Issue

I updated the wage for an employee, but the pay rate isn't updating to reflect the new wage. Why doesn't the state retirement pay rate updated when I make changes to the employee's annual wage? 

 

 

Explanation

The following changes apply when the state is California (CA). 

In version 2025.08 or earlier, when you would make changes to the employee wage, then you would also need to manually update the state retirement pay rate to calculate correctly for state retirement.

This has been fixed in version 2025.11 or later. After you make changes to the employee wage, you will be asked if it's okay to update the state retirement pay rate. 

 

Clicking Yes will 

• Monthly. The new annual wage is divided by 12 months (New Annual Wage ÷ 12 months = State Retirement Pay Rate). (The state retirement pay rate is rounded to the nearest penny.)

• Hourly. The new annual wage is divided by employee position estimated annual hours (New Annual Wage ÷ Employee Position Estimated Annual Hours = State Retirement Pay Rate). The state retirement payment rate is rounded to the nearest penny. If the value is zero, then it will check if the full time hours per week is not equal to zero. The system will use that number x 52 to calculate the state retirement payment rate. 

• Daily. If the new annual wage is zero, then the system will use CA full time days per week x 52 to calculate the pay rate (CA Full Time Days per Week x 52 = State Retirement Pay Rate). 

 

 

Example

	Formula	New annual wage	Pay rate
Monthly	New Annual Wage ÷ 12 months = State Retirement Pay Rate	$50,000.00	$4,166.67
Hourly	New Annual Wage ÷ Employee Position Estimated Annual Hours = State Retirement Pay Rate	$50,000.00	$24.04
Daily	CA Full Time Days per Week x 52 = State Retirement Pay Rate	$50,000.00	Depends on CA full time days per week.

 

 

Solution

You must be running version 2025.11 or later. 

 

To enter a new annual wage and update the state retirement pay rate, 

1. Open Connect Payroll > Modify Existing Employees. 

2. Set the state retirement options.  

• Navigate to the Job tab > Retirement tab. 

• Select the pay rate type: Monthly, Hourly, or Daily. 

 

3. Enter the new annual wage. 

• Navigate to the Positions tab > Wage tab. 

• If you're using a pay schedule, select the new pay step. 

• If you're not using a pay schedule, enter the new annual wage. 

 

4. Review the state retirement pay rate. 

• Navigate to Job tab > Retirement tab. 

• Verify the pay rate. 

 

 

 

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