https://docs.astalty.com.au/assets/xero-payroll-employees-nav.png)

2. Select an employee and open the **Pay Template** tab.
3. Confirm that the mapped rates and template produce the intended ordinary earnings, without duplicate default hours.
4. Review any **Deductions, Superannuation, or Reimbursement lines** to ensure they reflect the employee's contract.
5. Click **Save** if any updates are made.

![An employee's Pay Template tab in Xero, highlighted, with the Rate field on the Ordinary Hours earnings line highlighted and left empty, and an arrow pointing to Save.](https://docs.astalty.com.au/assets/xero-pay-template-rate-per-unit.png)

Repeat this process for **all employees who will have timesheets exported from Astalty**.

### Multiplier Method

Under the Multiplier Method, you need to enter the employee's **full-time equivalent base rate** in the rate field - for both casual and permanent staff. The multipliers configured on each Pay Item will automatically add casual loading and other adjustments on top of this base rate.

> **Note**
>
> Compare the calculated hourly rate and pay-run amount with the applicable minimum. Investigate rounding differences in the affected earning item with your payroll administrator; do not apply a blanket one-cent adjustment.

**To review an Employee Pay Template (Multiplier Method):**

1. In **Xero**, navigate to **Payroll > Employees**.
2. Select an employee and open the **Pay Template** tab.
3. Enter the employee's **full-time equivalent base rate** in the Ordinary Hours rate field.
4. Check the calculated casual, penalty and overtime rates against the award. The guide's casual multipliers already include casual loading; adding it to the base rate too would count it twice.
5. Review any **Deductions, Superannuation, or Reimbursement lines** to ensure they reflect the employee's contract.
6. Click **Save**.

![An employee's Pay Template tab in Xero with an arrow pointing to the tab, and the Rate field on the Ordinary Hours earnings line highlighted with a base hourly rate entered.](https://docs.astalty.com.au/assets/xero-pay-template-multiplier.png)

Repeat this process for **all employees who will have timesheets exported from Astalty**.

Changing a base rate in Astalty does not update Xero. Maintain both systems and check enabled allowance rates before each affected pay run.

## Setting up Pay Items Video Walk-Throughs

### Rate Per Unit Method

In this video, we demonstrate how to **create Pay Items in Xero** using the Rate Per Unit Method.

Video walkthrough: setting up pay items in xero.

### Multiplier Method

In this video, we demonstrate how to **create Pay Items in Xero** using the Multiplier Method.

Video walkthrough: multiplier method pay items in xero.

## Setting up Employee Pay Templates Video Walk-Throughs

### Rate Per Unit Method

In this video, we walk through how to **review and configure Employee Pay Templates in Xero** using the Rate Per Unit Method.

Video walkthrough: setting up employee pay templates.

### Multiplier Method

In this video, we walk through how to **configure Employee Pay Templates in Xero** using the Multiplier Method.

Video walkthrough: multiplier method employee pay templates in xero.

## Next Steps

You're now ready to map your **Pay Groups** and **Employees** in Astalty. [Setup Pay Groups and Employees in Astalty](https://docs.astalty.com.au/guide/setup-pay-groups-and-employees-in-astalty) for the guide.