Use Case: An employee’s overtime is tracked using timesheets, and the employee requires compensation for this overtime during payroll, in addition to their regular salary.

Procedure:

1. Begin by creating an Employee record.
2. Establish a Salary Component named “Overtime” categorized as Earning.
3. Create a Salary Structure and include the “Overtime” component with the amount initially set to 0.
4. Within the Salary Structure, activate the “Salary Slip Based on Timesheet” option. Choose the “Overtime” Salary Component and input the Hourly Rate.
5. Save and submit the Salary Structure, then assign it to the relevant Employee using Salary Structure Assignment.
6. Generate Timesheets for this Employee using the Timesheet DocType.
7. Create a new Payroll Entry for the month (e.g., January) and select the “Salary Slip Based on Timesheet” checkbox. Save the entry, click “Get Employees,” and subsequently “Create Salary Slips.”

The Salary Slip for the employee will automatically retrieve any associated timesheets for that month and compute the Overtime Component accordingly.