Setting Up Employee Payroll

Purpose

Every active employee needs payroll details completed before your company can run payroll. This step tracks each employee as Complete or Incomplete, based on three mandatory sections: Federal Tax Withholding, State Tax Withholding, and Payment Method. Until all active employees are complete, the Prior Compensation and employee State Taxation areas stay locked, and the rest of setup cannot finish.

Who can do this: Any user whose role includes the Payroll permission, or the employee-level payroll permission for individual records. This is usually the Employer Admin, but other admin roles can be granted the same access.

Prerequisites

• Employees exist in UZIO with SSN and compensation recorded, and are assigned to a pay group
• Each employee's W-4 details (federal) and state withholding form details
• Bank details for employees choosing direct deposit

Steps

1. In the payroll setup checklist, open Employees Payroll Set up. Each employee shows Complete or Incomplete, with Active or Terminated in the Status column.
2. Click Status to sort. Bring active employees to the top and work through those first. Terminated employees do not need setup.
3. Open an incomplete employee (click the dots next to their name) to see the three mandatory tabs.
4. Federal Tax Withholding: click the pencil (edit) icon, enter the employee's W-4 withholding information, and click Update. Fields on this tab:

[Screenshot: Federal Tax Withholding tab in edit mode showing exemption status, W-4 version, and the override fields; use demo data]

1. State Tax Withholding: click the pencil icon, enter the state withholding details, and click Update. The fields on this tab depend on the employee's work and home states. UZIO shows the questions from that state's withholding certificate (see State W-4 Form List for which form applies). A setup for a future-effective work or home location appears only once that location becomes effective.

1. Payment Method: click the pencil icon next to Payment Method Set Up and choose Direct Deposit or Check:
• Check: no further details needed. You print and hand the employee a check after each approval. See Printing Employee and Contractor Checks.
• Direct Deposit: choose a distribution method, then enter the account details (below). Employees can split their net pay across multiple accounts either by Percentage (of net pay) or by Flat Dollar amount with priorities. This choice applies to the whole split, not per account. The highest-priority (last) account receives the remainder.

For each direct deposit account:

At least one account is required. You can delete an account only while more than one exists.

Two save-time checks protect the split:

• Someone must actually get paid. A setup where every account is $0 or 0% is blocked: "This direct deposit setup can't be saved because none of the accounts is set to receive the employee's pay. Enter an amount greater than $0 on at least one account, or leave one account blank to receive the remaining balance." (Employees see the same message phrased as "your pay" in self-service.)
• Percentage splits must total exactly 100%, with each account's share between 0.01% and 100%.

[Screenshot: Payment Method tab showing a direct deposit split with routing number, account number, and priority fields; use demo data]

1. Repeat for every active employee.

[Screenshot: Employees Payroll Setup list showing Complete/Incomplete statuses and the three mandatory tabs on an employee record]

Complete the optional tabs while you are there

Saving the three mandatory tabs moves the employee to Complete. The employee's payroll record has several more tabs worth completing now so you do not return later:

• Tax Exemptions: per-tax Exempt/Not Exempt status for the employee, separate from the company-level Tax Exemption Setup on the Federal Taxation step. One dropdown per applicable tax type. A View History link shows prior effective-dated changes.
• Minimum Wage Rate: Is this employee subject to a minimum wage? (Yes/No). If Yes, enter the Minimum Wage Rate (0.00 to 99.99, per hour) and an effective date. Confirm the rate against federal and state or local labor law for the employee's work jurisdiction. UZIO does not validate the rate against any wage floor. A View History link shows prior rates.
• SOC Code: the employee's Standard Occupational Classification code (up to 10 characters; numbers, hyphens, and periods only), with an effective date. Used on some states' unemployment returns. The same screen carries the Treasury Tipped Occupation Code (TTOC) card for employees in qualifying tipped occupations (W-2 Box 12 Code TP from Tax Year 2026). Details in Understanding and Finding SOC Codes.
• Earnings, Deductions, Contributions: you can only pick items already created at the company level. If something is missing, add it under Company Earnings, Deductions, or Contributions first, then return. When you assign a deduction you also answer How do you wish to limit this deduction amount?: Annually (an annual maximum), Lumpsum (a total amount owed, after which the deduction stops), or No Limit. Garnishment orders have additional fields; see Setting Up Employee Garnishments.
• Workers' Compensation: if the employee's wages are subject to workers' comp, assign the appropriate code from the Workers Compensation Code drop-down. Codes are created at the company level. See Setting Up Workers' Compensation Codes.

Expected outcome

• All active employees show Complete.
• The Prior Compensation and State Taxation areas unlock, letting setup continue.
• Employees become payable in pay runs. Their withholding, payment method, and assigned earnings, deductions, and contributions drive every paycheck from the next pay run onward.

Common problems

Why won't the direct deposit setup save?

Work down this list:

1. No account is set to receive pay. Every account is $0 or 0%. You will see "This direct deposit setup can't be saved because none of the accounts is set to receive the employee's pay. Enter an amount greater than $0 on at least one account, or leave one account blank to receive the remaining balance." Give at least one account a real amount, or leave the last-priority account blank to catch the remainder.
2. Percentages don't total 100%. On a percentage split, the shares must add up to exactly 100, each between 0.01% and 100%. Adjust and re-save.
3. A routing or account number failed validation. Routing numbers are checked against a validity algorithm. Account numbers must be 5 to 17 digits and unique across the employee's accounts.

Why can't I edit an employee's payment method?

The employee is enrolled in DailyPay. While enrolled, their pay routes to the DailyPay account, the edit pencil is hidden, and the form reads "Payment method changes are not allowed while DailyPay is active. Saved accounts are paused and resume automatically if DailyPay is cancelled." Enrolled employees also cannot be switched to Check. The lock lifts automatically when the employee cancels DailyPay. See Earned Wage Access (EWA) Integrations.

An employee changed payroll-relevant details while a run is in flight

Payment methods freeze inside an initiated payroll. If a mid-run change (such as a DailyPay enrollment or cancellation) leaves the run out of date, approval is blocked. The fix is to cancel and re-initiate the run, or exclude the affected employee. Those approval blockers live in Troubleshooting: I Can't Start or Approve Payroll.

Why can't I pick the pre-2020 W-4 for an employee?

Either the employee was hired on or after January 1, 2020, or a pre-2020 record was already saved once. In both cases, use the 2020-and-later version.

Still stuck?

If an employee will not move to Complete after all three tabs are saved, please reach out to us at support@uzio.com or call +1-571-601-1752. Include the employee's name and employee ID, which tab shows the problem, the exact message, and a screenshot. Do not send SSNs, W-4 images, or full bank account numbers.

Related articles

• Payroll Setup Overview
• Understanding and Setting Up Pay Groups: employees must be assigned to a pay group
• State W-4 Form List: which state certificate the State Tax Withholding tab follows
• Understanding and Finding SOC Codes: SOC and Treasury Tipped Occupation Codes (TTOC)
• Setting Up Employee Garnishments
• Earned Wage Access (EWA) Integrations: DailyPay payment-method locks
• Submitting Your Direct Deposit Information: the employee self-service side