Enter your idea

The problem:
Xero Payroll does not currently allow reporting by Tracking Categories (e.g. by location, cost centre, or department). While Tracking can be applied to invoices and expenses, payroll reports (Pay Runs, Pay History, Payroll Activity, etc.) cannot be grouped or filtered in the same way.
For businesses with multiple locations under a single entity, this means payroll costs cannot be easily allocated to the correct branch. At present, the only workaround is to export payroll reports to Excel and manually tag employees, or rely on journal postings into the P&L.
What’s already set up
Employees can already be allocated to a group, location, or category in their employment information.
Payroll journals post to the General Ledger, but this doesn’t automatically pick up the employee’s group.
The structure already exists in Xero (Tracking Categories and Employee Groups) but payroll reporting doesn’t leverage it.

The opportunity:
If Payroll reporting allowed filtering or grouping by Tracking Category or Employee Group:
Businesses with multiple locations could instantly see payroll costs per location without manual exports.
This would make P&L by Tracking far more accurate and remove the need for rework each pay run.
It would align payroll reporting with how invoices/expenses already support Tracking.
It would help multi-site businesses establish their true wage % per location — a critical metric.
Suggested solution
Add the option to select a Tracking Category for each employee in Payroll Settings.
Enable Payroll Reports (Payroll Activity, Pay History, etc.) to be filtered or grouped by that category.
Ensure payroll journals automatically pick up the assigned category per employee.
Impact
This would be a huge time-saver for any business with multiple locations, cost centres, or departments. It would give a true picture of labour costs per unit without the need for spreadsheets or third-party apps.