Defining Country Data

This chapter provides overviews of PeopleSoft Human Resources setup considerations, Global Payroll core functionality in the Netherlands, and discusses delivered process lists and sections.

Understanding PeopleSoft Human Resources Setup Considerations

This section discusses:

• Human Resources Administer Salaries for the Netherlands functionality.

• Organizational level setup in the Netherlands.

Human Resources Administer Salaries for the Netherlands Functionality

The Administer Salaries for the Netherlands functionality has been designed primarily for customers using Human Resources with PeopleSoft Enterprise Payroll Interface. If you are using Global Payroll for the Netherlands, you should use the designated functionality found in Global Payroll for the Netherlands, and not the functionality found in Administer Salaries for the Netherlands.

This includes setup and assignments for earnings and deductions, enrollment into benefits, and setup and administering social insurance and tax data.

With Global Payroll for the Netherlands, you will set up the designated functionality through the Set Up HRMS, Product Related, Global Payroll & Absence Mgmt menu path. You'll administer the functionality through Global Payroll.

Information on how to set up and administer these business processes can be found in the business process chapters of this PeopleBook.

Organizational Level Setup in the Netherlands

When setting up information for your organization, three elements are important for payroll processing:

• Employer tax ID (Loonbelastingnr werkgever) - Company level.

• Social security number (Aansluitnr UWV) - Establishment level.

• Social fiscal number (Sofinummer) - Employee level.

The employer tax ID uniquely identifies the company to the Tax Authority and is defined at the company level. You can record the employer tax ID on the Company Table in Human Resources.

The social security number uniquely identifies the company to the Social Security agency and is defined at the establishment level. A Dutch company can have several establishments which share the same social security number. You can record your company's social security number on the Social Security pages in Global Payroll for the Netherlands.

Employees in the Netherlands are uniquely identified through their personal social fiscal number. Each employee can only be registered under one social security number and one tax authority number ID per employment. These registration numbers are derived from an employee's job record in Human Resources.

See Also

Payment Keys

Setting Up Social Security Contributions

Setting Up Organization Foundation Tables

Understanding Global Payroll Core Functionality in the Netherlands

This section discusses:

• Earning and deduction assignments.

• Retroactivity.

• Payment keys.

• Accumulators.

• Rounding rules.

• Proration.

• Segmentation.

• Triggers.

Note. Information on suffixes used in Global Payroll for the Netherlands is discussed previously in this PeopleBook.

See Also

Understanding Global Payroll for the Netherlands

Proration of Earnings and Deduction Assignments

Global Payroll provides two options for determining whether payee earning and deduction assignments are processed within a given period:

• If the assignment is active at the segment end date.

  If you select this option, earnings and deductions are processed if they are assigned to an employee at the end of the segment only. Any assignments that end between the segment begin and end dates are not processed.

• If the assignment is active at any time between the segment begin and end date.

  If you select this option, earnings and deductions that are assigned to an employee for all or part of the segment are processed.

This setting is configured for each country on the Countries page (Set Up HRMS, Product Related, Global Payroll & Absence Management, System Settings, Countries). The Netherlands is configured to process earning and deduction assignments that are active at any time within the segment.

To support this configuration, Global Payroll for the Netherlands also delivers a segmentation trigger for the earning and deduction assignment record (GP_PYE_OVRD). This trigger is required for element segmentation (and proration) of earnings and deductions that are assigned for part of the segment. See the Segmentation section later in this chapter for more information.

See Also

Setting Up Segmentation Triggers for The Begin and End-Dated Earning and Deduction Assignment Record (GP_PYE_OVRD)

Segmentation Triggers with Earning and Deduction Assignments

Defining Installation Settings

Retroactivity

Retroactivity is the process of going back in time and recalculating prior calendars because changes occurred after the original calculation was run. When retroactive processing occurs for a payee, the system recalculates each element generated for the payee. The difference between these results is the retro delta.

In Global Payroll, there are two methods for calculating retro:

• Corrective

• Forwarding

With the corrective method, the system recalculates the elements of a pay run and updates all balance accumulators and segment accumulators. This results in a complete recalculation of the pay run for that calendar period. The recalculated pay run replaces the previously calculated run. However, the original pay run calculation remains available for auditing and reporting purposes.

