Many earnings and deductions - such as salary, pension deductions, and taxes - are discussed under specific functional headings, such as Salary and Grade Related Pay, or Savings and Retirement, or Payroll Statutory Deductions. In this area, we look at payroll earnings and deductions, such as wage attachments, that have not already been covered under other functional headings.
We also focus on additional setup required by Oracle Payroll for processing earnings and deductions. This setup includes the creation of formulas and balances. In some localizations, and for certain types of earnings and deductions, you can select template elements in the Configuration Workbench, or you can use the Element Design Wizard or template windows to generate all the components required for payroll processing, including elements, formulas, balances, and formula result rules.
Certain types of earnings and deductions require additional setup to enable special processing such as net-to-gross and proration, where this is enabled for your localization. Such setup is also discussed in this section.
Note: Mexico only: Oracle HRMS for Mexico does not support net-to-gross processing.
To get the most out of the earnings and deductions functionality of Oracle HRMS, you need to understand the following key concepts:
Pay values
Formulas
Frequency rules
Payroll balances
Earnings and deductions templates
Proration
Net-to-gross processing
Third party payments
Oracle HRMS provides an integrated solution for Human Resources and Payroll. Therefore your setup of compensation and benefits supports both compensation management and payroll management.
Yes it can, through its use of formulas to specify calculations for each earnings or deduction. These formulas use values from the HRMS database and can include conditional logic to perform different calculations for different groups of employees. For example, they can check balances or employee status to control how to process the earning or deduction. Many of the formulas you need, for example for tax calculations, are supplied with Oracle Payroll.
The sequence of processing in a payroll run is determined by classifications, such as Pre-tax Deductions and Tax Deductions. You can also prioritize the processing for an individual employee, for example to determine the order in which deductions are processed for wage attachments.
You control whether any value is processed just once, in every payroll run, or periodically (such as once a quarter). Your formulas can also change or stop the processing of an earning or deduction during a run, based on employee status.
The system can accumulate balances of payroll run results or values entered before the run. You can accumulate a balance over different time dimensions such as current run, month, and year to date. You can review balances after payroll processing and use balances to control the processing performed in the payroll run.
Yes, you can define whatever additional balances your enterprise requires. For example, you may require a Pensionable Earnings balance for a defined benefit pension plan your enterprise offers employees.
Some values, such as salary, can be entered once and used in every payroll run (or periodic runs) until you need to update them. Other values, such as hours worked, need to be entered or calculated fresh for each run.
You can do one of the following:
Use default values (which may be different for groups of employees)
Enter values employee-by-employee
Enter values in a batch
Leave it to the system to enter values based on calculations performed during the payroll run
You can define validation rules to minimize data entry errors.
The wage attachments that you can process depend on the specific payments that apply to your legislation. Examples of payments include child support payments, educational loans, taxes to local authorities, alimony, and bankruptcy orders.
See: Third Party Payment Deductions, Oracle HRMS Compensation and Benefits Management Guide
Oracle Payroll supports electronic funds transfer (EFT) of state child support garnishments for the state of Illinois. However, all states accept the Oracle EFT format, but normally require different data dependent upon individual state requirements. You can use the Illinois EFT format to send support payments electronically to all states. You need to include only the information required by the state in the file. You create a separate file for each state containing different routing and account numbers, so you need to set up a separate third party payment method for each state.
Using Wage Attachment Earnings Rules you can determine which earnings types are considered disposable income and liable for wage attachment deductions.
You can determine the overall priority of a wage attachment compared to other deductions, and you can also determine sub priorities. For example, if an employee has multiple court orders against them, you can ensure that Oracle Payroll deducts the most important order first.
The standard processing priority order for processing the various categories of attachment is the following:
Bankruptcy orders
Support orders effective before federal tax levies
Federal tax levies
Support orders effective after federal tax levies
State tax levies (not supported by Oracle Payroll)
Credit garnishments
All other attachments
If enabled for your localization, you can use Oracle Payroll's Cheque Writer features to produce cheques for either organizations or individuals. Localizations that do not have Oracle Payroll's Cheque Writer features available can make payments by credit transfer.
You can use an external system to manage your wage attachments. If you want to make entries from that system into Oracle Payroll for payroll processing, you can use predefined deductions that come with Oracle Payroll.
Oracle Payroll fully supports the federal overtime calculation rule. The new functionality performs calculations for periods that are longer than a single workweek. You can configure the product to handle either Federal FLSA or State FLSA. You can also configure alternative overtime calculations as specified by selected states or by union contract.
Oracle Payroll uses the term Augments to refer to amounts paid which are in addition to the employee's regular rate of pay and which are considered to be non-discretionary, such as a commission or bonus. The new functionality prorates the augment across all periods during which it was earned.
If you select "Yes," then a standard link is created and all employees are automatically enrolled in this element upon hire.
In the Element Design Wizard, select one of the following options:
Always eligible (Final Close): Select this option when you want the element entries to stay open beyond the employee's leaving date so that you can continue to pay the employee.
Employment Termination date (Actual Termination): Use this option if you want recurring entries to close down on the date the employee leaves. For a nonrecurring element, select Actual Termination if you want the entries to close down at the end of the pay period in which the employee leaves, or on the date the assignment ends (the final process date).
First pay period after termination (Last Standard Process): Use this option for all recurring and nonrecurring elements if you want their entries to close down on the Last Standard Process date or on the date the assignment ends (the final process date) if this is earlier. The Last Standard Process date defaults to the last day of the pay period in which the employee is terminated, but you can set it to a later period when you terminate an employee.
In the Element Design Wizard, select one of the following options:
Automatically recur (Recurring): Select Recurring if an entry of this element applies in every period until the entry is ended.
Entered each pay period (Non Recurring): Select Non Recurring if an entry applies in one pay period only.
In the Element Design Wizard, if you select "Yes" and run two regular runs in the same period, the element will only be picked up once.
In the Element Design Wizard, select "Yes" for elements like "Time Entry" where an employee can have multiple entries in a single period. Select "No" for earnings like "Regular Salary."
These rules determine the pay periods in which the element is paid or withheld. For example, a monthly deduction might be processed in the third period of the month for weekly-paid employees and in the second period of the month for employees paid on a semi-monthly basis.
Oracle HRMS provides you with the ability to define all typical earnings and deductions needed to administer payroll, using a browser-based wizard. This classification and secondary classification model determines element behavior.
Note: You can only define new elements with this wizard. You cannot delete, update, or query for existing elements.
You must choose a calculation rule for each element you define. The rules that are available for earnings elements are: Flat Amount, Hours * Rate, Percentage of Earnings, and Days * Rate.
When defining deductions elements, you can choose to withhold a flat amount or a percentage of eligible earnings each pay period.
Note: HRMS elements do not support by default:
Special inputs
Skip rules
Oracle HRMS has replaced these features with new functionality (such as run types and pay value overrides).
When you define an element through this wizard, it automatically creates the following characteristics:
Balance Attributes (for Balance Reporting)
Element Extra Information Types (for IDW)
Secondary Classifications
Frequency Rules
You assign each element with a classification. You can do this through the Element Design Wizard.
For earnings elements, the classifications are:
Earnings
Supplemental Earnings
Imputed Earnings
Amends
Non-payroll Payments
For deduction elements, the classifications are:
Pre-tax Deductions
Tax Deductions
Involuntary Deductions
Voluntary deductions
See also: Survey of the Classifications
You must choose a calculation rule for each element you define. The rules that are available for earnings elements are:
| Calculation Rule | Description |
|---|---|
| Days * Rate | For earnings that are based on a daily rate. The result is derived by multiplying the number of days with the daily rate. The number of days and the daily rate can be specified on the element entry. If left blank, the number of days is derived from the employee's work schedule and the daily rate is derived from the employee's salary proposal. |
| Flat Amount | Pays the amount specified on the "Amount" input value. |
| Hours * Rate | For earnings that are based on an hourly rate. The number of hours and the rate can be specified on the element entry or can be derived from the work schedule and the salary proposal. |
| Percentage of Earnings | For earnings that are calculated as a percentage of another balance. This balance is defaulted to the employee's normal pay as defined through salary administration. |
Christmas Saving: Percentage of Earnings
Christmas Saving is a deduction from the employee calculated as a percentage of gross earnings. At the end of the year, the "Saving Box" distributes the funds back to the employee with interest. The "Saving Box" is a saving fund selected by the employees, which is different from the formal "Saving Fund" which is administrated by the employer.
If an employee authorizes a 5% deduction for Christmas Saving, and they are paid semi-monthly with gross earnings for the period of $5,000.00, the Saving Box input value would be 5.00. The deduction amount would be $250.00.
The available deduction calculation rules are:
| Calculation Rule | Description |
|---|---|
| Flat Amount | Creates deductions that deduct the amount specified on the "Amount" input value. |
| Percentage | For deductions that are a percentage of eligible earnings. The percentage is specified on the element entry. The eligible earnings are defined by feeding the eligible comp balance for the deduction. |
See also: Amount Rules for Earnings and Non-Payroll Payments and Calculation Rules for Deductions
The wizard helps you specify the following attributes for earnings elements:
| Attribute | Description |
|---|---|
| Base Compensation | You can use Historic Rates to group elements into Rate Types. Use this field to indicate if the element is a part of the delivered Base Pay rate type. Oracle HRMS uses Base Pay to derive other earnings like Christmas Bonus and Vacation Premium. Oracle HRMS determines the ordinary monthly salary for an employee using this Historic Rates functionality and the Base Pay rate type. You identify the elements that contribute to an employee's base salary by setting the Base Compensation field to "yes." Oracle HRMS uses Base Salary to the compute the employee's monthly pay, which is needed to compute the ISR tax on Amends as well as non-periodic earnings. See: Historic Rates |
| IDW Type | Use this field to indicate if the earning should be considered as Fixed or Variable for IDW purposes. See: Integrated Daily Wage Overview, Oracle HRMS Payroll Processing Management Guide |
| Time Dimension | Use this field to specify one of the following calculation frequencies:
Oracle HRMS uses this to convert the value into a daily amount for IDW purposes. |
| Pay Source Value | Use this field to specify how the IDW value for this element is derived. |
| Qualifier | Use this field to specify the name of the element, rate type, or input value from the Pay Source Value field to be used in IDW. |
| Calculation Type | Use this field to specify if the IDW value for the element is derived as a percentage or multiple of the pay source value specified earlier. Use this field only if you selected element or rate type as the pay source value. |
| Calculation Value | Use this field to specify the value of the percentage or the factor to be applied to the result if you have selected a value for the calculation type field above. |
| CFDI Payslip Code | Use this field to specify the CFDI Payslip Code. This information is mandatory for each element as the XML payslip will be invalid, if any element which is present in the XML payslip does not have the CFDI Payslip code. For elements, you can enter the CFDI Payslip Code using the Element Description, Further Information window. See Setting up Information for CFDI Payroll Payslip XML Interface, Oracle HRMS Payroll Processing Management Guide (Mexico) for more information. |
| CFDI Overtime Hours Type | Use this field to specify the CFDI Overtime Hours Type. Although this field is available for all elements with the Calculation Rule Hours X Rate in the Element Design Wizard page, use this field only for Supplemental Earnings with the secondary classification Overtime or Other Overtime. This information is mandatory for each element as the XML payslip will be invalid, if any element which is present in the XML Payslip does not have the CFDI overtime hours type. For existing elements, you can enter the CFDI Overtime Hours Type using the Element Description, Further Information window. See: Setting up Information for CFDI Payroll Payslip XML Interface, Oracle HRMS Payroll Processing Management Guide (Mexico) for more information. |
Oracle HRMS uses the following additional attributes to capture information relating to the processing of the element:
| Attribute | Description |
|---|---|
| Includes Rest Days | This attribute is available only if you selected the "Days * Rate" calculation rule. Select "Yes" if rest days are included in the calculation of the daily rate and the number of days. If an employee earns 350.00 MXP per week and "Yes" is selected, the daily rate is calculated as 50.00 MXP because it calculates the rate based on 7 days and 70.00 MXP The value is stored under the Further Element Information flexfield. |
| Tax Processing Type | Use this field to specify how tax rules should be applied to earnings.
|
| Eligible Worked Days for PTU | This attribute is available only if you selected the "Days * Rate" calculation rule. Select "Yes" for those earnings whose days balance should be included in the profit sharing calculation. |
The wizard helps you specify the following attributes for deductions elements.
See: Deductions Overview
The following options are available:
Arrearage and No Partial Deduction
The employee only earns commissions, which can vary and is paid weekly. In this example, the employee is scheduled to have a $300 deduction called Deduction "A" to be taken.
| Week | Gross Earnings | Taxes | Deduction A | Net Pay |
|---|---|---|---|---|
| 1 | 1,200.00 | 400.00 | 300.00 | 500.00 |
In the next payroll period, the employee earns only $300.00. The scheduled deduction of $300 is NOT taken and is placed into arrears.
| Week | Gross Earnings | Taxes | Deduction A | Net Pay |
|---|---|---|---|---|
| 2 | 300.00 | 100.00 | 0.00 | 200.00 |
In week number 3, the employee earns enough for the current $300 Deduction "A" and the arrearage amount from week number 2.
| Week | Gross Earnings | Taxes | Deduction A | Net Pay |
|---|---|---|---|---|
| 3 | 1,200.00 | 400.00 | 600.00 | 200.00 |
Arrearage and Partial Deduction
Employee is paid weekly and has a deduction called Deduction "B" in the amount of $300.00 per week.
| Week | Gross Earnings | Taxes | Deduction B | Net Pay |
|---|---|---|---|---|
| 1 | 1,000.00 | 200.00 | 300.00 | 500.00 |
In week number 2 the employee's earnings after taxes are withheld is $225.00. Oracle Payroll deducts this amount and places $75.00 in the arrears balance.
| Week | Gross Earnings | Taxes | Deduction B | Net Pay |
|---|---|---|---|---|
| 2 | 300.00 | 75.00 | 225.00 | 0.00 |
Week number 3 shows the regular scheduled Deduction "B" of $300 plus an additional $75 to make up the shortage from week number 2.
| Week | Gross Earnings | Taxes | Deduction B | Net Pay |
|---|---|---|---|---|
| 3 | 1,000.00 | 200.00 | 375.00 | 425.00 |
Error on Arrearage
No Arrearage and No Partial Deduction
No Arrearage and Partial Deduction
Employee has $1,000 in earnings, Deduction D for $300 (Deduction D defined as No Arrearage, but "Yes" take a Partial Deduction) Union Dues for $300 and Uniform deduction for $100.
