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How to manage pay rate changes mid pay period in Xero

Sean Wyse By Sean Wyse Updated 12 January 2026 3 min read
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This article explains how to manage payroll in RosterElf and Xero when an employee\'s pay rate changes partway through a pay period. Handling mid-pay run rate increases correctly is important for accurate payslips and compliance.

You’ll learn how to process the payroll in RosterElf, adjust timesheets in Xero, and split earnings lines to reflect the new rate. This ensures employees are paid the correct amount for hours worked before and after the rate change.

This guide is ideal for payroll administrators and managers who process wages through RosterElf and Xero. The steps are clear, simple, and help reduce errors in employee payments when rates change during the pay cycle. This section outlines how to handle a rate increase that takes effect mid pay period. You'll update the employee’s timesheet in Xero by splitting hours into separate earnings lines, so old and new rates are applied correctly.

This method helps ensure payroll compliance and accurate tax reporting.

Frequently asked questions

1. How do I manage a pay rate increase in RosterElf and Xero?

Start by processing payroll as usual in RosterElf, then export the timesheet to Xero. In Xero, split the hours into two earnings lines—one for the old rate and one for the new rate—and apply the correct rates on the payslip before finalising the pay run.

2. Do I need to manually update the pay slip after a rate change?

Yes. After adjusting the timesheet in Xero, you must open the pay slip, add the new pay rate to the secondary earnings line, and save the changes to ensure accurate payment and compliance.

3. Can I use one earnings line for both old and new pay rates?

No. You should create a separate earnings line in Xero for the hours worked after the rate change. This keeps pay calculations accurate and simplifies compliance with tax and employment laws.

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1.1 Process payroll in RosterElf

1.1.1 Log in to your RosterElf account.

Xero integration screen in RosterElf

1.1.2 Process the payroll as normal.

Xero integration screen in RosterElf

1.2 Adjust timesheet in Xero

1.2.1 In Xero, go to Payroll then Timesheets.

Screenshot showing Payroll then Timesheets navigation in Xero
1.2.2 Open the relevant employee's timesheet.

Screenshot showing employee timesheet selection in Xero
1.2.3 Add a secondary earnings line for the new rate.

Screenshot showing how to add a secondary earnings line in Xero
1.2.4 Move the approved hours from 1 July onwards to this new line.
Screenshot showing moving approved hours to new earnings line in Xero

1.2.5 Leave previous hours before 1st of July on the original earnings line.

Screenshot showing original earnings line with hours before rate change in Xero
1.2.6 Approve the timesheet.

Xero integration screen in RosterElf
After updating the timesheet, you’ll need to edit the employee\'s pay slip to reflect the new pay rate. This step ensures the new rate is applied only to the hours worked after the increase.

These adjustments are done in Xero before finalising the pay run.

2.1 Adjust pay rate on the payslip

2.1.1 In Xero, go to Payroll then Pay Employees.
Screenshot showing Payroll then Pay Employees navigation in Xero

2.1.2 Create a new pay run.
Screenshot showing creating a new pay run in Xero

2.1.3 Open the employee's pay slip.
Screenshot showing opening employee pay slip in Xero

2.1.4 Enter the new rate for the secondary earnings line.

Screenshot showing entering new rate for secondary earnings line in Xero
2.1.5 Save your changes.
Screenshot showing saving changes to pay slip in Xero

2.1.6 Repeat for other staff with rate changes. FAQs about payroll rate increase during pay run 1. What is a payroll rate increase mid pay run?
A payroll rate increase mid pay run refers to when an employee’s hourly wage changes partway through a pay period. To handle this correctly, hours worked before and after the change must be split and paid at the appropriate rates.

2. How do I manage a pay rate increase in RosterElf and Xero?
Start by processing payroll as usual in RosterElf, then export the timesheet to Xero. In Xero, split the hours into two earnings lines—one for the old rate and one for the new rate—and apply the correct rates on the payslip before finalising the pay run.

3. Do I need to manually update the pay slip after a rate change?
Yes. After adjusting the timesheet in Xero, you must open the pay slip, add the new pay rate to the secondary earnings line, and save the changes to ensure accurate payment and compliance.

4. Can I use one earnings line for both old and new pay rates?
No. You should create a separate earnings line in Xero for the hours worked after the rate change. This keeps pay calculations accurate and simplifies compliance with tax and employment laws.

5. What date should I apply the new rate from?
Apply the new pay rate to hours worked from the effective date of the change—e.g., 1 July. Move only those hours to the new earnings line in Xero and update the rate on the payslip accordingly.