With the forwarding method, the system recalculates payments in the respective periods, but does not update balance accumulators for the period. It updates only the segment accumulators. The system creates deltas for each earning, deduction, and segment accumulator used in the process list. It forwards these deltas, which are identified on the Retro Process Override page, to the current period.

Note. In Global Payroll for the Netherlands, the standard retro method is corrective.

The system generates a retro trigger every time you enter a change for the following data.

Changes in Employee Data

Changes in employee data include compensation rate-related changes:

• Status.

• Compensation frequency.

• Standard hours.

• Pay system flag.

• Action for retroactive hire.

• Action for retroactive termination.

Changes in Other Data

Changes in other data include absence take-related changes:

• Positive input

• Overtime

• Pay group

The system recalculates earnings and deductions and a difference results.

Note. Not all earnings and deductions will have an adjustment for retro. Some of the earnings and deductions are forwarded to one earning or deduction, which then appears as a single adjustment in the current period.

Retro Setup

To set up retro:

1. Define a default retro method (corrective or forwarding).

2. Define a retro process.

   This includes defining retro overrides and trigger event IDs. In Global Payroll for the Netherlands, the country is set to NLD and the retro process definition ID is set to RETRO.

   Note. You may need to define retro overrides in case you need to set up an exception handling in case retro occurs across year-end, in which case, the balances in the previous year should not be updated. Instead, the deltas should be forwarded to the current year.

3. Define triggers.

   This includes specifying backward and forward retro limits and retro triggers. In Global Payroll for the Netherlands, the country is set to NLD and the retro process is set to RETRO.

Note. When using forwarding retro, you must define the action to be taken on deltas.

The Retro Calculation Process in the Netherlands

Typical situations in which retro calculation may occur in the Netherlands include:

• When salary increases go into effect retroactively.

  Let's say that an employee's current base salary is 5000 EUR. In April, the employee receives a salary increase of 250 EUR, but the new salary of 5250 EUR does not go into effect until June. In July, the employee gets paid 750 EUR (three months * 250 EUR) retroactively in addition to the new base salary of 5250 EUR.

• When incorrect time data is found or the amount of variables is entered by mistake after the salary payment, the system settles difference in the next pay period.

  Let's say that you entered the overtime for an employee in May as 10 hours and 30 minutes. On the May payslip, there was an overtime payment of 315 EUR. After May, you discover a mistake in the time data and realize that the actual overtime was 9 hours and 30 minutes. Overtime was overpaid by 30 EUR in May, and this will be deducted from the employee's June salary as the adjusted amount of overtime pay.

• When there are changes to the job status, tax data, or social security contributions, there may be some retroactive impact on the payroll calculation.

Processing Statutory Deductions after a Retro Calculation

Whenever a retro calculation occurs, the amount of statutory deductions, such as taxes and insurance premiums, should be processed as follows:

• Income tax

  The amount of taxable retroactive pay is considered part of the salary paid in the actual payment month. The system calculates the amount of withholding income tax by adding the amount of taxable retroactive pay to the total amount of taxable salary. The amount of withholding income tax due to retroactive pay is settled at year-end adjustment.

• Social security

  Retro calculations do not influence the amount of health insurance premium deductions and employee social security premiums. However, due to the retro pay amount of standard remuneration, you may need to occasionally revise this calculation.

Reporting Retro Results on the Payslip

Global Payroll for the Netherlands enables you to configure the payslip to show retro in different ways. You can choose to print only current results, only retro results, or both the current and retro results on a payslip.

See Retro and Payslips.

See Also

Defining Retroactive Processing

Setting Up Triggers

Payment Keys

You define payment keys for pay entities and use them with forwarding retro. If your business rules require the use of payment keys, you can set them up in Global Payroll for the Netherlands. You can have up to four payment keys per pay entity. Valid options are Company, Contract number, Department, and Establishment ID.

When a payment key exists for the recalculation period and the deltas are being forwarded to the current period, the system keeps the retro delta data separate in the current pay period. This allows the system to run a separate gross-to-net calculation in the current pay period for that set of payment keys, thereby creating an additional GP_PYE_SEG_STAT record.