Union Dues and Uniform Deductions are deducted before Deduction "D".
| Week | Uniform | Deduction D | Net Pay | |||
|---|---|---|---|---|---|---|
| 1 | 1,00.00 | 315.00 | 300.00 | 100.00 | 285.00 | 0.00 |
In week number 2 Employee has $1,350 in earnings. Oracle Payroll will deduct the regular scheduled amount for Deduction "D". No additional entry for the week number 1 difference of $15 is taken.
| Week | Gross Earnings | Taxes | Union Dues | Uniform | Deduction D | Net Pay |
|---|---|---|---|---|---|---|
| 2 | 1,350.00 | 467.00 | 300.00 | 100.00 | 300.00 | 183.00 |
The deduction stops for an employee when a balance of the amount taken for the deduction reaches a specified amount.
Used to identify the element as an INFONAVIT element and is required for inclusion of INFONAVIT information on Social Security reports and the SUA Interface.
Set the INFONAVIT field to "Yes" to generate additional input values required for tracking INFONAVIT related information.
The following input values would be created when the value of 'INFONAVIT' segment is 'Y':
| Input Value | |
|---|---|
| Credit Number | Number |
| Credit Start Date | Date |
| Discount Type | Character |
| Discount Value | Number |
| Credit Grant Date | Date |
| Transaction Type | Number |
| Reduction Table Applies | Character |
See: Federal Workers Housing Fund (INFONAVIT)
When creating elements in the Element Design Wizard, Oracle HRMS creates the following input values based on the calculation rule you specify.
See: Input Values and Formula Results
The Element Design Wizard automatically creates the Fast Formula element, based on the formula templates and calculation types. The formula name has the element name as a prefix and the calculation name as the suffix.
When creating elements in the Element Design Wizard, Oracle HRMS creates the following formula result rules based on the calculation rule you specify.
See: Input Values and Formula Results
When creating elements through the Element Design Wizard, it generates the following balance feeds and dimensions based on the calculation method you select.
See: Balance Types, Dimensions, and Feeds
The payroll run uses Element Type Usages to determine whether an element can be processed in the run type being processed. The payroll run can also use element type usages to determine if a particular run type should be triggered. Mexico Payroll uses Element Type Usages to implement the Tax Processing functionality.
Elements with 'Regular' tax processing type are excluded from the following run types:
Separate Payment - Non Periodic
Process Separately - Non Periodic
Elements with 'Non Periodic' tax processing type are excluded from the following run types:
Separate Payment
Process Separately
The payroll run uses element type usages and run types to determine if Oracle Payroll should use Article 142 to calculate ISR tax instead of Article 113.
When creating Earnings elements, the element template wizard creates the following Element Extra Information Types to support the Historic Rates functionality for the calculation of IDW:
Historic Rate - Element Attribution
Historic Rate - Rate Types
When creating Deductions elements, the element template wizard creates the following Element Extra InformationType to support the INFONAVIT Discounts and Retirement Fund Voluntary Contributions:
Deduction Processing
If you need to delete elements you created with the Element Design Wizard, do not use the Element window. Query the element from within the wizard and delete it from there.
See: Deleting an Element
You initiate the earnings types and non-payroll payments you need in accordance with your own compensation policies, by entering information about them in the Element Design wizard.
In response to your entries in this wizard, Oracle Payroll generates an element for the earnings or payment, with the necessary input values and balance feeds, and a formula with the necessary formula result rules.
Wages, overtime pay, and shift pay are typically calculated by multiplying an hourly rate by number of hours worked. Oracle Payroll captures this information for each rate that applies during the payroll period, so if an assignment has element entries paid at different rates during a period, you can display the earnings at each rate on the statement of earnings and online payslip.
This information is available for any earnings type you initiate with the Hours * Rate calculation rule.
You can calculate earnings by multiplying a daily rate by number of days worked. Oracle Payroll captures this information for each rate that applies during the payroll period, so if an assignment has element entries paid at different rates during a period, you can display the earnings at each rate on the statement of earnings and online payslip.
This information is available for any earnings type you initiate with the Days * Rate calculation rule.
If you need to delete elements you created with the Element Design Wizard, do not use the Element window. Query the element from within the wizard and delete it from there.
See: Deleting an Element
You initiate the non-tax (pretax, benefit, voluntary) deductions you need by entering information about them in the Element Design Wizard.
In response to your entries in this wizard, Oracle Payroll generates two elements for the deduction, with the necessary input values and balance feeds, and a formula with the necessary formula result rules:
| Element | Description |
|---|---|
| <Element Name> | This base element is the main deduction element. You need to create an element entry for each employee that is eligible for the deduction. |
| <Element Name> Special Features | This element is an indirect only element. It is used behind-the-scenes in the payroll run to maintain some balances associated with the deduction. |
When you initiate the deduction, you determine the rules that control its processing, including the following:
Start and stop rules
You select the rules that determine when the deduction starts or stops for an employee. For example, a deduction might start when a balance of earnings for the employee reaches a specified amount. It might end when a balance of the amount taken for the deduction reaches a specified amount.
Amount rules
You select the method of entering or calculating the amount of the deduction. For example: The amount can be entered for each employee, it can be calculated by a formula as a percentage of earnings, or it can be selected by the formula from a Payroll table.
Frequency rules
These rules determine the pay periods in which the deduction is withheld. For example, a monthly deduction might be processed in the third period of the month for weekly-paid employees and in the second period of the month for employees paid on a semi-monthly basis.
Insufficient Funds rules
You can determine whether to hold an arrears balance for a deduction, and whether to take a partial deduction if earnings are insufficient to take the full deduction amount.
There are additional rules you can define for wage attachments.
See: Input Values for Wage Attachments, Oracle HRMS Compensation and Benefits Management Guide
To ensure that your tax calculations are accurate, you must associate the following predefined deduction elements to all employee assignments:
Employer State Tax
Integrated Daily Wage
Mexico Tax
Social Security Quota
Do this by editing each element in the Element window and selecting the Standard Link option.
In response to the information you enter for an earnings type or non-payroll payment in the Element Design Wizard, the system generates the essential components of the earnings or payment. These include:
An element whose structure includes the necessary input values and balance feeds.
A formula prescribing the correct processing for the earnings or payment, together with the formula processing and result rules.
The following sections discuss the particular input values and rules that you can generate, and the circumstances under which they are used. These input values and rules control the following:
Overrides to the tax jurisdiction of an earnings type.
Payment of an earnings type or non-payroll payment by a separate payment, issued in addition to the usual pay cheque or direct deposit payment.
The calculation rule used to determine the amount of an earnings or non-payroll payment.
Initiating Earnings and Non-Payroll Payments, Oracle HRMS Compensation and Benefits Management Guide
Oracle Payroll provides two types of payroll runs for Mexico, Regular and Tax Adjustment. A normal payroll cycle uses the Regular run type. Use the Tax Adjustment run once or twice a year to reconcile the employee's tax records. The Element Design Wizard defines the method for defining the tax processing type, using a periodic or non-periodic element.
See: Defining Earnings and Deductions Elements
You sometimes pay certain earnings or non-payroll payments by issuing separate payments to employees in addition to their regular pay cheques or direct deposit payments.
You might pay a special bonus or award, or a reimbursement for moving expenses, using a separate payment.
For control of separate payments, the elements generated for all earnings in the Earnings and Supplemental Earnings classifications, and for all payments in the classification Non-payroll Payments, include the Separate Payment input value.
For Canadian users: Set this value through the Earnings window.
For Mexican users: Set this value through the Element Design Wizard.
This input value has a default entry of No.
You can change this input value entry back and forth between No and Yes for an earnings type or payment, using the Element Link window. For an individual employee, you can make an entry of No or Yes for this input value using the Element Entries window, to stop or enable a payment by separate payment.
| Input Value Name | Purpose of Entry |
|---|---|
| Separate Payment | Yes indicates that this earning should be paid by separate payment. Default is No. |
| Process Separately | Yes indicates that you would like Oracle Payroll to process this earning separately from the others (such as for taxation purposes). The default is No. |
Through the Element Design Wizard, you select a rule that determines how Oracle Payroll calculates the amount of the earnings or payment. The system then generates the appropriate element input values. The available calculation rules are:
Flat Amount
Hours * Rate
Days * Rate
Percentage of Regular Earnings
Elements generated for earnings or non-payroll payments with this rule includes an Amount input value for entry of an amount. No calculations are necessary to determine the amount of this earnings or payment.
| Input Value Name | Purpose of Entry |
|---|---|
| Amount | Gives a formula for the earnings or payment amount. |
The elements generated for earnings with this rule include the Hours Worked, Rate, and Multiple input values. Hours Worked holds the number of hours worked at a particular Rate. Multiple represents a multiple for the calculation. For example, for a pay uplift of 5% above the standard, make an entry of .05 in this input value.
| Input Value Name | Purpose of Entry |
|---|---|
| Hours Worked | Gives a formula for the hours worked at each rate. |
| Rate | Gives a formula for the rates to use. Entries here override Rate Code entries. If you leave this field empty, Oracle Payroll derives the rate based on:
|
| Multiple | Gives a formula for the multiplier to use for the calculation. |
Use this calculation rule for elements that require the number of days worked multiplied by the daily pay rate. It includes the Days Worked and Rate input values. Days Worked holds the number of hours worked at a particular Rate.
| Input Value Name | Purpose of Entry |
|---|---|
| Days Worked | Gives a formula for the days worked at each rate. |
| Rate | Gives a formula for the rates to use. Entries here override Rate Code entries. If you leave this field empty, Oracle Payroll derives the rate based on:
|
For a worker who paid bi-weekly and worked 10 days at $50.00 per day, you would enter a value of 10 in the Days field and 50.00 in the Rate field in the employee's assignment record.
Note: The formula for this rule can calculate the earnings to be paid if no input value is entered for either Days or Rate. This requires a definition of a Salary Element that does NOT process in payroll (Process in Run option set to "NO"). To determine the number of days to pay, the system will try to locate the employee's work schedule. If there is no work schedule on record, it uses a default work schedule as the number of days to pay.
To set this up:
Define a salary element named MX_Monthly with the "Process in Run" option deselected.
Associate it to a salary basis called MX_Month.
Attach this salary basis to the employees' records along with the Days * Rate element.
The system will now annualize the monthly salary, annualize the pay frequency (Weekly/Bi-weekly:364 days - Monthly/Semi-Monthly:360 days) and determine the daily rate of pay.
An employee is paid $5,428.80 monthly salary. You enter MX_MONTHLY 5428.80 in the Salary Administration form off the Assignment window. You select Days * Rate in the Elements Entries window but do not specify any data in the fields.
Oracle Payroll computes the number of days to be paid (30) and determines the daily pay rate ($180.96).
Oracle Payroll generates elements for earnings with this rule with the input value Percentage, for entry of the percentage to use in the calculation.
| Input Value Name | Purpose of Entry |
|---|---|
| Percentage | Gives a formula for the percentage to use. |
For a salaried employee, the formula for this rule locates the employee's regular monthly earnings as an entry in the Monthly Salary input value (Periodic Salary in Canada) of the earnings Regular Salary.
For a waged employee, it calculates the regular earnings in a pay period by finding the employee's wage rate and multiplying it by the hours normally worked in a pay period. It locates the employee's usual hours worked by referencing the work schedule or, if there is none, the standard working hours for their assignment. It finds the wage rate by referencing, in this order:
The employee's salary basis.
The rate code entered for the employee for the earnings Regular Wages.
The rate entered for the employee for Regular Wages.
See: HR Organizations: Entering a Work Schedule, Oracle HRMS Enterprise and Workforce Management Guide and Business Groups and HR Organizations: Work Day Defaults, Oracle HRMS Enterprise and Workforce Management Guide
Oracle Payroll enables you to control starting and stopping deductions in several ways:
Start Rule or Stop Rule: On Entry
When the start rule is On Entry, the deduction begins on the effective date you enter the deduction for an employee.
When the stop rule is On Entry, the deduction ends on the effective date the entry is deleted.
Start Rule: Earnings Threshold
The deduction starts when the Gross Earnings balance for the employee reaches a specified amount.
The formula for deductions with this rule checks whether the payroll run has caused the employee's year-to-date value of the Gross Earnings balance to reach or surpass the threshold amount.
The deduction stops for an employee when a balance of the amount taken for the deduction reaches a specified amount.
US and Canadian users: You specify the start and stop rules through the Deductions window.
Mexican users: You specify the start and stop rules through the Element Design Wizard.
Note: You can modify the generated formula to reference a different balance.
The elements Oracle Payroll generates for initiated deductions include entry values needed for particular start and stop rules. Specify a default value for all eligible employees in the Default field of the Entry Values sub window of the Element Link window. Specify a value for an individual employee in the Entry Values sub window of the Element Entries window. The entry values are:
| Start or Stop Rule | Entry Value Name | Purpose of Entry |
|---|---|---|
| On Entry start and stop rule | On Entry | N/A |
| Earnings Threshold start rule | Threshold Amount | Gives formula the balance value that triggers deduction's start (Formula references Gross Earnings balance).
Note: This rule does not apply to Mexico. |
| Total Reached stop rule | Total Owed | Gives formula the total amount that triggers deduction's stop. |
When you use a Total Reached stop rule, the accrued balance is automatically set to zero when the amount deducted reaches the total owed. However, if you end the element entry before this happens, the balance is not cleared. If you enter the same element for the employee in the future, this deduction will end before the total owed has been deducted because the formula uses a balance that does not start from zero.
