Each payee in the Payees tab of Payroll Setup > Third Party Payees requires a payment method. For system payees, this is already defined, and for custom payees, you must define it.
Generally, you can define the payment method for custom payees and review payment method for system payees in the Payment Method section of the payee's details.
When a payee selects United States of America as the operating country and selects either Garnishment or Child Support Payment as the payee category, the Payment Method section displays a message that the payee must be paid through Dayforce Payment Solutions. No other options are available.
Dayforce provides the following payment methods:
Manual Payment
The payee receives payments produced by your organization outside of Dayforce, such as a check that is produced during your organization’s account receivable process. This option represents any third-party payee that is paid outside of Dayforce but is a payee who is recorded in Dayforce that your organization still wants to link back to Dayforce.
When you select this option, there are no additional settings to configure in the Payment Method section.
Check/Cheque
(Available for US and Canadian payees only) Dayforce, Inc. collects the funds to pay the payee, and generates a printed check. Dayforce, Inc. sends the check to your organization in the default client delivery package, and your organization must then send the check to the payee.
When you select this option, Dayforce displays additional configuration settings.
| Setting | Description |
|---|---|
| Statement Message | Enter a short memo that appears on the checks that are issued to the payee. |
| Payable To | Enter an override name to appear on checks issued to the payee when different from the name configured for the payee. For example, an administrator can use this option if garnishment payments must be made directly to the person to whom the payments are owed rather than to a garnishment processor. |
| Combine Employees | Select this checkbox to combine all employees who contributed to the total into a single payment to the payee. If this option isn’t selected, the payee will receive individual payments for each employee, and one statement per payment. |
| Combine Earnings and Deductions | Select this checkbox to combine all eligible earnings and deductions into a single payment to the payee. If this option isn’t selected, the payee will receive individual payments for each earning and deduction. If you select both the Combine Employees and Combine Earnings and Deductions settings together, Dayforce produces a single payment to the payee. If you only define Combine Earnings and Deductions, Dayforce, Inc. produces one payment for each employee. |
| Show Employee Details | Select this option for the statement to list each employee who contributed to the total payment. |
| Allow Negative Values | Checkbox that becomes available if you selected the Combine Employees checkbox. Allow you to enter negative adjustments to employees third-party payments, which can affect the total funds sent to the payee and that is impounded with payroll funding. For additional information, see the last section in this topic |
| Statement Language Preference | (Canadian payees only) Select the language in which the payee prefers to receive check statements. |
Electronic Fund Transfer (EFT)
(Available for Canadian, UK, US, and Australian payees) Dayforce, Inc. facilitates payment transactions by sending an Electronic Fund Transfer (EFT) file to the bank account on record and disburses the funds by EFT. The Dayforce Back Office doesn’t impound payments.
When you select this option, Dayforce displays specific banking settings for each country, plus general settings on how Dayforce, Inc. generates the payments and statements.
| Setting | Description |
|---|---|
| Method | Select which method payment to initiate to the payee. |
| Account Number | The number of the payee's account at the financial institution. |
| Transit Number | The five-digit transit number used to correctly route payments to the payee's financial institution. |
| Bank Number | The three-digit bank number used to correctly identify the bank. |
| Bank Name | A read only field that Dayforce populates when you enter transit number and a bank number. |
| Statement Language Preference | (Canadian payees only) Drop-down list that you can use to select the language in which the payee prefers to receive check statements. |
| Allow Negative Amounts | Checkbox to allow negative amounts to become available. |
| Suppress print of advice statements | Checkbox to suppress the printing of payee advice statements when the payment method is Electronic Fund Transfer (EFT). |
| Setting | Description |
|---|---|
| Method | Select which method payment to initiate to the payee. |
| Account Number | Enter the number of the payee's account at the financial institution. |
| Sort Code | Enter the six-digit sort code that identifies the bank and branch of the payee's account. |
| Bank Name | A read only field that Dayforce populates when you enter the account number and sort code. |
| Building Society Number | For building society accounts, enter the building society roll number. |
| Payment Frequency | Select the frequency that payments are to be made to the payee. Options are Monthly, Quarterly, Annually, Weekly, 2 Weekly, and 4 Weekly. |
| Schedule Start Date | Enter a start date for the schedule for paying third-party payees. |
| Schedule End Date | Enter an end date for the schedule for paying third-party payees. |
| Schedule Pay Date | Enter a date to set the first actual day that the payee receives payment in their bank account. |
| Combine Employees |
Checkbox to combine all employee payments as a total amount in one payment line in the BACS file. When the checkbox is cleared, payments are broken up by employee and are listed on individual payment lines in the BACS file. This checkbox is selected by default. Note: If the Combine Employees checkbox is cleared and a refund is processed, the negative BACS amount won’t be processed and the refund won’t be displayed in the BACS file. |
| Setting | Description |
|---|---|
| Method | If the selected option hasn’t been configured for the employee's Legal Entity Funding ID, the payee funding method will default to Manual. |
| Account Number | Enter the number of the payee's account at the financial institution. This is the destination account number (this field is unavailable if you select Health Savings Account Provider in the Payee Category drop-down list). |