Here's an example of using payment keys:

Let's say that you define “Company” as a payment key. A payee working in Company A moves to Company B in the current period. There is retro going back to a prior calendar when the payee was in Company A and there are adjustments to the payee's current period coming from the prior calendar. The adjustments are associated with Company A and the current period is associated with Company B. In this situation, the adjustments are managed as separate gross-to-net in the current period.

Note. In the Netherlands, you need to keep track of the employer tax number at the company level, and the social security number at the establishment level. When using forwarding retro, the company and establishment entities need to be used as payment keys in order to report the forwarded deltas under the correct registration number.

See Also

Defining Retroactive Processing

Organizational Level Setup in the Netherlands

Accumulators

In Global Payroll, there are two different types of accumulators:

• Auto-generated accumulators.

  These accumulate a particular element during a defined period (payment accumulators).

• Non auto-generated accumulators.

  These accumulate different elements as user definition (balance accumulators). You define these for any period of time for which you want to accumulate any number of elements.

You can indicate when the accumulator is going to be updated in the following ways:

• As contributing: when the system resolves a member.

• As encountered: when the system finds the accumulator in the process list.

• After calculation: during the process, the value of the accumulator is its original value.

In Global Payroll for the Netherlands, there are several categories for delivered accumulators:

• BEL AC BSREG STHB – (Segment Base Regular).

  This is a base containing all delivered regular earnings and deductions.

• BEL AC BSCRG STHB – (Customary Base Regular).

  This is a placeholder for user-defined regular earnings and deductions.

• BEL AC COLxxx – (Non-regular earnings).

  Model Loonstaat columns for reporting.

• BEL AC AANGxxx – (Non-regular earnings).

  Aangifte Loonbelasting reporting.

• SOC AC AFD xxx.

  Social security accumulators for the total contribution per insurance of the employer to the social security agencies.

• SOC AC INH xxx.

  Social security accumulators for the employee contribution per insurance.

• AFW AC xxx.

  Accumulators for tracking the different day counts, like scheduled work days, actual work days, and hours.

• VER AC xxx

  Accumulators for tracking specific earnings and deductions (see the following table for some examples)

Global Payroll for the Netherlands delivers these accumulators:

Note. All of these delivered accumulators use EMPLID as the Key, and are recorded on the calendar as Period End Date. The system resolves the year-to-date accumulators and those for reporting purposes After Calculation. The system resolves the accumulators that are used as Base for further calculations mostly when the members are contributing.

See Also

Setting Up Accumulators

Rounding Rules

Global Payroll for the Netherlands uses standard rounding rules provided by the core application. By default, Global Payroll for the Netherlands does not round intermediate results, but rounds the end results of an employee's net pay to at least two decimals, using the rounding rule GP ROUND NEAR 2DEC provided by Global Payroll.

Global Payroll for the Netherlands also has some special rounding rules for Dutch taxes. When calculating regular taxes for an employee, you can round down the annual taxable base if appropriate.

See Also

Defining Rounding Rule Elements

Withholding and Reporting Taxes

Proration

A proration is the process by which the system takes a calculated result and applies a coefficient to it. This coefficient factor is defined as a subset of the total pay period, such as a slice or segment period, over the total pay period. This process is closely tied to segmentation.

The way proration is defined is to create a numerator for the proration factor and a denominator. The only elements that can be used in either the numerator or the denominator are accumulators, counts, formulas, or variables. Proration only occurs on amount, base, or units.

Global Payroll delivers the following proration rules:

• Proration based on calendar days.

  This calculates the number of calendar days in the segment or slice over the number of calendar days in the period.

• Proration based on workdays.

  This calculates the number of working days in the segment or slice over the number of working days in the period.

• Proration based on work hours.

  This calculates the number of working hours in the segment or slice over the number of working hours in the period.

Note. In general, Global Payroll for the Netherlands uses proration based on workdays.

The following proration rules are delivered with Global Payroll for the Netherlands:

• For a pay period: ALG PR HUIDIGE PER (Standard Days of Work).

  This proration rule has a numerator, which is a count element, AFW AC WRKD DAYS (Standard Days of Work per Period) and a denominator, which is a variable element, AFW AC WRKNG DAYS (Actual Days of Work per Period).

• For hours: ALG PR UREN PER (Standard Hours of Work).