To prevent this problem, perform the following steps if you have to end an element entry with this stop rule before the total owed has been deducted:
Create a formula to check the value of <element_name>_ACCRUED_ASG_ITD, multiply its value by -1, and feed the result back to the accrued balance.
Create a nonrecurring element, and associate the formula with this element in the Formula Result Rules window.
Enter this element for the employee
During Deduction element definition, you can select a rule that determines how Oracle Payroll calculates the amount of the deduction. The system then generates the appropriate element input values. The available calculation rules are:
Flat Amount, if you enter an amount for each employee using BEE or the Element Entry window.
% Earnings, if you enter a percentage for each employee using BEE or the Element Entry window. The deduction formula calculates the amount from this percentage.
Note: All generated deductions include the Additional Amount and Replacement Amount input values for efficient management of one-time changes to the deduction amount. Use the pay value override to use these input values.
See: Changes to Earnings or Deductions Before a Run, Oracle HRMS Payroll Processing Management Guide.
Canadian users: Specify calculation rules through the Deductions window.
Mexican users: Specify calculation rules through the Element Design Wizard.
Elements generated for deductions with this rule include an input value Amount, for entry of the deduction amount. No calculations are necessary to determine the amount.
| Input Value Name | Purpose of Entry |
|---|---|
| Amount | Gives formula the deduction amount. |
Elements generated for deductions with this rule include a Percentage input value. The formula multiplies an employee's Regular Pay balance by the percentage figure entered in the input value.
You can modify the formula to reference a different earnings balance.
| Input Value Name | Purpose of Entry |
|---|---|
| Percentage | Gives formula the percentage to use. (Formula references the run balance of Regular Pay. |
Oracle Payroll can hold an arrears balance for a deduction. It creates the input value Clear Arrears, which you use to specify whether the payroll run should attempt to clear the arrears. It also creates two special input values for the deduction. These input values are special in that they function without you ever seeing them or making entries to them. They receive their entries automatically during the payroll run.
US and Canadian users: Enable arrears balances through the Deductions window.
Mexican users: Enable arrears balances through the Element Design Wizard.
The special input value Not Taken holds any amount not taken for the deduction in the most recent payroll run. The special input value Arrears Contr (Arrears Contribution) feeds the arrears balance.
To review an employee's arrears balance for a deduction, use the View Earnings and Deductions Balances window.
| Input Value Name | Purpose of Entry |
|---|---|
| Clear Arrears | Select Y if you want the payroll run to attempt to clear the amount held in arrears. Select N if you do not want the payroll run to attempt to clear the arrears. |
| Not Taken | Receives any amount not taken in the most recent payroll run. |
| Arrears Contr (Arrears Contribution) | Receives results of the calculation of Scheduled Amount minus Pay Value for most recent run. Feeds this result to the arrears balance. |
Note: The system also makes use of the Adjust Arrears special input value in managing arrearage.
For more information about this input value, see: Changes to Earnings or Deductions Before a Run, Oracle HRMS Payroll Processing Management Guide.
The table below presents an example of how the entries automatically made to the these input values work to maintain the arrears balance.
Scheduled deduction amount per run: $50
Pay Value = Amount actually deducted in each run
Clear Arrears = Y
| Run | Pay Value | Not Taken | Arrears Contr (Arrears Contribution) | Arrears Balance |
|---|---|---|---|---|
| 1 | 50 | 0 | 0 | 0 |
| 2 | 30 | 20 | 20 | 20 |
| 3 | 10 | 40 | 40 | 60 |
| 4 | 110 | 0 | -60 | 0 |
| 5 | 50 | 0 | 0 | 0 |
Oracle Payroll automatically creates a number of balances for the deductions you create. The rules you select for the deductions determine which balances Oracle Payroll creates. You can review the definition of these balances in the Balance window.
You can see the value of these deductions for an employee using the View Earnings and Deductions Balances window.
See: Reviewing Earnings and Deductions Balances, Oracle HRMS Compensation and Benefits Management Guide
Note: To view tax balances for individuals, use the View Tax Balances window.
See: Viewing Tax Balances, Oracle HRMS Payroll Processing Management Guide
The balances that Oracle Payroll creates include the following:
This balance exists only for deductions with a stop rule of Total Reached. It holds the amount accumulated to date toward the total.
See: Deduction Start and Stop Rules
This balance exists only for deductions for which the system holds arrearage when employee earnings are insufficient to cover the deduction's full amount. The arrears balance holds any amounts not taken but held in arrears.
Oracle HRMS tracks federal tax subject and exempt amounts at the element level. Year-end reporting requires that users classify earnings elements into groups specified on the year-end forms and then track each element's contribution towards that group's subject and exempt amount. These groups can include:
Wages and Salaries
Annual Bonus
Travel Expenses
Overtime
Vacation Premium
HRMS maintains these subject and exempt components through the Earnings and Deductions elements.
Use the procedure below to define any elements that you require for earnings and deductions during a payroll run.
To define an earnings or deductions element
From the Total Compensation section of the main menu, select Basic and then Create Earnings/Deductions.
The Element Design Wizard launches, enabling you to select the minimal business rules needed to create an Earnings or Deductions element.
Follow the on-screen instructions.
If you need to include additional rules or other special routines, you can use the Element window and other windows to configure your business rules.
See: Customizing Generated Elements, Balances, and Formulas
To ensure that your tax calculations are accurate, you must attach the following predefined deduction elements to all employee assignments:
Employer State Tax
Integrated Daily Wage
Mexico Tax
Social Security Quota
To attach predefined elements to assignments
From the Total Compensation menu, select Basic and then Link.
Query for the element.
Select the Standard check box.
Save your work.
To specify tax exemptions to elements
Open the Assignment window and query for the assignment you want to update.
Click Element Entries to open the Element Entries window.
Query for the tax you want to exempt.
You can make assignments exempt for the following taxes:
Employer State Tax
Mexico Tax
Social Security Quota
Specify the tax as exempt.
Save your work.
Oracle HRMS uses two balances to calculate PTU amounts. These balances provide you the flexibility to select which earnings and days should contribute towards the basis for calculating the profit sharing amounts for each employee.
Eligible Compensation for Profit Sharing: Use this balance to track the earnings that should be included in the basis for profit sharing calculation. Oracle HRMS uses this balance to calculate each employee's average daily salary. It automatically feed this balance from all earnings elements that have the Eligible Compensation for Profit Sharing secondary classification associated with them.
Eligible Work Days for Profit Sharing: Use this balance to track the number of days worked by each employee in the year. Oracle HRMS uses this balance to calculate each employee's profit sharing portion based on number of days worked. It also uses this balance to calculate each employee's average daily salary for the profit sharing process.
You need to make sure the balance feeds are set up appropriately for these balances before you run the Profit Sharing Report. You can associate these secondary classifications with any existing earnings elements from the Balance Feeds window.
See: Creating Balance Feeds for Individual Elements
Note: Although you can modify the balance feeds for these Profit Sharing balances as often as desired before running the Profit Sharing Report, altering balance feeds affects derivation of balances and can cause reports and processes to run slower.
When defining a new earnings element, you associate these secondary classifications through the Element Design Wizard.
To assign PTU eligibility to an earning
Use the Element Design Wizard to create the new Earnings element.
Select Yes for the Eligible Compensation for Profit Sharing option.
Select Yes for the Eligible Worked Days for Profit Sharing option.
Note: Use the Balance Feed Control window to associate existing earnings elements with these balances.
See: Creating Classes of Balance Feeds
Article 142 is the tax code responsible for the taxation of non-recurring earnings that are remitted as separate payments. These payments are:
Christmas Bonus
Vacation Premium
Dominical Premium
Profit Sharing
To apply Article 142 to an earning
Use the Element Design Wizard to create the new Earnings element.
Specify this element as non-periodic.
Indicate payment is remitted separately.
Elements are processed during payroll runs according to the business rules for each element that you define at setup. Many of these rules are defined in formulas, written using Oracle FastFormula. Formulas specify how the payroll run should perform calculations for the element.
This is a basic formula for the calculation for the element Wages:
Wages = Hours Worked in Week * Wage Rate
The processed results for each element are called the run results. They become balance feeds for different balances. Some balance feeds are predefined to feed required statutory balances, and you can create your own balance feeds to your own user defined balances.
Formulas obtain some of the data they need from entries to their element's input values. The Wages formula above, for example, could locate each employee's hours worked as an entry to the input value Hours of the Wages element.
Formulas can also obtain information from database items. Much of the information in the Oracle HRMS database, including extensive information on employees and their assignments, is available to formulas as database items. For example, the Wages formula can locate each employee's wage rate as a database item.
There are several ways to vary the processing performed by formulas:
You can use conditional logic (IF..THEN) within a formula to perform different calculations depending on any information taken from input values or database items (such as length of service).
You can associate more than one formula with an element, each triggered by a different assignment status (such as Active Assignment or On Sabbatical).
You can use one formula but associate different formula results with each assignment status.
You can associate a skip rule formula with an element. This formula can check balances, other element entries, the assignment status or any other database items to determine whether the payroll run should process the element for an assignment.
Mexico only: Mexican implementations do not support skip rules by default. They must be enabled manually.
Formulas can produce different types of run results:
The direct result is the amount of an earnings or deduction, for example, the dollar amount of wages an employee has earned that week. As well as calculating the amount to be paid, direct results can be used for costing purposes and analysis (such as tracking hours of overtime).
Indirect results, updates, and stops. A formula result can make an entry to the input value of another element for its formula to use. An indirect result is an entry to a nonrecurring element. An update is an entry to a recurring element. A stop puts an end date on a recurring entry of another element, to prevent it being processed in the run.
Order indirect. This result updates the subpriority of an element that has not yet been processed.
Messages. For example, you can write a formula that checks the length of a text string, and have it issue a message for payroll users if the string is too short or too long.
You set up formula result rules to determine the type of each result, and the names and input values of any other elements the result may affect.
Oracle Payroll comes with formulas specific to your legislation. Generally, you receive all the calculations required for employee tax withholding and employer taxes. When there are changes to taxes, you receive updates. You may also receive formulas for other earnings and deductions, depending on your legislation.
When creating Earnings elements in the Element Design Wizard, Oracle HRMS creates the following input values and formula result rules based on the calculation rule you specify:
| Input Value | Formula Result | Rule Type |
|---|---|---|
| Pay Value | flat_amount | Direct |
| mesg | Message (Warning) |
| Input Value | Formula Result | Rule Type |
|---|---|---|
| Pay Value | earnings_amount | Direct |
| Days | earnings_days | Direct |
| mesg | Message (Warning) |
| Input Value | Formula Result | Rule Type |
|---|---|---|
| Pay Value | earnings_amount | Direct |
| Hours | earnings_hours | Direct |
| mesg | Message (Warning) |
| Input Value | Formula Result | Rule Type |
|---|---|---|
| Pay Value | earnings_amount | Direct |
| mesg | Message (Warning) |
| Name | UOM | Reqd. | User Enterable | Database Item | Lookup | From | To |
|---|---|---|---|---|---|---|---|
| ISR Subject | Money | No | No | No | NULL | 01-Jan-1900 | 31-Dec-4712 |
| ISR Exempt | Money | No | No | No | NULL | 01-Jan-1900 | 31-Dec-4712 |
When creating Deductions elements in the Element Design Wizard, Oracle HRMS creates the following input values and formula result rules based on the calculation rule you specify:
| Element | Input Value | Formula Result | Rule Type | Comments |
|---|---|---|---|---|
| <Element Name> | Pay Value | dedn_amount STOP_ENTRY Mesg |
Direct Stop Rule Message (Warning) |
Final result of the formula calculation. |
| <Element Name> | Amount | Amount to process in payroll run. | ||
| <Element Name> | Total Owed | Created only when "Stop When Total Reached" is set to "Yes" on the wizard. Specifies the total amount owed by the employee. The deduction processes every payroll period until the total amount withheld is equal to the amount specified for this input value. | ||
| <Element Name> | Clear Arrears | set_clear | Update Recurring | Created only when "Insufficient Funds processing" is set to "Maintain arrears." Specify a value at which to clear the arrears balance for the deduction. |
| <Element Name> Special Features | Accrued | to_total_owed | Indirect | Created only when "Stop When Total Reached" is set to "Yes" on the wizard. Used to feed the Accrued balance for the deduction. |
| <Element Name> Special Features | Not Taken | to_not_taken | Indirect | Used to feed the Not Taken balance. |
| <Element Name> Special Features | Arrear Contr | to_arrears | Indirect | Created only when "Insufficient Funds processing" is set to "Maintain arrears." Used to maintain the Arrears balance for the deduction. |
| Element | Input Value | Formula Result | Rule Type | Comments |
|---|---|---|---|---|
| <Element Name> | Pay Value | dedn_amount STOP_ENTRY Mesg |
Direct Stop Rule Message (Warning) |
Final result of the formula calculation. |
| <Element Name> | Amount | Percentage to be applied to eligible earnings. | ||
| <Element Name> | Total Owed | Created only when "Stop When Total Reached" is set to "Yes" on the wizard. Specifies the total amount owed by the employee. The deduction processes every payroll period until the total amount withheld is equal to the amount specified for this input value. | ||
| <Element Name> | Clear Arrears | set_clear | Update Recurring | Created only when "Insufficient Funds processing" is set to "Maintain arrears." Specify a value at which to clear the arrears balance for the deduction. |
| <Element Name> Special Features | Accrued | to_total_owned | Indirect | Created only when "Stop When Total Reached" is set to "Yes" on the wizard. Used to feed the Accrued balance for the deduction. |
| <Element Name> Special Features | Not Taken | to_not_taken | Indirect | Used to feed the Not Taken balance. |
| <Element Name> Special Features | Arrear Contr | to_arrears | Indirect | Created only when "Insufficient Funds processing" is set to "Maintain arrears." Used to maintain the Arrears balance for the deduction. |
The Element Design Wizard automatically creates the Fast Formula element, based on the formula templates and calculation types. The formula name has the element name as a prefix and the calculation name as the suffix.