| Transit Number | Enter the nine-digit transit number used to correctly route payments to the payee's financial institution. This is the destination transit number. |
| Account Type | Select Checkings or Saving 22s. |
| Bank Name | A read only field that Dayforce populates when you enter a transit number and an account number (this field is unavailable if you select Health Savings Account Provider in the Payee Category drop-down list). |
| Setting | Description |
|---|---|
| Method | Select the payee funding method of EFT. |
| Account Number | Enter the number of the payee's account at the financial institution. |
| BSB Code | Enter the six-digit BSB code that is used to route payments to the payee's financial institution. |
| Branch Name and Location | Not enabled. |
| Lodgement Reference Number | Enter details such as Invoice Number, Unique Customer Identifier or PRN (Payment Reference Number). Any reference entered in this field is displayed in the aba file. |
| Payment Frequency | Select the frequency that payments are to be made to the payee. Options are Monthly, Quarterly, Annually, Weekly, Bi Weekly, and 4 Weekly. |
| Schedule Start Date | Enter a start date for the schedule for paying third-party payees. |
| Schedule Pay Date | Enter an end date for the schedule for paying third-party payees. |
| Combine Employees |
Checkbox to combine all employees who contributed to the total into a single payment to the payee. When the checkbox is cleared, payments are broken up by employee and are listed on individual payment lines. Note: If the Combine Employees checkbox is selected, the Allow Negative Amounts checkbox is enabled. |
| Combine Earnings and Deductions | Select this checkbox to combine all eligible earnings and deductions into a single payment to the payee. |
| Show Employee Details | Select this option to display each employee who contributed to the total. |
| Allow Negative Amounts | Select this option to allow negative amounts to be available. |
| Setting | Description |
|---|---|
| Combine Employees | Select this option to combine all employees who contributed to the total into a single payment to the payee. If this option isn’t selected, the payee will receive individual payments for each employee and individual EFT statements for each payment. You can select or clear this checkbox only when you select Health Savings Account Provider in the Payee Category drop-down list. If you select another payee category, the checkbox displays but isn’t enabled, and this checkbox doesn’t display if you select Child Support Payment or Garnishment. |
| Combine Earnings and Deductions |
Select this checkbox to combine all eligible earnings and deductions into a single payment to the payee. If this option isn’t selected, the payee will receive individual payments for each earning and deduction. If you select both the Combine Employees and Combine Earnings and Deductions checkboxes, Dayforce produces a single payment to the payee. If you select the Combine Earnings and Deductions checkbox but leave the Combine Employees checkbox cleared, Dayforce produces one payment for each employee. You can select or clear this checkbox only when you select Health Savings Account Provider in the Payee Category drop-down list. If you select another payee category, the checkbox displays but isn’t enabled, and this checkbox doesn’t display if you select Child Support Payment or Garnishment. |
| Show Employee Details | Select this option for the statement to list each employee who contributed to the total payment. This option is only available if you select Health Savings Account Provider in the Payee Category drop-down list. |
| Allow Negative Values | Checkbox that becomes available if you selected the Combine Employees checkbox. If you select the Allow Negative Values checkbox, you can enter negative amounts to employee third-party payments, which can affect the total funds sent to the payee and that is impounded with payroll funding. For additional information, see "Allow Negative Values – Important Information" later in this section. |
| Suppress print of advice statements | Suppresses the printing of payee advice statements when you select Electronic Fund Transfer (EFT) as the payment method. The checkbox isn’t available for all payee categories and countries. |
Electronic Data Interchange (EDI)
(Applicable for Canadian system payees only. This option isn’t available for you to select for custom payees.) Dayforce collects the funds to pay the payee, and disburses the funds electronically.
Allow Negative Values – Important Information
When you select Allow Negative Values, Dayforce does the following:
- Combines employee deductions and employer contributions assigned to the payee, whether positive or negative amounts.
- Indicates whether or not the payee can accept negative amounts.
- Ensures that payments are stopped when the accumulated amount is zero.
When you select Allow Negative Values, Dayforce doesn’t do the following:
- Stores or rolls over negative values to carry forward to a future pay run
- Allows for negative adjustments to impact other third-party payments where the feature isn’t activated
Important: When allowing for negative adjustments to employees with third-party payments that are impounded with payroll funding, auto voids aren’t included in impound totals and are focused on transactions/impoundable funds that are processed in the current pay run only. Auto void transactions won’t impact the total impound for the third-party payment in the pay run. Dayforce doesn’t currently support returning/refunding any funds that have already been impounded and remitted to vendors, employees, or tax agencies in previous runs.
Important: If you enter a negative value adjustment, you must remember to remove it later.
When an employee has a negative deduction/contribution that is tied to a third party payment, Dayforce displays the following warning when calculating payroll:
"This Employee has negative contributions/deductions that will affect the remittance to Payee - <payee name>."
When the total amount of the payment to the payee is less than zero, Dayforce displays the following error message when validating payroll:
"Your Third Party payment to <payee name> Payee will not be generated as the amount is less than 0.00. Please review your Third Party Payment Report for details. and make adjustments as necessary."