How payroll works with Cocoon
Cocoon Support avatar
Written by Cocoon Support
Updated over a week ago

Cocoon performs the payroll calculations, but your internal Payroll team is still responsible for running payroll.

Employees may have multiple income sources during leave

During an employee’s leave, pay may come from a variety of sources. Depending on their location, leave type, and tenure this may include pay from their employer, Private Disability, State Disability, and State Paid Family Leave programs. These sources work together to ensure an employee receives full pay during their leave–meaning only a portion of their leave pay may come from their employer directly. Cocoon’s software automatically identifies any claims an employee is eligible for and guides them from the submission process. Any applicable claims must be submitted in order for employees to receive full pay during leave. Coordinating across multiple income sources can be confusing, which is why Cocoon’s software automatically calculates how much each employee should be paid on leave.

Cocoon’s software calculates employee leave pay on your behalf, by taking into account all applicable income sources and their requirements:

  • Tenure

  • Maximum weekly benefits from benefit entities

  • Waiting periods

  • Employer top up pay

Cocoon calculates payroll using the Estimation Method

Cocoon’s software will automatically estimate the amount of benefit payments that an employee will receive from state or disability programs based on their leave plan. These estimates are calculated from published daily rates and weekly benefit maximums from benefit programs. Employers will receive pay files for employees on leave with these estimates already applied, meaning employers will pay their employees less than usual during leave. Learn more about the Estimation Method here.

Employers are responsible for giving Cocoon information in so our system can accurately calculate pay

Learn more about employer responsibilities for running payroll here.

Pay schedules

Employers provide their pay schedule during onboarding with Cocoon which highlights:

  • Start Date

  • End Date

  • Pay Date

Employers indicate how many days in advance they’d like to receive the pay files from Cocoon before their pay date (e.g. 5 business days). You can view these settings in the HR & Payroll system page in your dashboard.

We’ll also highlight when you can expect your next pay file in your Documents tab.

Census files

Cocoon needs up-to-date census files in order to accurately calculate pay. Ahead of Cocoon’s pay file deadline for your team, Pay Admins will receive an automated reminder email to upload a new census in the Cocoon dashboard. Learn more about the importance of the census here.

Payroll Files

On the due date listed in the Documents tab, Cocoon will publish your pay files. These pay files will include the gross pay amount and any applicable deductions for state or private disability benefit payments issued to employees. This ensures that your company will only be topping up employee pay which was not paid out by these other sources.

Depending on the payroll system your company uses, the payroll file that Cocoon sends over may look slightly different. Learn how to read your pay file here.

Pay Admins

Cocoon has three different roles for admins: Workspace Admin, Pay Admin, and Member.

Pay Admins can:

  • Upload a census

  • Download pay files

  • View admins and which roles they have

  • View all employee leave data

Pay Admins will receive notifications for the following:

  • Pay emails (e.g. census file is due, pay file is ready, excess employer benefits)

Learn more about roles here.


Questions? Please reach out to the Cocoon Support team at:

Did this answer your question?