  This proration rule has a numerator, which is a count element, AFW AC WRKD HRS (Standard Hours of Work per Period), and a denominator, which is a variable element, AFW AC WRKNG HRS (Actual Hours of Work).

Examples: Proration in the Netherlands

The following are two examples using proration in the Netherlands:

• An employee joins the company on January 7, 2002.

• Base salary is 3000 EUR.

• January 2002 has 23 working days.

To calculate this employee's pay for January, use the following formula:

• Actual days worked/Number of working days in January* Monthly base salary = Employee pay.

• 19 / 23 * 3000 EUR = 2478,26 EUR.

Here's another example of proration calculation:

• Employee is entitled to a 1000 EUR allowance for the month of April, effective April 12, 2002.

• April 2002 has 22 working days.

To calculate this allowance, use the following formula:

• (Days between April 12 and April 30)/(Number of working days in April) * Allowance = Actual allowance.

• 13/22 * 1.000 = 590,91 EUR (rounded by two decimal places).

See Also

Defining Proration Rules

Segmentation

In Global Payroll, if there is a change to employee details within a pay period that might affect calculation, such as a pay rate increase, the calculation creates two slices. One slice uses the details before the change and the other slice uses the details after the change.

Global Payroll provides two types of segmentation:

• Period segmentation (full segmentation).

• Element segmentation (slice segmentation).

Period segmentation occurs when more than one gross-to-net calculation is required. Element segmentation occurs when there is a change in the rate that affects the calculation of one or more elements. In other words, element segmentation occurs when you want to calculate a select set of earnings or deductions multiple times, but not the entire gross-to-net calculation.

In Global Payroll for the Netherlands, examples of period segmentation triggers are job action changes, such as hires or terminations, or organizational changes, such as transfers between companies, establishments, or pay groups.

Segmentation Trigger For Earning and Deduction Assignments

Global Payroll for the Netherlands delivers a segmentation trigger for the earning and deduction assignment record GP_PYE_OVRD. This enables you to assign an earning or deduction to a payee on the Element Assignment by Payee (GP_ED_PYE) or Payee Assignment by Element (GP_ED_ELEM) components, and segment (and prorate) the element when the assignment begin date comes after the pay period begin date, and/or the assignment end date comes before the period end date.

Modify the delivered trigger definition and associated segment event definition to add your earnings and deductions and supporting elements.

See Also

Proration of Earnings and Deduction Assignments

Defining Segmentation

Defining Proration Rules

Triggers

Triggers are used to detect online changes to data that should result in some type of system action. Examples of common data changes that might use triggers include a new employee hire, a change in pay rate, or a change in job location.

Global Payroll provides three types of triggers:

• Iterative – tells the system to process (or reprocess) an employee for the current period.

• Segmentation – tells the system to segment a period or element.

• Retro – tells the system to perform retro processing.

Note. Before you can use a trigger to process a payee, perform segmentation, or perform retroactive processing, you must first set up a trigger to tell the system when an event occurs; it should perform the desired action.

Global Payroll for the Netherlands delivers some triggers, however, you can alter these depending on your business needs.

All triggers in Global Payroll for the Netherlands are defined as NLD_[RECORD NAME].

Delivered Triggers

The following is a list of triggers that are delivered with Global Payroll for the Netherlands:

See Also

Setting Up Triggers

Delivered Process Lists and Sections

This section discusses:

• Delivered process lists.

• Naming conventions for delivered sections.

Delivered Process Lists

This table lists the delivered process lists for the Netherlands:

Naming Conventions for Delivered Sections

The delivered process lists for the Netherlands contain sections with the following categories and prefixes:

• BELxxx – for taxes.

• VERxxx – for earnings and deductions.

• SOCxxx – for social security.

• AFWxxx – for absence processing.

The INIT section is used for initialization, such as for loading data from setup tables to prepare for calculation.

Note. Delivered sections for the Netherlands are listed in the business process chapters of this PeopleBook.

Note. PeopleSoft delivers a query that you can run to view the names of all delivered elements that are designed for the Netherlands. Instructions for running the query are provided in PeopleSoft Enterprise Global Payroll 9.1 PeopleBook.

See Also

Viewing Delivered Elements

Defining Earning and Deduction Elements