| Calculation Rule | Formula Suffix | Example |
|---|---|---|
| Flat Amount | FLAT_AMOUNT_EARN | Element Name: Monthly Salary Formula Name: MONTHLY_SALARY_FLAT_AMOUNT_EARN |
| Days * Rate | DAYS_X_RATE | Element Name: Christmas Bonus Formula Name: CHRISTMAS_BONUS_DAYS_X_RATE |
| Hours * Rate | HOURS_X_RATE | Element Name: Overtime Double Formula Name: OVERTIME_DOUBLE_HOURS_X_RATE |
| Percentage of Earnings | PCT_EARN | Element Name: Performance Bonus Formula Name: PERFORMANCE_BONUS_PCT_EARN |
| Calculation Rule | Formula Suffix | Example |
|---|---|---|
| Flat Amount Deduction | FLAT_AMOUNT_DEDN | Element Name: Saving Fund Formula Name: SAVING_FUND_FLAT_AMOUNT_DEDN |
| Percentage Deduction | PCT_DEDN | Element Name: Loan Formula Name: LOAN_PCT_DEDN |
When creating elements through the Element Design Wizard, it generates the following balance feeds and dimensions based on the calculation method you select:
| Balance Name | Input Values that Feed the Balance | Dimensions |
|---|---|---|
| (element name specified on the wizard) | Pay Value |
|
| Balance Name | Input Values that Feed the Balance | Dimensions |
|---|---|---|
| (element name specified on the wizard) | Pay Value |
|
| <element name> Days | Days |
|
| Balance Name | Input Values that Feed the Balance | Dimensions |
|---|---|---|
| (element name specified on the wizard) | Pay Value |
|
| <element name> Days | Hours |
|
| Balance Name | Input Values that Feed the Balance | Dimensions |
|---|---|---|
| (element name specified on the wizard) | Pay Value |
|
| Name | Balance | UOM | Scale | From | To |
|---|---|---|---|---|---|
| ISR Subject | <BASE NAME> ISR Subject |
Money | Add | 01-Jan-1900 | 31-Dec-4712 |
| ISR Exempt | <BASE NAME> ISR Exempt |
Money | Add | 01-Jan-1900 | 31-Dec-4712 |
| ISR Subject | ISR Subject | Money | Add | 01-Jan-1900 | 31-Dec-4712 |
| ISR Exempt | ISR Exempt | Money | Add | 01-Jan-1900 | 31-Dec-4712 |
When creating elements through the Element Design Wizard, it generates the following balance feeds and dimensions for both Flat Amount and Percentage Deduction calculation rules:
| Element | Balance Name | Input Values that Feed the Balance | Dimensions |
|---|---|---|---|
| <Element Name> | Pay Value |
|
|
| Special Features | <Element Name> Accrued | Accrued |
|
| Special Features | <Element Name> Arrears | Arrears Contr (Arrears Contribution) |
|
| Special Features | <Element Name> Not Taken | Not Taken |
|
When you have occasion to look at the structure of an element online, you may see an input value named Pay Value at the top of its input value listing.
The Pay Value is different from other input values. Its purpose is to store an element's run result. For example, suppose the formula for the Wages element is:
Wages = Hours Worked * Wage Rate
If an employee whose wage rate is $10/hour works 40 hours in a week, the payroll run produces a run result of $400 for this assignment's Wages element. It stores this result in the element's Pay Value.
If you give an entry to a Pay Value before a run, this entry becomes the element's run result. For example, suppose you enter 40 in the Time Worked input value of the Wages element for an employee who earns $10/hour, but also enter $100 in the element's Pay Value. The run ignores the entry of hours worked and the Wages formula, and simply produces a run result of $100 for this employee.
You must define a Pay Value as one of the inputs for the element if you want Oracle Payroll to process an element for pay. You can have only one Pay Value for each element and it must have the name 'Pay Value'.
Oracle HRMS enables you to calculate proportionate earnings amounts whenever payroll-relevant data is changed during a payroll period, for example, if an employee joins or leaves the company during a payroll period or if an employee's pay grade changes during a payroll period. Oracle HRMS performs a proration calculation to ensure that the employees' earnings are calculated correctly after taking account of these changes.
If you want to prorate an earnings element, such as basic salary, assign an event group to it. An event group is a collection of proration points that share similar characteristics. You can create an event group to group together all proration points that affect an employee's salary, for example. This event group could contain proration points such as salary increases, assignment changes, and pay rate changes.
You then process the element using a formula that handles proration. You can either use a payroll formula that handles proration, or create a separate proration formula that runs after the main payroll formula only in payroll periods when a proration event occurs.
See: Sample Payroll Formulas Enabled for Proration (UK), Oracle HRMS FastFormula User Guide, Sample Proration Formula, Oracle HRMS FastFormula User Guide, and Writing Proration Formulas, Oracle HRMS FastFormula User Guide
When you define the event group, you select the events that will activate proration calculation, such as:
An employee joining or leaving the enterprise
Changes to pay grades or grade rates
Changes to pay scales and progression points
Changes to hourly or annual pay rates
Changes to working hours
Changes to allowances or deductions
Note: The proration unit can be periods, days, or hours. Proration can be applied to a monetary, time-based, or numeric amount.
The following table lists the predefined elements that are specific to Oracle HRMS for Mexico.
| Element Name | Description |
|---|---|
| Mexico Tax | Element to initiate the MEXICO_TAX tax calculation fast formula. Performs the following:
You must standard link this element to all employee assignments. |
| ISR | Computes ISR Tax. |
| ISR Amends | Maintains the amends balances. |
| ISR Credit to Salary | ISR credit to salary calculated during payroll run. |
| Social Security Quota | Element to kick-off social security quota calculation formula. You must standard link this element to all employee assignments. |
| Social Security Quota Calculation EE | Calculated social security quota values for employees. Feeds all employee balances. |
| Social Security Quota Calculation ER | Calculated social security quota values for employer. Feeds all employer balances. |
| Social Security Quota Subject | Calculated values for earnings subject to social security quota. Feeds all subject balances (employee and employer). |
| Social Security Quota Taxable | Calculated values for earnings taxable for social security quota. Feeds all taxable balances (employee and employer). |
| Integrated Daily Wage | Element used for calculating IDW in the payroll run. You must standard link this element to all employee assignments. |
| Employer State Tax | Element to initiate the Mexican state tax calculation formula. Performs the following:
|
| Employer State Tax Liability | Mexican state tax. |
| Value Name | Balance Name | Units | Add or Subtract |
|---|---|---|---|
| Pay Value | Net Pay | Money | Subtract |
| Pay Value | Total Pay | Money | Subtract |
| Pay Value | Tax Deductions | Money | Add |
| Pay Value | ISR Withheld | Money | Add |
| ISR Creditable Subsidy | ISR Creditable Subsidy | Money | Add |
| ISR Non Creditable Subsidy | ISR Non Creditable Subsidy | Money | Add |
| ISR Calculated | ISR Calculated | Money | Add |
| ISR Subject Non Periodic | ISR Subject Non Periodic | Money | Add |
| ISR WIthheld Non Periodic | ISR Withheld Non Periodic | Money | Add |
| ISR Subject for Profit Sharing | ISR Subject for Profit Sharing | Money | Add |
| ISR Withheld for Profit Sharing | ISR Withheld for Profict Sharing | Money | Add |
| Value Name | Balance Name | Units | Add or Subtract |
|---|---|---|---|
| Pay Value | Net Pay | Money | Add |
| Pay Value | ISR Credit to Salary Paid | Money | Add |
| Pay Value | Tax Credit | Money | Add |
| Pay Value | Total Pay | Money | Add |
| ISR Credit to Salary | ISR Credit to Salary | Money | Add |
| Value Name | Balance Name | Units | Add or Subtract |
|---|---|---|---|
| ISR Subject for Amends | ISR Subject for Amends | Money | Add |
| ISR Withheld for Amends | ISR Withheld for Amends | Money | Add |
| Last Monthly Ordinary Salary | Last Monthly Ordinary Salary | Money | Add |
| Last Monthly Ordinary Salary Withheld | Last Monthly Ordinary Salary Withheld | Money | Add |
Follow this process to set up earnings, deductions, and other items in the compensation package you offer to employees. There are additional steps for setting up the following types of compensation and benefits:
Salaries for Salary Administration
Items subject to collective agreements
See: Setting Up a Collective Agreement, Oracle HRMS Enterprise and Workforce Management Guide
Define Validation
Define validation for entries of any new elements you are creating for information. You can also define validation rules to add to elements generated for payroll processing.
To restrict compensation entries to a list of valid values, define a new Lookup Type and add Lookup Values for this new lookup.
See: Adding Lookup Types and Values, Oracle HRMS Configuring, Reporting, and System Administration Guide
To validate compensation entries using formulas, write a formula of type Element Input Validation.
See: Writing Formulas for Validation, Oracle HRMS FastFormula User Guide
Define Elements for Information and Benefits
Define elements to hold information on tangible items distributed to employees. If you are not using Oracle Payroll, define elements to hold information on employee compensation and benefits.
See: Defining an Element for Information, Oracle HRMS Compensation and Benefits Management Guide
See: Defining an Element's Input Values
Note: Every element you create automatically includes the Jurisdiction input value.
See also: Deleting an Element
Define frequency rules, if necessary, to determine the periods in which the element should be processed.
If you are using Standard or Advanced Benefits, also define elements for each activity rate calculation.
Define Earnings and Deductions for Payroll Processing
If you are using Oracle Payroll to process earnings and deductions:
Define or customize user tables, if deduction amounts will come from a payroll table you set up in the database.
See: Setting Up Row Types for Payroll Tables, Oracle HRMS Compensation and Benefits Management Guide
Review the generated items and customize them if necessary. For example, you can customize the processing rules, add validation rules, and add new user balances.
Define Links for Predefined, Generated, and User-defined Elements
If the payroll costs of an element should be distributed over other elements, define the distribution set.
Define element links to define one or more groups of employees who are eligible to receive an element.
See: Defining Element Links, Oracle HRMS Compensation and Benefits Management Guide
See also: Running the Element Link Details Report
Make Entries
For elements without Standard links, make entries of your elements for all employees who should receive them.
See: Making Manual Element Entries, Oracle HRMS Compensation and Benefits Management Guide
You can review at any time the earnings types, non-payroll payments, and deductions you initiate in Oracle Payroll, as well as the earnings and deductions included with the system.
Note: US and Canada: When reviewing earnings or deductions, you may find two with the same name, the second however including the words "Special Inputs" (such as, Regular Salary and Regular Salary Special Inputs). The special inputs element exists to provide a convenient way to enter a change to an earnings or deduction before a payroll run. There is no special inputs element for net-to-gross earnings types.
Mexican implementations do not support special inputs.
To review the structures of earnings and deductions, use these windows:
Element
Formula
Formula Result Rules
US and Canada only: Earnings template
US and Canada only: Deductions template
Mexico only: Element Design wizard
To review processing and amount rules
For an earnings or payment, use the Earnings window/Element Design wizard, and query the earnings or payment.
For US and Canada, see: Initiating Earnings and Non-Payroll Payments, Oracle HRMS Compensation and Benefits Management Guide
For Mexico, see: Defining Earnings and Deductions Elements
For a deduction, use the Deduction window/Element Design wizard, and query the deduction.
For US and Canada, see: Setting up Deductions, Oracle HRMS Compensation and Benefits Management Guide
For Mexico, see: Defining Earnings and Deductions Elements
To review input values and balance feeds
Using the Element window, query the earnings, payment, or deduction.
Click Input Values to review the input values.
Every element has the default Jurisdiction input value.
Click Balance Feeds to review the balance feeds.
To review formulas and formula result rules
Query the earnings, payment, or deduction in the appropriate window:
Formula window
See: Writing or Editing a Formula, Oracle HRMS FastFormula User Guide
Formula Result Rules window
When you initiate the earnings, non-payroll payments, and non-tax deductions your enterprise requires, Oracle Payroll generates:
Elements
Balances and balance feeds
Formulas for payroll calculations and element skip rules
Formula processing and result rules
You can modify these generated components to enhance their suitability or efficiency for use at your installation. Some modifications can be made even after processing has occurred, but most should be made before processing the element in a payroll run.
Important: If a generated element requires changes because of mistaken entries made when initiating the earnings or deduction, it is best to delete the results and re-initiate.
For example, if you select the wrong processing rule or amount rule when initiating an earnings or deduction, simply delete the generated components and begin again.
| Use This Window . . . | For . . . |
|---|---|
| Element | Processing rules include: termination rules, closed for entry, process in run, third party payment, processing priority, and skip rule. |
| Frequency Rules | Defining Frequency Rules for recurring deductions |
| Use This Window . . . | For . . . |
|---|---|
| Further Element Information |
US only
Mexico only
|
| Use This Window . . . | For . . . |
|---|---|
| Input Values |
| Use This Window . . . | For . . . |
|---|---|
| Balances | Defining User Balances |
| Balance Feeds | Creating Balance Feeds |
| Use This Window . . . | For . . . |
|---|---|
| Formulas | Writing or Editing a Formula, Oracle HRMS FastFormula Guide, |
| Formula Result Rules | Modifying Formula Processing and Result Rules |
Oracle Payroll generates elements when you initiate earnings and deductions. Using the Element window, you can modify some of the processing information for these elements.
Do not change the following options:
Processing type (recurring or nonrecurring)
Indirect results only
The Additional Entry Allowed rule has no applicability for North American installations. It is available for use at sites outside North America, and benefit classifications do not apply in Canada.
To modify processing information
In the Element window, query the generated element you are modifying.
To control the processing of entries to the element after employee termination, you can select an alternative termination rule.
If the termination rule is Actual Termination, and the element's processing type is recurring, entries to the element close down on the employee's termination date. If the element's processing type is nonrecurring, entries close down either on the last date of the pay period in which the employee leaves or on the date the assignment ends (the final process date) if this is earlier.
If the termination rule is Final Close, entries to the element stay open beyond the actual termination date. This makes it possible to pay bonuses, severance pay, and so on, and to make year end adjustments after the employee's actual termination date.
