As an employer, you are required to pay employees overtime when they work past a certain threshold, and you have to issue extra vacation pay on certain holidays. To make this task easier, you may want to use earning codes in your time tracking methods. To explain, imagine you are doing payroll. You know that an employee has worked 50 hours, but you’re not sure which hours are regular, overtime, or holiday hours. This lack of information can result in mistakes and wasted time. In contrast, if your employee had the ability to apply earning codes to his or her hours, it would help to eliminate this hassle. If you have a very small staff and track hours manually, a simple handwritten code on the sign-in and sign-out sheet can do the trick. In other cases, you may want to look into software or apps such as Nexonia Timesheets, which lets your employees code their hours. If you work with clients or on different projects, you may also want to use software that lets you code hours based on specific clients or projects. That allows you to track where you are investing payroll hours. You may need a system that allows you to code benefits and bonuses in multiple ways. For example, with some noncash taxable bonuses, you have to deduct income tax and Canada Pension Plan contributions, but you don’t have to withhold employment insurance premiums. Knowing this information helps with payroll and boosts your compliance with tax laws. When setting up payroll systems, you want to ensure the system you select makes your job easier. Typically, that requires earnings codes, up-to-date information on payroll taxes, and any other functions you think may be useful. Consider checking out a few different programs before settling on your decision.