This chapter provides an overview of extra periods and discusses how to:
Calculate extra periods.
View delivered extra period elements.
In Global Payroll for Spain, you define the details for the extra period payments as stated by the labor agreement on the Extra Period Definition page and the Extra Period Eligible Earnings page of the Labor Agreement component. These pages are discussed in another chapter in this PeopleBook.
See Defining Extra Period Data, Defining Extra Period Earnings.
This chapter provides additional information about calculating extra periods.
In addition to the 12 pay periods in a year, employees are eligible for two or more extra period payments, as defined by their labor agreements. Typically, most employees get extra period payments in June and December. Two extra period payments are the statutory minimum; however, a labor agreement may set a higher number. The amount of the extra period payment is also defined in the labor agreement.
Extra period payments can be prorated or paid as a single payment. For example, the labor agreement can specify that the first extra period payment is to be paid every month and prorated as 1/12 of the total amount of the extra period payment. The labor agreement can also state that the second extra period payment is to be paid as a single payment in December.
The base for calculating extra periods is defined in the labor agreement. For each extra period, you define the following:
Payment period and contribution timeframe.
The payment period is the month when the extra period payment is paid to the employees. The contribution timeframe is the period over which an amount is withheld. The contribution timeframe is defined with the Period From and Duration fields on the Extra Period Definition page. Prorated extra periods are automatically paid monthly throughout the year.
Earnings that are included in the extra period calculation, and the percentage of each earning.
Not all earnings contribute towards the extra period — only those on the Extra Period Eligible Earning page are included in the selected extra period. You can define extra period payments that are based on different earnings. For example, you might have two extra periods, one based on the employees' base salary and a second period based on the base salary plus the transportation earning.
Whether the payment is prorated or paid as a single payment.
Prorated extra periods are always based on the compensation for the processing period. Extra period payments that are not prorated are calculated in one of two ways:
Based on the employee's compensation during the payment period.
For example, if you define the extra period as January to June and the payment period is June, the system uses the employee's monthly compensation for June to calculate the extra period amount.
Based on the employee's compensation for each month of the contribution timeframe.
For example, if you define the extra period as January to June, the system uses the employee's monthly compensation for the months January to June, to calculate the extra period amount.
For employees whose salary is adjusted to gross or net, you need to define an overall extra period percentage.
This percentage is needed to get the target monthly salary from an annual amount. The annual amount is paid over twelve months plus the extra periods. You need to know if one extra period is equal to a regular payroll or just a part of it. If a labor agreement defines two extra periods, one defined at 100 percent and another defined at 50 percent, the factor used to find the monthly salary is 1/12 + 1.0 + 0.5.
See Understanding Gross and Net Guarantee.
When the extra period is calculated, the system checks employees' absence history and reduces the extra period payment for certain types of absences taken during the contribution timeframe.
There are two different ways of managing the effect of absences in extra period payment, depending on the calculation method selected in the Calculation Options group box on the Extra Period Definition page.
If you select Proration Lump Sum, the extra period payment is calculated during the regular payroll process but the withheld amount takes into account the unpaid days.
If you select Payment Period Compensation, the system stores in an accumulator the absence days that should be subtracted from the extra period payment (AUS AC D N PG XTRA).
When processing the extra period, the process determines the daily rate within the extra period timeframe for each earning and multiplies it by the extra period timeframe days minus the unpaid days.
The system checks the Take Config1 field in the absence take definition to determine if the absence affects the extra period payment.
In the case of advanced extra periods (those extra periods with payment dates that are prior to the timeframe end date), you can have absences that occur after the extra period has been paid. Those absence days need to be deducted at some point. Global Payroll for Spain provides a variable, CLI VR PRC DTO XTR (extra period deduction process option). This means that, those absences that occurred between an extra period payment period and the extra period timeframe end date will be deducted in the next extra period process. Values for the CLI VR PRC DT XTR are PXTRA (default value - deduct from the next extra period process), or MENSUAL (deduct from the current regular period).
See Defining User-Defined (TAKE CONFIG) Fields.
Example of a Calculation for Prorated Extra Periods
The labor agreement can specify that one of the extra period payments be prorated over the 12 regular payments during the year.
Note. Only one extra period payment can be prorated over the course of the year. If your requirements define more than one prorated extra period, you can use the Percent if Salary Adjustment field and the Earning Percent field to set that up.
Let's say that the labor agreement specifies three extra period payments a year: a flat amount to be paid in June and December and a prorated amount to be paid in 12 regular payments (monthly). The extra period payments are 1200 EUR each.
The prorated amount is calculated as follows:
1200/12 = 100 EUR per month
In the case of the prorated amount, an element called Prorated Extra Periods appears in the monthly payslips with a value equal to 100 EUR. This amount is accumulated over the gross and the taxable base, but not over the social security base, because the value of extra periods is considered in the social security base through the extra period proration.