Note: Recurring elements with the Final Close rule only process in runs after the Last Standard Process Date if there is also a nonrecurring entry to process in that run.
If the termination rule is Last Standard Process, entries to the element are not processed after the Last Standard Process date. The Last Standard Process date defaults to the last day of the pay period in which the employee is terminated, but you can set it to a later period when you terminate an employee. This is the appropriate rule for many recurring earnings types.
You can prevent the element from accepting any new entries, either temporarily or permanently, as of a certain date. Set the effective date to the date from which you want to close down the element, and check Closed for Entry. This does not affect any existing entries.
Note: Use the Closed for Entry feature with caution. When you perform certain important tasks in Oracle HRMS, the system may automatically create or delete element entries. These tasks include hiring and terminating people, and updating assignments. Therefore, if you check Closed for Entry for an element, this might prevent users terminating employees and updating assignments. If there are standard links for the element, it will also prevent users hiring people who are eligible for the element.
You can control an element's availability for processing in runs by selecting or deselecting the Process in Run box.
To make third party payments from an earnings or deduction element, check the Third Party Payment box.
If you want to determine the order in which the element processes within its classification range, you can change the default priority number appearing in the Priority field. The payroll run processes elements with lower priority numbers first.
You can select a skip rule for the element in the Skip Rule field.
To select foreign currencies for element entries or run results
Define the balances required to hold amounts of the local currencies if you set up earnings types to produce payments in local currencies (instead of the ledger currency of the Business Group). The system does not generate these balances.
To make entries for the element in a currency other than the Business Group's ledger currency, select the currency in the Currency Input field.
For example, if the element represents a housing allowance of 500 pounds sterling paid monthly to a North American employee working in the UK, you select GBP as the input currency.
To produce run results in a currency other than the Business Group's ledger currency, select the currency in the Currency Output field.
To set qualifying conditions for receiving element entries
If there is a minimum age for employees to receive the element, enter it in the Age field.
If employees must complete a minimum length of service before receiving the element, enter a number in the Length of Service field and select a unit of measure (such as months or years) in the Units field.
To automatically enter the element and its default input values for all eligible employees, check the Standard box.
You cannot check this box for nonrecurring elements, or for those with the rule Multiple Entries Allowed.
Note: The qualifying conditions and Standard check box provide defaults for the element. You can override them for particular groupings of employees when you build links for the element.
See: Defining Element Links, Oracle HRMS Compensation and Benefits Management Guide
To set an iterative priority
Pre-tax deductions are calculated iteratively to ensure that the maximum amount is deducted while ensuring that taxes and garnishments are paid in full, and net pay is zero or a positive amount. If multiple pre-tax elements are given to an employee, the element with the lowest processing priority (that is, the highest priority number) will be reduced first when there are insufficient earnings. You can also set an iterative priority.
Important: Iterative priority numbers must be in the reverse sequence of the processing priority numbers. This means that the element that is processed first is reduced last.
Choose the Advanced tab.
Enter a value in the Iterative Priority field.
The element with the lowest iterative priority number is reduced first. If this deduction is reduced to zero and net pay is still insufficient to cover taxes and garnishments, the element with the next lowest priority number is reduced, and so on.
Note: Do not choose the Exclude Balances button for pre-tax deductions. You use the Exclude Balances window when you are defining net-to-gross earnings; it is not relevant for pre-tax deductions.
To include rest days in an Earnings element
Specify whether or not you want to include rest days in your Earnings calculations. The choices are Yes or No.
To choose an arrearage method for a Deductions element
From the Insufficient Funds Type menu, select the procedure you want to apply in the case of arrearage.
Use the Iterative Processing Rules window to specify how to use the iterative formula results for an element. For example, you can specify which formula result adjusts an input value to feed into the next processing iteration, and which result stops the iterations.
To define iterative processing rules
Enter or query the element in the Element window - making sure the Iterative Flag check box on the Advanced tab is checked - and choose the Iterative Rules button.
Select a formula result in the Return Name field, and select a rule type: Adjust, Message, or Stop.
For a message, select the severity level: Fatal error, Information, or Warning. A Fatal message creates an error for the assignment action.
For an Adjust type, select the input value to adjust.
Save your work.
If you are using the DEFAULT_GROSSUP iterative formula, then define the following rules:
Note: For South African users only: If you are using the ZA_DEFAULT_GROSSUP iterative formula, then define the following rules:
| Return Name | Rule Type | Input Value to Adjust |
|---|---|---|
| ADDITIONAL _AMOUNT | Adjust | Additional Amount |
| HIGH_GROSS | Adjust | High Gross |
| LOW_GROSS | Adjust | Low Gross |
| REMAINDER | Adjust | Remainder |
| STOPPER | Stop | -- |
| For South Africa users only: TARGET_AMOUNT |
Adjust | Amount |
Recurring elements may require frequency rules to determine in which pay periods they should process. For example, a monthly deduction might be processed in the third period of the month for weekly-paid employees and in the second period of the month for employees paid on a semi-monthly basis.
It is possible to set frequency rules to process once- or twice-yearly deductions on monthly, quarterly, or semi-annual payrolls. These rules' periods then refer to periods within a year (months, quarters or half years) instead or periods within a month. However, for infrequent deductions, you may prefer to define them as nonrecurring and use BEE to make entries when required.
Use the Frequency Rules window to define or change an element's frequency rules at any time.
US and Canada Payroll only: Use the Deduction form to define or change a deduction's frequency rules.
Mexico only: Use the Element Design Wizard to define or change a deduction's frequency rules.
To define frequency rules
Select the name of the payroll for which you want to define frequency rules.
In the Date field, you can override the default date that the payroll run uses to assess the frequency rule, if required.
For example, suppose you are defining frequency rules for a monthly deduction. If you select Effective Date for a Weekly payroll and check Processing Period 1, the payroll run only takes the deduction if the run's effective date is in the first week of the month.
Check the boxes for the processing period or periods in which you want the element to process for each payroll.
For example, if you want a monthly deduction to process in the second week of the month for a weekly payroll, check the box under 2 for that payroll.
Notice that some periods are not available for all payrolls. For example, a bi-weekly payroll can only have, at most, three periods a month, so periods 4, 5, and 6 are not relevant to this payroll.
Use the Formula Result Rules window to modify the formula processing rules assigned to an element. These rules are generated by the system when you initiate an earnings or deduction. If you substitute a modified formula for the one generated for an element, or write additional formulas for the element, you also need to modify or write new processing and result rules.
At minimum, an element needs one standard processing rule. This identifies the formula the payroll run uses to process the element for employees with an Active assignment status (and a Payroll system status of Process). It is also the default formula for other assignment statuses. However, you can define other processing rules if you need to use different formulas for assignments at other statuses. For example, you could have two rules for a Wages element: Standard Wages and Paid Training Leave.
Also use this window to define how each formula result is used by the payroll run.
To modify processing rules with elements
Set your effective date to the start date for the processing rule.
Select the element you want to modify. The element's description and classification automatically display.
Click Find to display any existing processing rules for this element.
In the Processing Rules region, modify the formula selections and assignment statuses for this element.
Note: If you select a formula with inputs that do not match the element, you will receive a warning message, but you can still save your rule. Remember to update the formula before running the payroll.
Save your entries.
To modify formula result rules for each processing rule
Click on a processing rule to select it.
In the Formula Results region, select a formula result name from the list of results specified when the formula was written.
Select the appropriate formula result type. There are five possible types:
Direct result: This is the element's run result (if you send the result to the element's pay value), or a direct result updating another of the element's input values.
Indirect result: This result passes as an element entry to another nonrecurring element not yet processed.
Message: The formula issues messages under certain conditions. For example, a formula can check a loan repayment balance and, if the balance is zero, issue the message "Loan is repaid." You read formula messages using the View Run Messages window.
Order Indirect: This result updates the subpriority of the element you select in the Element field.
Stop: This formula result uses the Date Earned of the payroll run to put an end date on a recurring entry of this or another element (which must be defined with multiple entries not allowed).
Update recurring entry: This result updates recurring entries of this or another element on the effective date of the payroll run. The receiving element must be defined with multiple entries not allowed unless you are passing a recurring element's entries to itself, that is updating another entry of the same element.
Important: If your result type is Update Recurring Entry, then any future dated changes to the entry will be overwritten by the results of the current payroll run.
For all formula result types except Direct Result or Message, select the name of the element to which you want to pass the formula result. This element must have a processing priority causing it to process after the element sending the result.
For the formula result types Direct Result, Indirect Result, and Update Recurring Entry, select the input value to update.
If you select Message as the formula result type, select a message severity level. There are three choices:
Fatal: When a message with this severity results from your formula, the run rolls back all processing for the employee assignment.
Warning: A message with this level of severity does not affect payroll processing but warns the user of a possible problem.
Information: A message with this level of severity simply gives information.
Correcting and Updating Processing Rules
When you add a formula result, it takes on the effective end date of its processing rule. Any date effective changes you make to existing processing rules can affect formula results as follows:
Update: If you update a processing rule or give it an effective end date, all the rule's currently effective and future-dated formula results automatically get identical end dates.
Correction: If you correct a processing rule, all its currently effective and future-dated formula results remain unchanged.
Future delete: If you delete all future changes scheduled for a processing rule, this also deletes any future changes scheduled for the rule's formula results.
Follow these steps if you want to set up your system for proration or retro-notification.
To complete basic setup for proration or retro-notification
In the Table Event Updates window, ensure that the events you want to use are already included in the required tables. Enter the table name. The lower half of the screen displays the fields that trigger proration or retro-notification if their values are changed.
If the table has already been defined but the required event is missing, create either an Update, Delete, or Insert event and enter the table row or column to which the event refers. You can only enter a column name if you are creating an Update event. Select the change type defined by the event.
Note: The Table Event Update window is not available in all localizations.
See: Making Table Event Updates, Oracle HRMS Payroll Processing Management Guide
If the events you require have not been defined in the Table Event Update window, set up the dynamic triggers for proration or retro-notification in the Dynamic Trigger Generation window. The triggers you need depend on the method you use to compensate your employees. For example, the tables required for compensation using Salary Administration are different from those required for compensation using pay grades. The tables you are likely to use are:
PER_ALL_ASSIGNMENTS_F
PER_ALL_PEOPLE_F
PAY_ELEMENT_ENTRIES_F
PAY_ELEMENT_ENTRY_VALUES_F
PER_SPINAL_POINT_PLACEMENTS_F
PER_GRADE_RULES_F
See: Defining Dynamic Triggers, Oracle HRMS Payroll Processing Management Guide
Note: French users: Ensure you enable the dynamic triggers for PAY_ELEMENT_ENTRIES_F and PER_ALL_ASSIGNMENTS_F.
Create an event group for your proration or retro-notification events. You must create the event groups before you can create your elements.
Select the Incident Register functional area in the Functional Area Maintenance window. Make sure that your triggers are included in this functional area. If your triggers are not included, insert them.
You must also activate the triggers according to legislation or business group. For more information, see: Grouping Dynamic Triggers into Legislative Functional Areas, Oracle HRMS Payroll Processing Management Guide
Setup for retro-notification should now be complete, meaning you can proceed to running the appropriate report. However, if you are setting up proration continue with the next steps.
See: Running the Retro-Notifications Report, Oracle HRMS Payroll Processing Management Guide
To set up the elements for proration
Create your proration element. US and Mexico users: Initiate the earnings type or deduction, then query the generated element in the Element window to add a proration group and, optionally, a proration formula.
Make sure that you select a proration group for each element
Select a proration formula if you are using a separate proration formula to handle proration events (rather than enabling your payroll formula to handle proration)
Select Actual Termination as the termination processing rule
Define the input values for the element. For example, if you were using the sample payroll formulas that are enabled for proration, you would create the following input values:
Amount for a salary management element
Date Worked for a spinal point/pay scale element
Annual Deduction for a deduction or allowance
Link the element to a specific payroll or payrolls. If you want the element to be used automatically each time the payroll is assigned, select the Standard check box. If you do not select this check box, you must enter the element for each assignment.
To create the formula
Check that the database items to be used in your formula are available. If the required database items are not available, create them.
Create the proration formula or write a payroll formula that is enabled for proration.
To create a proration formula, see: Writing Proration Formulas, Oracle HRMS FastFormula User Guide
UK users: For examples of payroll formulas enabled for proration, see: Sample Payroll Formulas Enabled for Proration, Oracle HRMS FastFormula User Guide
For more information on writing formulas, see: Writing or Editing a Formula, Oracle HRMS FastFormula User Guide and Writing Payroll Formulas for Elements, Oracle HRMS FastFormula User Guide
Link the formula to your element in the Formula Result Rules window.
See: Defining Formula Processing and Result Rules, Oracle HRMS FastFormula User Guide
Attach the element to the salary basis if the salary is relevant for proration. Select the input value you created (such as Amount) in the Input Value Name field of the Salary Basis window.
You define an event group from the Table Event Group window. You use an event group to group together all proration or retro-notification points that affect an employee's salary, such as salary increases.
To define an event group
Enter a name for your event group.
Select one of the following event group types:
Proration for a proration event group
Retro for a retro-notification event group
Select the proration or retro period.
Save your entries.
Select the events that can trigger proration or retro-notification in the Datetracked Events region. To do this, select the update type, the table containing the data, and the table column.
Save your work.
Balances show the positive or negative accumulation of particular values over periods of time. They are fed either by the direct run results (that is, Pay Values) of elements processed in the payroll run, or by input values. For example, in North American installations, the input value Hours of the element Time Entry Wages feeds the balance Regular Hours Worked.
Balances exist for various time dimensions, such as current run, period to date, month, quarter to date, and year to date.
Balances also exist at different levels, such as assignment level or person level. Balances for individual employee assignments are at the assignment level (in North America, they can be at the assignment level within a GRE). If your enterprise permits employees to hold more than one assignment at the same time, you can hold balances at the person level. For example, a person level Gross Earnings balance is the sum of an employee's assignment level Gross Earnings balances.
