# Payroll Processing

> Process a payroll cycle: compute pay and taxes, check compliance, and disburse payments. Use when running payroll or computing employee compensation and deductions.

- Skill: `knuckles-team/payroll-processing` (Agent Skill, multi-file: 2 files)
- Install (CLI): `npx skillmds@latest add knuckles-team/payroll-processing`
- Raw SKILL.md: https://api.skillmd.com/api/skills/knuckles-team/payroll-processing/raw
- Safety review: pending
- Works with: Claude Code, Claude.ai, OpenAI Codex
- Category: Coding & Dev Tools
- Author: Knuckles-Team (https://skillmd.com/u/knuckles-team)
- Updated: 2026-09-17
- Page: https://skillmd.com/skills/knuckles-team/payroll-processing

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# Payroll Processing Workflow

**CONCEPT:KG-2.12 — Company Operations Domain**

Bi-weekly or monthly payroll processing with full US tax compliance.
Routes tax calculations to data-science-mcp for computation.

## Steps

### Step 0: Query Payroll Data
**Agent**: `accounting-agent`
**Tools**: `graph_query`

Query the ERP system (via abstracted adapter) for:
- Active employees and their compensation bands
- Hours worked (for non-exempt employees)
- PTO usage
- Bonus/commission accruals
- Pre-tax deductions (401k, HSA, FSA)

### Step 1: Compute Tax Withholdings
**Agent**: `tax-calculator`
**Tools**: `data_science_mcp`

Route to data-science-mcp on heavy hardware for computation:
- Federal income tax (per W-4 configuration)
- State income tax (per state withholding form)
- FICA (Social Security: 6.2% up to wage base + Medicare: 1.45%)
- Additional Medicare tax (0.9% above $200K)
- FUTA/SUTA (employer-side)

### Step 2: FLSA Compliance Validation
**Agent**: `compliance-checker`
**Tools**: `graph_query`

Validate against US employment law:
- Minimum wage compliance (federal $7.25 + state minimums)
- Overtime calculation for non-exempt (1.5x for >40 hrs/week)
- Tip credit calculations (if applicable)
- Youth wage compliance
- Garnishment limits (Title III CCPA)

### Step 3: Execute Payroll
**Agent**: `payment-processor`
**Tools**: `graph_write`

Execute via ERP adapter:
- Generate paystubs
- Initiate direct deposits
- Create PayrollRecord nodes in KG for each employee
- Log tax liability accruals
- Generate payroll journal entries

### Step 4: Post-Payroll Reporting
**Agent**: `graph-os`

KG persistence:
- PayrollRecord nodes with full tax breakdown
- Link to Employee, PayPeriod, and CompensationBand
- Update KPIs: total payroll expense, effective tax rate, benefits cost ratio

## Output
- PayrollRecord nodes in KG for all employees
- Paystubs generated
- Direct deposits initiated
- Tax liability journal entries created
- Compliance validation report

## Human Oversight Required
✅ Financial signing authority required for payroll disbursement.

## Execution

Run this workflow as a dependency-ordered DAG. Steps with no unmet `depends_on` run in parallel; dependents run after their prerequisites complete.

- **Run first (in parallel):** Step 0 — Query Payroll Data; Step 1 — Compute Tax Withholdings; Step 2 — FLSA Compliance Validation; Step 3 — Execute Payroll; Step 4 — Post-Payroll Reporting

**Execution:** If graph-os is reachable, offload the whole DAG via `graph_orchestrate action=execute_workflow` (or the `kg-delegate` skill) for true parallel/swarm execution. Otherwise execute the steps natively in dependency order: run steps with no unmet `depends_on` in parallel, then their dependents.