---
{
	"_label": "Human Resource Setup"
}
---
The HR module has a setup process where you create the masters for all the major activities.

### Organization Setup

To setup your Employee master you must first create:

- Employment Type (like Permanent, Temp, Contractor, Intern etc).
- Branch (if there are multiple offices).
- Department (if any, like Accounting, Sales etc).
- Designation (CEO, Sales Manager etc).
- Grade (A, B, C etc, usually based on seniority).

### Leave Setup

To setup Leaves, create:

- Leave Type (like Sick Leave, Travel Leave etc)
- Holiday List (list of annual holidays for the year - these days will not be considered in Leave Applications).

### Payroll (Salary) Setup

In ERPNext, salaries have two types of components, earnings (basic salary, expenses paid by the company, like telephone bill, travel allowance etc) and deductions (amounts deducted for taxes, social security etc). To setup payroll, you must first setup all the different types of earnings and deductions. These are

- Earning Type
- Deduction Type

These are just labels, we will see how to use them when we discuss the payroll section.