You can select elements to feed a balance in three ways:
Select a primary classification. The run results of all elements in the classification feed the balance. However, you must have an input value of Pay Value if you want to create a feed between an element and a balance.
Select a secondary classification. You choose which elements from a primary classification (such as Earnings) are to feed the balance by giving these elements a secondary classification. Again it is the run results of the elements that feed the balance.
Note: Secondary classifications are not used in the North American versions of Oracle Payroll at this time.
Select an individual element. You can select either the run result or an input value to feed the balance. The input value must have the same unit of measure (such as hours or number) as the balance.
You can choose any number of classifications or any number of elements to feed a balance. However you cannot use a mixture of classifications and individual elements to feed a balance. When you select an element or classification as a balance feed, you specify whether the run results (or input values) should add to or subtract from the balance.
The balances and balance feeds for the elements supplied with Oracle Payroll are present in the system when you receive it. For North American users, when you initiate earnings types, deductions and other items that process in the payroll run, the system generates the appropriate balances and balance feeds together with the necessary elements.
You can define any additional balances your enterprise requires. For example, you may require a Pensionable Earnings balance for a pension plan your enterprise offers employees.
Balance Initialization is a feature provided for the implementation of payroll in Oracle HRMS and is part of the core payroll product. Use Balance Initialization when moving payroll balances from legacy payroll applications to Oracle Payroll. This process is performed once the final payroll from the old payroll application has been completed.
For example: You would use Balance Initialization when a payroll implementation takes place in the middle of a calendar year. The year-to-date wage, tax, and other balances from the old payroll application must be migrated into the corresponding Oracle Payroll balances.
Note: If your first cheque date on Oracle Payroll is in January of a new calendar year, you do not have to execute a Balance Initialization for the previous year.
After executing the Balance Initialization, your first payroll run includes year-to-date balances from the balance initialization process combined with the element run results from Oracle Payroll.
See: Balance Initialization Steps, Oracle HRMS Implementation Guide
Oracle HRMS delivers the following elements to initialize balances:
| Input Value Name | Balance Name | Units | Add or Subject |
|---|---|---|---|
| Gross Earnings | Gross Earnings | Money | Add |
| Amends Fixed Basis Eligible Comp | Amends Fixed Basis Eligible Comp | Money | Add |
| Amends Variable Basis Eligible Comp | Amends Variable Basis Eligible Comp | Money | Add |
| IDW Variable Basis Eligible Comp | IDW Variable Basis Eligible Comp | Money | Add |
| Days Basis of Quotation 1 | Days Basis of Quotation 1 | Day | Add |
| Input Value Name | Balance Name | Units | Add or Subtract |
|---|---|---|---|
| ISR Subject | ISR Subject | Money | Add |
| ISR Withheld | ISR Withheld | Money | Add |
| ISR Exempt | ISR Exempt | Money | Add |
| ISR Creditable Subsidy | ISR Credit Subsidy | Money | Add |
| ISR Non Creditable Subsidy | ISR Non Creditable Subsidy | Money | Add |
| ISR Credit to Salary Paid | ISR Credit to Salary Paid | Money | Add |
| ISR Credit to Salary | ISR Credit to Salary | Money | Add |
| ISR Subject Non Periodic | ISR Subject Non Periodic | Money | Add |
| ISR Withheld Non Periodic | ISR Withheld Non Periodic | Money | Add |
| Input Value Name | Balance Name | Units | Add or Subtract |
|---|---|---|---|
| Fixed Quota EE | Fixed Quota EE | Money | Add |
| Fixed Quota ER | Fixed Quota ER | Money | Add |
| Fixed Quota Social Security Taxable | Fixed Quota Social Security Taxable | Money | Add |
| Fixed Quota Social Security Subject | Fixed Quota Social Security Subject | Money | Add |
| Additional Quota EE | Additional Quota EE | Money | Add |
| Additional Quota ER | Additional Quota ER | Money | Add |
| Additional Quota Social Security Taxable | Additional Quota Social Security Taxable | Money | Add |
| Additional Quota Social Security Subject | Additional Quota Social Security Subject | Money | Add |
| Benefits in Species EE | Benefits in Species EE | Money | Add |
| Benefits in Species ER | Benefits in Species ER | Money | Add |
| Benefits in Species Social Security Taxable | Benefits in Species Social Security Taxable | Money | Add |
| Benefits in Species Social Security Subject | Benefits in Species Social Security Subject | Money | Add |
| Benefits in Cash EE | Benefits in Cash EE | Money | Add |
| Benefits in Cash ER | Benefits in Cash ER | Money | Add |
| Benefits in Cash Social Security Taxable | Benefits in Cash Social Security Taxable | Money | Add |
| Benefits in Cash Social Security Subject | Benefits in Cash Social Security Subject | Money | Add |
| Input Value Name | Balance Name | Units | Add or Subtract |
|---|---|---|---|
| Disease and Maternity EE | Disease and Maternity EE | Money | Add |
| Disease and Maternity ER | Disease and Maternity ER | Money | Add |
| Disease and Maternity Social Security Taxable | Disease and Maternity Social Security Taxable | Money | Add |
| Disease and Maternity Social Security Subject | Disease and Maternity Social Security Subject | Money | Add |
| Disability and Death EE | Disability and Death EE | Money | Add |
| Disability and Death ER | Disability and Death ER | Money | Add |
| Disability and Death Social Security Taxable | Disability and Death Social Security Taxable | Money | Add |
| Disability and Death Social Security Subject | Disability and Death Social Security Subject | Money | Add |
| Day Care Centers EE | Day Care Centers EE | Money | Add |
| Day Care Centers ER | Day Care Centers ER | Money | Add |
| Day Care Centers Social Security Taxable | Day Care Centers Social Security Taxable | Money | Add |
| Day Care Centers Social Security Subject | Day Care Centers Social Security Subject | Money | Add |
| Work Risk Incident EE | Work Risk Incident EE | Money | Add |
| Work Risk Incident ER | Work Risk Incident ER | Money | Add |
| Work Risk Incident Social Security Taxable | Work Risk Incident Social Security Taxable | Money | Add |
| Work Risk Incident Social Security Subject | Work Risk Incident Social Security Subject | Money | Add |
| Input Value Name | Balance Name | Units | Add or Subtract |
|---|---|---|---|
| Pensioners Medical Expenses EE | Pensioners Medical Expenses EE | Money | Add |
| Pensioners Medical Expenses ER | Pensioners Medical Expenses ER | Money | Add |
| Pensioners Medical Expenses Social Security Taxable | Pensioners Medical Expenses Social Security Taxable | Money | Add |
| Pensioners Medical Expenses Social Security Subject | Pensioners Medical Expenses Social Security Subject | Money | Add |
| Retirement EE | Retirement EE | Money | Add |
| Retirement ER | Retirement ER | Money | Add |
| Retirement Social Security Taxable | Retirement Social Security Taxable | Money | Add |
| Retirement Social Security Subject | Retirement Social Security Subject | Money | Add |
| Separation due to Age EE | Separation due to Age EE | Money | Add |
| Separation due to Age ER | Separation due to Age ER | Money | Add |
| Separation due to Age Social Security Taxable | Separation due to Age Social Security Taxable | Money | Add |
| Separation due to Age Social Security Subject | Separation due to Age Social Security Subject | Money | Add |
| INFONAVIT EE | INFONAVIT EE | Money | Add |
| INFONAVIT ER | INFONAVIT ER | Money | Add |
| INFONAVIT Social Security Taxable | INFONAVIT Social Security Taxable | Money | Add |
| INFONAVIT Social Security Subject | INFONAVIT Social Security Subject | Money | Add |
| Dimension | Dimension Name |
|---|---|
| PER_GRE_YTD | Person Within GRE Year To Date |
| PER_GRE_MTD | Person Within GRE Month To Date |
| PER_PAYROLL_GRE_PTD | Person within Payroll and GRE Period To Date |
| ASG_GRE_YTD | Assignment Within GRE Year To Date |
| ASG_GRE_MTD | Assignment Within GRE Month To Date |
| ASG_GRE_PTD | Assignment Within GRE Period To Date |
| PER_GRE_SS_BIMONTH | Person within GRE for Social Security Bi-Month |
| ASG_GRE_ITD | Assignment Within GRE Inception To Date |
To support Balance Initialization functionality, Oracle HRMS provides the pay_mx_bal_upload balance upload package. This package contains the following functions and procedures:
| Function/Procedure | Description |
|---|---|
| pay_mx_bal_upload.expiry_date | Returns the expiry date for a dimension at the effective (balance upload) date. |
| pay_mx_bal_upload.is_supported | Identifies if a dimension name is supported in balance upload. |
| pay_mx_bal_upload.include_adjustment | Determines if a calculated balance adjustment (such as a balance upload value) affects the current dimension. It does this by checking the adjustments already made for the balance and determining if these affect the passed-in defined balance, taking into account any contexts. Use this function to check whether the specified dimension is included in previous adjustment. If the Run Type of the previous balance adjustment is the same as the Batch Line Run Type, the specified dimension is included. If the dimension is not relevant to the run type, that balance is always included. |
| pay_mx_bal_upload.validate_batch_lines | Applies any Mexico-specific validation to the balance upload data. There is no additional processing or validation required, so this is a null procedure. |
Oracle HRMS provides balances to support the following features:
IDW, Oracle HRMS Payroll Processing Management Guide
Social Security Quotas, Oracle HRMS Enterprise and Workforce Management Guide
ISR Tax, Oracle HRMS Payroll Processing Management Guide
Year End Archiver, Oracle HRMS Payroll Processing Management Guide
Employer State Tax, Oracle HRMS Payroll Processing Management Guide
Profit Sharing, Oracle HRMS Payroll Processing Management Guide
Oracle Payroll users can define secondary classifications to create subsets within primary classifications. You decide which elements, from a primary classification, are in each secondary classification, then you use the secondary classification to feed balances.
Note: If you are an HR-only user, you cannot define secondary classifications. For more information on user types and the associated HR: User Type profile option, see: User Profiles, Oracle HRMS Configuring, Reporting, and System Administration Guide.
To create secondary element classifications
Query a primary element classification. The check box indicates whether it is for nonpayment elements. These are elements that do not feed the Payments balance.
On the Priority, and Costing tabs, you can view the following information about the classification:
Priority: The processing range displays together with the default priority.
Costable: If this check box is checked, you can select all costing options on the element link for elements of this classification, including Not Costed.
Distributable: If this check box is checked, you can create a distribution set from elements of this classification over which you can distribute costs.
Debit or Credit: These option buttons display the cost type for elements in the classification, that is, whether the accounts they feed are to be debited or credited.
On the Frequency Rules tab, you can view the following information about the classification:
Enabled: If this check box is checked, you can define frequency rules for elements of this classification. The payroll run uses a frequency rule to determine in which pay periods it processes a recurring element.
Date: The date the payroll run uses, by default, to assess frequency rules in your localization. You can select a different date when you define a frequency rule.
Enter a unique name for the secondary classification you want to associate with the displayed primary classification. You can also add a description.
Select the Default check box if you want all elements in the primary classification to be in the secondary classification by default. Then, if there are any exceptions, you must manually remove these elements from the secondary classification. You can do this at any time using the Balance Feed Control window, which opens from the Element window.
Note: For some legislations, Oracle Payroll has already defined a number of secondary classifications. Some of these are default classifications, but not all. You cannot delete these classifications, and you cannot delete them from the Balance Feed Control window for predefined elements.
Use the Balance Feeds window to select balances to be fed by the input values of an element. Balances are either fed by whole classifications of elements or by individual elements, but not by both. Therefore, in this window you cannot select balances that are fed by classifications. You can query a balance in the Balance window and choose the Classifications button to view the list of classifications that feed it.
You can use an element to feed as many balances as you require.
To create balance feeds for one element
Set your effective date to when you want the balance feed to start.
Enter or query the element in the Element window and choose the Balance Feeds button.
In the Balance Feeds window, select the input value that you want to feed the balance with.
The list displays all the input values defined for the element. These input values may have different units of measure. When you select an input value its unit of measure displays in the Units field. To feed a balance with the element's direct run result, select Pay Value.
Select the balance you want the input value to feed.
The list restricts your choice to balances having the same unit of measure as the input value you selected.
Select Add or Subtract for the balance feed.
Note: Secondary classifications and balance feed controls currently do not apply to the US version of Oracle Payroll.
In the Balance Feed Control window, you can classify an element using secondary classifications. These determine the balances that the element feeds. You can query a balance in the Balance window and choose the Classifications button to view the list of classifications that feed it.
To select or remove secondary element classifications
Set your effective date to when you want the element to begin feeding the balances that the secondary classifications feed.
Enter or query the element in the Element window and choose the Balance Feed Control button.
In the Balance Feed Control window, delete any default secondary classifications you do not require for the element.
When this window opens, it displays any default secondary classifications for the element's primary classification. Unless they are predefined, you can delete any of these classifications, and you can change their effective start dates.
Select any non-default secondary classifications you require.
Defining a balance includes defining its feeds and dimensions. When selecting feeds for the balance you have to choose between specifying element input values directly, and selecting element classifications to determine the feeds. You cannot choose both methods together.
You can group similar balances - such as all earnings balances - in a single category for quicker and easier processing. Each localization has a defined set of categories. If there are no categories in the list of values, this means your legislation is not yet using the category functionality.
Balances often share a common relevancy to certain assignments. In some localizations, you can define base balances to imply a relationship between the balances that can be relied upon when processing and reporting. For example, "Loan Repayment" could be the base balance for "Loan Repayment Arrears".
You define balances in the Balance window.
To define a user balance
Do one of the following:
Enter a unique name and a reporting name for the new balance. If you do not provide a reporting name, the first seven characters of the balance name appear on reports.
Query any user balances you want to change.
Optionally, select a balance category in the Category field.
Australian Users: Attach all user-defined balances to the relevant balance category and to the _ASG_RUN and _ASG_YTD dimensions to populate the run balances. You must attach all user-defined allowance balances required to be reported individually on the Payment Summary to the Balance Category of Allowance and to the _ASG_LE_RUN and _ASG_LE_YTD dimensions.