Prorated extra periods are calculated by summing all eligible earnings and dividing by the duration (the extra period timeframe), in days, to obtain a daily rate. For daily employees the duration is 365 or 366 days, and for monthly employees, it is 360. This daily rate is then multiplied by the working days in the month. A prorated extra period is paid as a unique earning.
Partial Payments for Extra Period Earnings
When employees join a company in the middle of an extra period timeframe, they are paid for only the portion of the timeframe that they work. The system calculates the partial payment for the extra period earnings using a formula (XTR FM PXTR DVNGDA). The formula calculates a factor by dividing the number of worked days (during the extra period timeframe) by the total number of days in the extra period timeframe.
The calculation of the factor depends on an employee's social security contribution group type. Depending on whether his contribution group type is calculated daily or monthly, the calculation varies. The following are some formulas:
Daily contribution groups:
The timeframe is in calendar days. For example, for the timeframe from January to June, the calculation is the sum of all the calendar days in the months from January to June:
(31 + 28 + 31 + 30 + 31 + 30) divided by 181.
In this example, the factor is 181/181 = 1
Now, let's say that an employee is hired on January 15, rather than January 1. The timeframe is as follows:
(17 + 28 + 31 + 30 + 31 + 30) divided by the total number of days from January 1 to June 30 which is (167/181).
In this example, the factor is 167/181 = .9226.
Monthly contribution groups:
Let's say that you have an employee who is on a monthly payroll and his hire date is January 15. In this case, the days that must be considered month by month are 30, and you must calculate the proration for that month (January) in which the employee has not worked fully. So the calculation is as follows:
(16 + 30 + 30 + 30 + 30 + 30) divided by (30 * 6)
In this example, the factor is 166/180 = .9222.
There are two ways in which the system processes extra period pay when there is a termination in a month that corresponds to an extra period payment:
The system calculates the extra period for the terminated employee during the calculation of the extra period itself.
Later, the regular payroll process calculates termination pay (including loans, advances, vacations, and so on).
The system calculates the amount corresponding to the extra period during regular payroll processing as part of termination processing.
The corresponding amount for extra periods is paid through the LIQ PXTR XXX earnings as part of the regular payroll calculation. You exclude the terminated employee from extra period calculation.
See Also
Terminations and Extra Period Processing
This section discusses:
Delivered extra period earnings.
Delivered extra period deductions.
Delivered extra period process lists.
This table lists the extra period earning delivered in Global Payroll for Spain:
Earning |
Description |
PXTRA PRTDA |
Prorated extra period. The system calculates the extra period amount and then divides that amount by the number of days in a year (365 or 366 days for daily employees and 360 for monthly employees) to obtain the daily payment. To calculate the extra period amount, the system calculates the daily values of basic earnings considered in the extra period (provided by the labor agreement). The unit is the normal working days for the employee type (30 days for monthly employees or 28, 29, 30, or 31 for employees in a daily contribution group) minus any absence days that affect extra periods calculation. |
This table lists the extra period deduction delivered in Global Payroll for Spain:
Deduction |
Description |
DTO PXTR AUS |
Absence on an extra period that has already been paid. Generated as part of the extra period calculation (XTR PR PAGA EXTRA), to deduct those absence days that affect extra periods (TAKE CONFIG = 01) that have already been paid. This only occurs when the payment date of the extra period is earlier than the allocation end date. This deduction is also generated during the termination process (GEN PR CALC NOM) to discount absence days that affected an extra period that has already been paid. This deduction can be overridden by payee or positive input, and subtracts from the employee's gross amount (GEN C DEV BAS S). |
This table lists the extra period process lists delivered in Global Payroll for Spain:
Section |
Description |
GEN PR CALC NOM |
Regular payroll process including termination, salary adjustments, and prorated extra periods. For lump sum extra periods, the payroll process calculates the withheld amount and stores it in an accumulator that will be paid later in the extra period calculation. |
XTR PR PAGA EXTRA |
Extra period process. It only includes basic earnings sections, salary adjustments processing, and taxes. |
Extra periods are calculated and processed in two ways, depending on the type of extra period. Prorated extra periods are calculated in the normal process list, and extra periods that are not prorated are calculated in a separate process list (XTR PR PAGA EXTRA). The type of extra period (prorated or not) is defined when you specify the extra period for the labor agreement.
Note. The PeopleSoft system delivers a query that you can run to view the names of all delivered elements designed for Spain. Instructions for running the query are provided in the PeopleSoft Enterprise Global Payroll 9.0 PeopleBook.
See Also
Understanding How to View Delivered Elements