New Zealand Users: You must assign a balance category for each element that you define.
Optionally, select a Base Balance.
Enter the unit of measure for the balance. The choices are days, hours (listed in different formats), integer, money and number. If you select money as the unit you must also select a currency.
Note: Do not select the Use for Remuneration check box. This displays the balance that has been predefined as the Remuneration balance. Only one balance within a legislation can have this value.
To define a primary balance - one fed by a single element - select an element and input value in the Primary Balance region (if this region is available for your localization).
Go to the Balance Feeds window or the Balance Classifications window.
Set your effective date to the start date for the balance feeds.
Select one or more elements to feed the balance. Only those elements whose input values have the same unit of measure as the balance are listed.
When you select an element, its classification is displayed. You can select elements with different classifications.
Select the input value that is to feed the balance.
For most payroll balances select Pay Value so that the element's run result feeds the balance.
Select Add or Subtract for the balance feed.
Select one or more element classifications and select Add or Subtract for each. The run results of all elements in the classification will feed the balance.
The list includes all the primary and secondary element classifications that are valid for this balance. If you select a secondary classification, you cannot also select its parent primary classification.
Note: Secondary classifications are not used in the North American or Singapore versions of Oracle Payroll at this time.
Choose the Dimensions button.
Select the dimensions you require.
New Zealand Users: For each new balance, you must attach the balance dimension _ASG_RUN for it to generate run balances.
Australian Users: Select the _ASG_RUN and _ASG_YTD dimensions for all user-defined balances. You must attach the _ASG_LE_YTD and _ASG_LE_RUN dimensions to the allowance balances required in the Payment Summary reports.
You can remove any dimension previously selected for a user-defined balance. You can also add dimensions to the startup balances included with your system, and later remove these additional dimensions. However, you cannot remove the dimensions that were predefined for the startup balances.
Note: To hold balances for a fiscal year that is different from the calendar year, you must supply the fiscal year start date for your Business Group.
Optionally, select the Grossup Balance check box for one of the dimensions, to make the balance eligible for grossup.
UK users: If you want to make the balance eligible for grossup, you must select this check box for the _ASG_RUN dimension.
Choose the Initial Feed button.
In the Initial Balance Feed window you can see details of the element and input value used for the Initial Balance feed. This feed is defined by implementation consultants prior to performing an initial balance upload at implementation time.
Choose the Attributes button.
Select an attribute definition and a dimension.
Balance attributes identify which balances can be used in which reports. Attributes can be predefined by localizations, created as a result of predefined defaults, or you can enter them in this window.
Note: For UK SOE Balances, ensure you attach the attribute to the Balances1 segment in the Business Group Information. Attach the attribute to each balance you want to display on the Online SOE. For every balance with an attached attribute, you must add individual balance to the SOE Details Information (in the Business Group Information).
The balances you attach to the SOE Details Information are defined at business group level, hence even if you change the user category profile it will not have any result on the data defined in the SOE Details Information.
Additional Information: Saudi Users: Oracle Payroll provides Saudi SOE Balance Attributes to view the SOE report. You can use the predefined balance attributes or create your own balance attributes.
Setting initial values for balances is an essential task for new customers migrating from other systems.
Such balances typically consist of both legislative and customer defined balances. For example, a legislative balance could be the amount of tax deducted for each employee during the tax year. A customer defined balance could be the number of vacation days taken by each employee during the calendar year.
The correct initial setting of these balances is essential for subsequent processing to be valid.
The Initial Balance Upload process allows the specification and loading of initial balances into the system. System implementers use this process once only, on migration. After that, balance maintenance is carried out automatically by Oracle Payroll.
To load initial balances into Oracle Payroll
Define an element and input value for the initial balance feed. Select the classification Balance Initialization for this element.
Set up initial balance values in the tables
PAY_BALANCE_BATCH_HEADERS
PAY_BALANCE_BATCH_LINES
For more information, see the technical essay: Balances in Oracle Payroll, Oracle HRMS Implementation Guide.
In the Submit Requests window, select Initial Balance Upload.
Run one or more of the four modes as appropriate:
Validate: checks the details in the batch to be uploaded
Transfer: creates the balances in the batch
Undo transfer: reverses the effects of a transfer
Purge: removes the batch from the batch tables
Select the batch to be processed.
Choose the Submit button.
Continue to run the process for as many modes as you require.
Oracle Payroll enables you to make both single and recurring deductions from worker salary for third party payments, and to specify either corporate bodies or individuals as payees. The deductions you can make include third party payments and union dues.
You need to define payment methods for third party payments and enter these for your payrolls.
How you pay third parties is determined by the Third Party Payment check box on the Element window when you define the deduction. If this check box is unchecked, you must pay third parties outside Oracle Payroll through Accounts Payable. If it is checked, you can pay third parties through Oracle Payroll, using a third party payment method that you have defined.
Third party payments is also known as Wage Attachments, Wage Garnishments, and Court Orders in different localizations, and your legislation may already have predefined elements to support each of these types of deduction.
Third party payments are deductions from earnings incurred by court debts or fines. For example, payments of maintenance, child support or other legally incurred obligations. Oracle Payroll enables you to process these deductions from worker wages. Third party payments in Oracle payroll are rule-driven, so you can tailor them to meet your business needs.
Oracle Payroll provides a robust answer to administering third party payments, a type of involuntary deduction. Like other features in Oracle HRMS, third party payments are rule-driven so that you can tailor the software to fit your business requirements.
Oracle Payroll features for third party payments enable you to:
Create third party payments
Determine which earnings are eligible for third party payments
Administer fees for recouping processing costs of third party payments (if administrative fees are payable for your legislation)
Establish the priority of payments if a worker has several third party payment obligations that cannot be met in a single pay period
Stop making third party payments when your worker has discharged the obligation
Oracle Payroll handles third party payments using:
Elements and input values
Formulas
Balances and balance feeds
Depending on the country in which you operate, third party payments are either provided for you, along with their associated elements, balances, balance feeds and formulas, or you can create your own. To create your own, enter some of the information you require into a template, and let Oracle Payroll generate the elements, balances and balance feeds for you. You create North American third party payments using this second method.
You can only use one of the two methods, depending on your legislation, and not a mixture of both.
Each third party payment is represented by one element. For example, the third party payment of Court Order is represented by the element called Court Order.
Once you have created a third party payment, or selected one of the third party payments provided, you record all changes by entering input values for the third party payment element.
You determine when to deduct each third party payment from a worker's earnings using element classifications and processing sequences.
For example, you may need to ensure that Oracle Payroll always processes court orders before other deduction types. You may also need to prioritize the court orders further to ensure that Oracle Payroll always processes child support deductions before education loans. In this example, these third party payments belong to an element classification with a low-numbered processing sequence. This ensures that they are processed before all other deductions.
Then, to ensure that Oracle Payroll always processes your child support payments before education loans, you could determine a secondary processing sequence. You do this in the Element Entries window.
If you don't specify a secondary processing sequence, third party payments are processed in date order.
During payroll processing, the appropriate formula calculates the deduction from the worker's wages, and considers the correct percentage of the balance which stores the worker's net income.
Korea users only: While processing your third party payment, use only the KR Monthly Payroll, KR Bonus Payroll, and KR Separation Pay Payroll processes. If you use QuickPay Run, the third party payment will not be properly processed because you cannot specify its payout date.
You can use the predefined formulas to determine how third party payments are processed in your organization. For example you can do the following:
Determine the amount of pay that is liable for third party payment deduction. For example, the worker's take home pay after tax and other deductions, and the amount that is protected or exempt from third party payment deductions. During payroll processing, a formula calculates the deduction from the worker's wages. During calculation, 50 percent of the Attachable Earnings balance is considered; this balance stores the worker's net income. Irrespective of the payroll run type, only 50 percent of Attachable Earnings will be considered.
Calculate the amount to withhold. The third party payment court order provides the amount to be withheld per pay period and a total amount due. If you do not enter a pay period, Oracle Payroll defaults to the maximum amount allowed by law. The amount withheld can also include any arrears owing or any fees payable to the employer for setup and administration of the deduction.
Verify the amounts withheld. After Oracle Payroll has calculated all third party payments for a worker, the relevant formula checks that all rules and limits applicable to these payments are accounted for. If it finds any violations, the formula makes adjustments to the previously calculated amounts, prorating them and creating arrears amounts if necessary.
See: Formulas and Payroll Run Results
Oracle Payroll uses balances to record the amount of third party payments paid or amount remaining. Depending on your legislation, Oracle Payroll either provides the balances and balance feeds that you need for predefined third party payment elements, or it generates them automatically.
The amount of court order debt paid at any time is held in an Inception-to-date (ITD) balance. For those elements that have multiple occurrences, this balance exists at element level, reflecting the need to keep track of how much has been paid for each separate occurrence. Otherwise the balance exists at assignment level.
The amount of the debt still outstanding is the difference between the amount in the ITD balance dimension and the Initial Debt input value.
For Assignment level ITD balance dimensions, you must ensure that, once the total debt has been repaid and the element has been given an end date for processing, that the balance is cleared back to 0.00. If you do not do this and a new element entry is given to the worker for the same court order type element, the formula finds the 'old' balance and the element is not processed correctly.
The attachable pay balances Run and Period balance are referenced within the formulas because of the possibility of there being more than one run in a period.
You enter the initial debt. The system then manages the deductions automatically and ends the process when the debt is cleared. If you do not enter a value for the debt the system continues to process the deductions each pay period as ongoing maintenance payments.
Local legislation determines the amount and type of earnings from which third party payments can be deducted. Typically, there is a minimum amount of earnings below which you cannot deduct third party payments. Similarly, there is a proportion of a worker's earnings that are considered liable to third party payment deductions.
You can use Oracle Payroll to manage both kinds of third party payment:
Where the total amount of the deduction is known in advance, for example, a fine.
Where the total amount is not fixed, but you must make a deduction from each salary payment, for example, child maintenance orders.
Depending on the third party payment, and whether the deduction is ongoing or a diminishing balance, you can set a deduction end date. Alternatively you can set up the deduction so that Oracle Payroll stops processing it when the full balance has been paid.
You can also override these settings, for example, if you want to stop maintenance payments immediately before reaching the end date.
If a worker's third party payment is still being processed after the worker has left the organization, then you must manually enter deposition-related information into the Deposition Info predefined element. This element is for informational purposes only. Your company will request the court that has mandated the third party payment to stop the process, and the court will be sent the information contained in the element.
The third party payments that you can process depend on the specific third party payments that apply to your legislation. Examples of third party payments include child support payments, educational loans, taxes to local authorities, alimony, and bankruptcy orders.
The following table lists the deductions you can make using Oracle Payroll.
| Third Party Payment | Legislation |
|---|---|
| Credit Debt/Garnishments | US |
| Bankruptcy Order | US |
| Federal Tax Levy (State and Local Tax Levies are not supported by Oracle Payroll) | US |
| Federal DCIA Order | US |
| Spousal Support Order, Child Support Order, and Alimony | US |
| Educational Loan | US |
| Employee Requested Payment | US |
| Court Orders and Arrestments | UK |
| Council Tax Attachments | UK |
| Court Orders | France |
| Maintenance Orders | Ireland |
| Variation Orders | Ireland |
| Interim Orders | Ireland |
| Compensation Orders | Ireland |
| Social Welfare Orders | Ireland |
Use this process to make third party payments through Oracle Payroll. Third party payments include
Wage Attachments
Wage Garnishments
Court Orders
In Australia, you can also use this process to set up employer superannuation contributions. After payroll processing takes place, the pay value of the deductions element is paid according to the third party payments method you selected.
To make third party deductions from individual assignments
Create the organization or person to receive the third party payment.
You create payee organizations in the Organization window, selecting the Payee Organization classification.
See: Creating an Organization, Oracle HRMS Enterprise and Workforce Management Guide
You create individual payees as contacts of the person making the deduction. In the Contacts window, check the Payments Recipient check box when you create the payee.
See: Entering Next of Kin and Other Contacts, Oracle HRMS Workforce Sourcing, Deployment, and Talent Management Guide
Link the third party element to your payroll.
In the Personal Payment Method window, select a third party payment method for the assignment. In the Payee region, select the payee you have created.
See: Entering Payment Methods for an Employee Assignment, Oracle HRMS Workforce Sourcing, Deployment, and Talent Management Guide
Create an element entry for the deduction.
See: Entering Third Party Payment Information
In the Entry Values window, you enter details of payment, payee and payment method. Required entry information varies according to the kind of deduction you are making.
When you have completed these setup steps you can run a payroll to process the third party payment that you have just defined.
Information about each Third Party Payment that must be discharged against your worker is stored in a separate third party payment element.
Third party payments can include Wage Attachments, Wage Garnishments, and Court Orders and your legislation may already have predefined elements to support each of these types of deduction.
Use the Element Entries window to assign your worker a Third Party Payment element.
To enter Third Party Payment for a worker
Query your employee in the People window, and set your effective date to the day on which the third party payment should commence for your worker.
In the Element Entries window, select the third party payments element .
Enter costing information in the Cost Allocation KF window or choose Cancel.
Choose the Entry Values button to open the Entry Values window.
Enter the unique attachment sequence number of the third party payment.
You must supply a unique attachment sequence number for your third party payment; otherwise, your payroll run will fail. After your payroll run is successfully processed, in the Result Values window, you can identify the Results element created for your third party payment by its attachment sequence number.
Enter the time you received the third party payment and the unique case number assigned by the court administering the third party payment.
Select the third party payment's processing type.
Enter the third party payment's sub-processing type and administering court's name. The sub-processing type is used by the system only for information and is not considered during calculation or administration of the third party payment.
Enter the principal base and court fee base for the third party payment.
If the third party payment has an interest base, enter it. Enter the start and end dates for the interest base. The start and end dates for a third party payment that has an interest base are only for information and have no bearing on administration or calculation.
Indicate whether or not a judicial decision statement of the obligation-release processing type has been received for the third party payment and the date of such receipt. To set the Obligation Release field to Yes, you must update the field.
When the third party payment's processing type changes to obligation release from any other processing type, you must select Yes in the Obligation Release field. You do not need to assign a new third party payments element to the employee
Select the third party creditor for the court order from the list of values in the Payee Details field.
Save your work.
To enter interest bands
If the third party payment has interest bands, then you need to specify them in the Further Element Entry Information window:
Click in the Further Entry Information field to open the Further Element Entry Information window.
Specify the start date, end date, base, and rate of each interest band. You can specify a maximum of five interest bands. A interest band is invalid if it does not have a start date. If an end date is not specified, the system uses the next applicable payout date.
Save your work.
To change processing type from provisional attachment to actual seizure and collection, actual all attachment
Some localizations enable you to specify whether a third party payment is a provisional attachment, an actual seizure and collection, or an actual all attachment.
When the processing type of the third party payment changes from provisional attachment to actual seizure and collection or actual all attachment, you must assign a new third party payments element to the employee in the payroll-processing period in which the processing type changes.
In the Element Entries window, enter information pertaining to the new judicial decision statement.
If the third party payment uses an interest base, enter the same values for the principal base, court fee base, and interest base that you entered for the old third party payments element.
If the third party payment uses interest bands, enter the same values for the principal base and court fee base that you entered for the old third party payments element. While setting up interest bands, begin with the interest band within which the next payroll-processing date will fall. The start date of this band should be the last payout date for the old third party payments element.
Select the case number for the old judicial decision statement for the third party payment in the Further Element Entry Information window.
Save your work.
Historic rates is a function that retrieves a datetracked money value and recalculates it according to different time-dimensions (converting a daily wage to hourly). Historic rates is primarily for use in FastFormulas. You can use it to determine employee payments at the rate that existed when the work was done, rather than at the current rate. For example: If you pay your employees in arrears, you can calculate the value of the arrears payment.
Historic rates apply to notional rates only and not to actual rates
An employee may earn $50 an hour. Assuming a 40 hour work week, their notional rate would be $2000 a week. However, that employee might have only worked 10 hours during a particular week. Therefore, their actual rate for that week would be $500.
Historic rates are the values of a specific element or combination of elements, based on a specified time dimension, at a specified date. You can vary the rate according to different factors, such as:
Full Time Equivalent (FTE)
A percentage of another rate
For most rate calculations, a single element provides the pay rate. However, some rate calculations are the sum of multiple elements. For example: A holiday rate could be basic pay (held as a progression point) plus shift allowance (an input value) plus bonus (a global value). A rate type is a grouping of elements that comprise a single pay rate.
Different rate types can use the same element. For example: A rate type for holiday and another for sickness can both use the same basic pay element.
Use the Historic Rate - Rate Type element EIT to store the rate type name and description against each element. You create additional rate types by adding values to the lookup type PQP_RATE_TYPE.
To calculate pay using historic rates, use the GET_HISTORIC_RATE function in your payroll formula. This function returns the rate. The parameters for the function are:
The element, or group of elements (a rate type)
The time dimension (such as hourly)
The effective date
For sample formulas using this function, see: Sample Rates History Formula, Oracle HRMS FastFormula User Guide
The function uses attribution at two levels to calculate the correct values:
Element
Contract
Note: The Contract level is available only if your localization has enabled it.
Use the Historic Rate - Element Attribution (an element EIT) to store the following information against each element that has a historic rate:
Time dimension (hourly, daily, and so on)
Pay source value (input value, grade rate, and so on)
Name of the pay source
Full Time Equivalent indicator
Service history
Assignment association
Rate adjustment options
For example, assume an assignment has an element entry for a Salary element and the element has the following attribution:
Time dimension = Hourly, Source = Grade Rate, Qualifier = Grade Rate 1
The function can retrieve the salary from Grade Rate 1 at any time and convert the time dimension from hours to annual or another dimension.
If you store rates for this payment using more than one grade rate or scale rate, you can use wildcards to enable you to select the latest value in the Qualifier field. For example: If the rate for salary can be held in Sal Scale Rate 1 or Sal Scale Rate 2, you can make the wildcard entry Sal Scale Rate % in the Qualifier field. The historic rates function then retrieves the value with the latest effective date.
The Contract Table is available only to those localizations that have enabled it. The structure of this table is defined by the localization. The user must specify the values.
Mexico only: This table is defined and maintained by the localization. It is not available to users.
Use the PQP_CONTRACT_TYPES predefined user-defined table to store the following information about your employee contract details:
| Value | Definition |
|---|---|
| Annual Hours | Number of contract annual hours. Use this figure in the conversion of the derived rate to an output time dimension of "H" (Hourly Rate). Also use Annual Hours as a required figure when calculating Full Time Equivalent (FTE). |
| Days Divisor | Number of contract days in a year. This divisor is normally 365. Use it in the conversion of the derived rate to an output time dimension of "D" (Daily Rate). |
| Period Divisor | Number of periods per year used to calculate an output time dimension of "P" (Periodic Rate). Use a divisor that corresponds to the working hours shown on the Assignment window. For example: Weekly working hours have 52 as the Period Divisor. Also use Period Divisor as a required figure when calculating Full Time Equivalent (FTE). |
| Weekly Payroll Divisor | Number of periods per year, such as 52. Use the weekly payroll divisor to convert a periodic value into an annual value when Periodic - Payroll Frequency is the time dimension for the element, and the payroll is weekly or bi-weekly. |
| Monthly Payroll Divisor | Number of periods per year, such as 12. You use the monthly payroll divisor to convert a periodic value into an annual value when you select Periodic - Payroll Frequency as the time dimension for the element and the employee has a payroll frequency of Calendar Month, Lunar Month, Bi-Month, Quarter, Semi-Year, or Year. |
When you have entered the required information to the PQP_CONTRACT_TYPES table, you can also add the following:
| Value | Definition |
|---|---|
| Overtime Annual Hours | Number of annual hours used to calculate an output time dimension of "O" (Overtime Hourly Rate). |
| Annual Term Time Hours | Calculates the adjustment value for the derived rate. If you enter a value for this column, and for the Annual Hours column, this adjusts the derived rate by a factor of Annual Term time Hours divided by Annual Hours. |
| Employment History Factor | Value the function uses to adjust the historic rate for length of service. There are five bands within this category. For each of band you can define the following:
The historic rates function uses this information about each contract type to convert values held for one time dimension to another dimension. For example: If a rate is held hourly and needs to be returned as a daily rate, the function calculates an annual value by multiplying the rate by Annual Hours, then divides this by the Days Divisor. |
Time dimensions are closely tied to contracts. If you have a time dimension, you must use contract types. If you are doing a conversion between two time dimensions, you must refer to a contract.
You define source time dimensions in the PQP_TIME_DIMENSIONS extensible lookup type. Whenever you add a new dimension to this lookup, you must also make a corresponding entry in the PQP_TIME_DIMENSION_FACTORS lookup type. This corresponding entry ensures that your output time dimensions map correctly to the annualization factor in the PQP_CONTRACT_TYPE user table.
| Code | Meaning | Description |
|---|---|---|
| A | Annual | Annual |
| D | Daily | Daily |
| H | Hourly | Hourly |
| P | Periodic | Periodic |
| PAY | Periodic - Payroll Frequency | Periodic - Payroll Frequency |
| Code | Meaning | Description |
|---|---|---|
| A | Reserved Per Annum Frequency | Annual |
| D | DAYS DIVISOR | Daily |
| H | ANNUAL HOURS | Hourly |
| O | ANNUAL OVERTIME | Overtime Hourly |
| P | PERIOD DIVISOR | Periodic - Contract Period |
| PAY | Reserved Pay Period Frequency | Periodic - Pay Period Frequency. |
The GET_HISTORIC_RATE function converts the element rate into an annual rate before converting to the given output time dimension. Therefore, not all output time dimensions need a corresponding source time dimension. For example, you can retrieve the overtime hourly rate (time dimension "O") without defining a rate with a source frequency of Overtime Hourly.
See: Setting Up Custom Time Dimensions for Historic Rates
For proper Integrated Daily Wage calculation, you must define the following Historic Rates EITs:
| Rate Types Parameters | Description |
|---|---|
| Rate Type Name | Specifies the type of earning. Select Fixed IDW, Variable IDW, or Base Pay. |
| Element Attribution Parameters | Description |
|---|---|
| Time Dimension | Use this field to specify if the calculated value is an annual, periodic, daily, or hourly value. Oracle Payroll uses this value to select the correct divisor to convert the value into a daily amount. |
| Pay Source Value | Use this field to specify how Oracle Payroll derives the IDW value for this element.
|
| Qualifier | Use this field to specify the name of element, rate type, or input value from which the IDW is derived. Available values are dependent on what you selected as the Pay Source Value. |
| % or Factor | Use this field to specify if the IDW value for the element is derived as a percentage or a multiple of the pay source value specified earlier. Use this field only if you selected element or rate type as the pay source value. |
| % or Factor Value | Use this field to specify the value of the percentage or the factor to be applied to the result. Use this field only if you have selected a value for the % of Factor field. |
Follow these steps to set up the Historic Rates function.
To set up Historic Rates
You (or your system administrator) register the following element EITs with your responsibility:
PQP_ELEMENT_ATTRIBUTION
PQP_RATE_TYPE
See: Setting Up Extra Information Types Against a Responsibility, Oracle HRMS Configuring, Reporting and System Administrators Guide
Create additional rate types by adding values to the lookup type PQP_RATE_TYPE.
Set up elements to represent the payments used in your enterprise.
Enter the following attribution:
Classification of earnings
Recurring processing type
Final close on termination
Note: To use proration with historic rates, choose actual termination.
Process each period
To use a formula calling a version of the historic rates function requiring date parameters, give each element an Input Value that has the same name as the formula input.
Enter extra information using the Historic Rate - Rate Types and Historic Rate - Element Attribution EITs for all elements with historic values.
See: Historic Rates Extra Information Types, Oracle HRMS Compensation and Benefits Management Guide
Define element links for all the elements.
If your localization has enabled the Contracts Table:
Enter contract information in the pre-configured user-defined table PQP_CONTRACT_TYPES.
Add one row for each new contract type you want to set up.
If you hold rates on input values and use the Period Divisor on the Contract Types table to convert the period value to an annual value (such as, Time Dimension = Periodic on the Element Attribution Information for your elements), you must create at least one contract type for each payroll frequency. For example: You must assign employees on a weekly payroll to a separate contract type from employees on a monthly payroll. This requirement does not apply if you select the Periodic - Payroll Frequency time dimension, which uses the weekly or monthly payroll divisor held on the Contract Types table to convert period values to annual.
See: Entering Contract Types, Oracle HRMS Workforce Sourcing, Deployment and Talent Management Guide
Assign people to contract types by selecting contract type and start date in the Extra Details of Service window.
To make your rates subject to FTE, enter Working Hours and Frequency in the Assignment window.
See: Setting Up FTE, Oracle HRMS Workforce Sourcing, Deployment and Talent Management Guide
Write the payroll formula to derive the rate from the information you have set up (using the RATES_HISTORY function).
See: Sample Rates History Formula, Oracle HRMS FastFormula User Guide
In the Formula Result Rules window, associate each payroll formula with an element.
Create a Standard processing rule.
In the Formula Results region, select the Amount formula result as a direct result returning a pay value for the element.
Select the Message result as a message type delivering a fatal error.
In addition to the predefined time dimensions, you can set up your own custom time dimensions to reflect working patterns in your enterprise. For example: You can set up an additional daily frequency based on a fixed number of working days a year.
Custom time dimensions are available only to those localizations that have the PQP_CONTRACT_TYPES table enabled and accessible to users.
Use the Application Utilities Lookups window and the Table Structures window to enter custom time dimensions for historic rates.
To set up custom time dimensions for historic rates
In the Application Utilities Lookups window, create a new entry in the PQP_TIME_DIMENSIONS_FACTORS lookup.
For example, to define an additional Daily frequency based on a fixed number of working days a year, create the following entry:
| Code | Meaning | Description |
|---|---|---|
| WD | WORKING DAYS DIVISOR | Working Days per Year |
In the Table Structures window add a new column to the PQP_CONTRACT_TYPES table. Give the new column the same name as the meaning entry that you created in the previous step. For example, to amend the PQP_CONTRACT_TYPES table to accept your new Daily frequency, add a column called WORKING DAYS DIVISOR.
To define an element rate for your new custom time dimension, go back to the Application Utilities Lookup window and add your new lookup code to the PQP_TIME_DIMENSION lookup type.
For example, to define an element rate as Daily - Working rate, add this entry to the PQP_TIME_DIMENSION lookup. Use your previous lookup code (WD):
| Code | Meaning | Description |
|---|---|---|
| WD | Daily - Working | Daily rate based on the working days per year |
Save your work
Employers must pay an amount equal to 5% of each employee's wages to the Federal Workers Housing Fund (INFONAVIT). You must pay these quotas on a bi-monthly basis.
Oracle HRMS for Mexico supports the calculation and tracking of INFONAVIT loads and their repayment.
To perform these operations:
Use the SUA application to compute and report your INFONAVIT quotas, Oracle HRMS Enterprise and Workforce Management Guide
To set up your employee assignments and payroll processing for automatic INFONAVIT deductions:
Use the Element Design Wizard to create an element with a Voluntary Deductions primary classification.
Set session_date to the effective start date of the element.
In the Element Description form, query for the element you just created.
Click Input Values and create the following input values:
| Name | Units | Selected check boxes |
|---|---|---|
| Credit Number | Number | Required User Enterable Database Item |
| Credit Start Date | Date | Required User Enterable Database Item |
| Discount Type | Character | Required User Enterable Database Item |
| Discount Value | Number | Required User Enterable Database Item |
Save your work.
Click Extra Information.
The Extra Element Information window opens.
Select the Deduction Processing type.
Click inside the Detail field, and specify INFONAVIT as the Type of Deduction.
Save your work.
Link this element.
Attach this element to an assignment, and enter appropriate input values.
These input values appear in the Social Security Archiver section of the Person Information window.