Using Oracle HRMS, you can set up payrolls to pay all your employees accurately and at the correct time.
A payroll is a set of employees whose pay you process with a single frequency, for example, weekly or monthly. You can define as many payrolls as you require to meet the pay policies of your enterprise. You put an employee on a payroll by making an assignment to the payroll.
You can also assign employees to other employee groups: for example, groups to indicate membership of a union or employment based sports club.
To enable you to set up payrolls correctly, you need to understand these key concepts:
Consolidation sets, Oracle HRMS Payroll Processing Management Guide
Assignment sets, Oracle HRMS Payroll Processing Management Guide
Element sets and distribution sets, Oracle HRMS Compensation and Benefits Management Guide
See Reports and Processes in Oracle HRMS, Oracle HRMS Configuring, Reporting, and System Administration Guide
Use the Payroll window to define a payroll, including its calendar and valid payment methods.
Set your effective date to a date early enough to handle any historical information you want to enter. Your effective date must be on or before the first period start date of the payroll calendar.
Enter the payroll's name and select its period type from the list.
Enter the end date of the payroll's first period, and the number of years for which the system should initially generate the payroll's calendar. You can increase this number later to generate additional years.
Note: Be aware that some processes require the calendar to extend into the future. For example, the PTO Carry Over process requires payroll periods extending to the end of the new accrual term.
When you enter the First Period End Date, make sure that the corresponding start date of the first period is after the start date of the payroll.
In the Date Offset region, you can change the zero default to a negative or positive number of days before or after the period end date. For example, for a semi-monthly payroll, the Cut Off date can be 3 days before the period end date (-3), while the Scheduled Run and Check dates can be 5 and 7 days after this date, respectively. You can also set the Payslip offset to determine when employees can view payslip information.
The Check Date, sometimes called Pay Date, is the date of constructive receipt of pay, on which paychecks become negotiable.
The Scheduled Run Date is the date scheduled for the Regular run of this payroll each period.
The Cut Off date, included for your reference, is the final date for entering or changing payroll information before a run.
A payslip offset, reckoned from the completion date for your payroll processes is always a positive number to enable you to prevent employees from viewing payslips before the official payment date. For example, if the payroll processes complete on 15th May, and employees do not receive payment until 20th May, you can enter an offset of 5 to align the payslip date to the payment date.
Note: Australia, China, Hong Kong, India, Japan, Korea, Singapore, and New Zealand users: You can set the payslip offset to determine when employees can view their payslip information.
These offsets are the defaults for the calendar. You can manually make date changes in the calendar (such as when an offset date falls on a weekend or holiday, by choosing Period Dates).
Select a default payment method for employees who have no valid personal payment method. You cannot select a method using magnetic tape because this requires information about employees' bank accounts.
Select a default consolidation set for this payroll. One consolidation set is created automatically when you define your Business Group. Oracle Payroll users can create other consolidation sets for payroll processing.
In the Costing region, you can enter information about the ledger and suspense account holding costing information for this payroll.
The information you enter here depends on the setup of your Cost Allocation key flexfield.
See: Setup of the Cost Allocation Key Flexfield, Oracle HRMS Enterprise and Workforce Management Guide
Check the Negative Payment Allowed check box if you want the PrePayments process to include negative payments. If you leave the box unchecked, the PrePayments process ignores negative payments.
Check the Multiple Assignment check box if you want an employee to receive a single payment, for multiple assignments carried out within your organization. However, if a PrePayments process, which runs prior to your effective processing date, already exists you cannot go back and change the Multiple Assignment check box. This box is only visible if the functionality is enabled for your localization.
Note: If you check the Multiple Assignment check box, make sure it remains checked throughout your payroll processing. Oracle Payroll reports in error if some of your payroll processes support multiple assignment processing and others do not.
If you are an Oracle Payroll user, enter the Statutory Information field to open the Statutory Information window.
Your Oracle localization team may have created fields in this window.
Note: The Statutory Information field is not visible if your HR:User Type profile option is set to HR User.
If the Payslip Modeler is enabled for your localization, then you can set locking period for payslip modeling. This restricts users from making updates to payroll information while modeling their payslip during a mock payroll run during the specified period.
Specify the number of days prior to and after a specified date when can you make changes for modeling the payslips.
You can specify the Availability Rules whether to disable the functionality days after the period start and days prior to the End date or enable the functionality between the days from start and before the period end date.
Note: You cannot make any changes beyond the days specified here for payslip modeling.
For Korea users only: Click in the Further Payroll Information field and specify the exemption amounts.
By default, the application uses the TRUNC function for tax calculations. Specify Yes if you want the application to use ROUND function instead of TRUNC function for tax calculations.
Specify if you want to adjust the amounts for standard tax breaks.
Specify if you want to enable reprioritization of pension related amounts as the last priority within the calculation category.
For Japan users only:
Click in the Further Payroll Information field and specify the following information
income tax dependent reference type
social insurance premium collection type
user defined year end adjustment formula
Hi Wp Monthly Remuneration Synchronous
Geppen Santei Process Date (MMDD)
Print Personal Number
Save your work.
Choose the Period Dates button to view the calendar generated for your payroll. In the Period Dates window:
You can view the default offset dates for every period, and you can manually override any of these dates in any record.
You can change the payroll's default Open status in any period to Closed to prevent further element entries. You can also reopen the period if necessary.
Important: Use this 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. You cannot change any element entries that span a closed payroll period, and so you may be prevented from performing these tasks.
Choose the Valid Payment Methods button to add valid payment methods for this payroll.
In the Valid Payment Methods window, the default payment method for the payroll appears automatically. You can add other methods. First set your effective date to the date you want the method to become valid.
Note: An employee assigned to this payroll can have any number of personal payment methods chosen from those you enter here for the payroll.
See: Entering Payment Methods for an Employee Assignment in Oracle HRMS Workforce, Sourcing, Deployment, and Talent Management Guide
Use the Organizational Payment Method window to define payment methods for your enterprise.
From this window, you:
Supply the name and starting date of your payment method.
Enter the details of the source bank account from which your enterprise makes the payment.
Specify the General Ledger (GL) accounts that hold reconciliation and error details for the payment method.
Handle costing for the payment method. For example, you can specify whether to transfer the costs to GL and whether costing applies to cleared payments only, uncleared payments only, or a combination of cleared and uncleared payments.
Confirm that your source bank account in Oracle Payroll is the same bank account that Oracle Cash Management uses to clear your payments. This confirmation assures you that you are operating with a single consistent bank account rather than with duplicate accounts that introduce accounting errors.
To define a payment method
Supply a name and start date for your payment method
Set your effective date so that it reflects the date when you want to begin using this payment method.
Enter a name for the payment method, and select the payment method type.
For a third-party payment method, always select the type Check/Cheque. The default currency for your business group appears automatically.
If an alternative currency exists for your payment method, select it.
If your payment method controls payments to a third party such as a benefits carrier or garnishment receiver, check the Third Party Payment box.
Enter the source bank details for your payment method
Navigate to the Source Bank tab. The Country for your source bank account appears automatically.
Enter the Bank Details field to open the Bank Details window. Enter information about the account from which your enterprise intends to make payments.
If you are using Cash Management, include the following information:
Account Name
Account Type
Account Number
Bank Name: If this already exists, enter the name exactly as it appears in Accounts Payable.
Bank Branch: If this already exists, enter the name exactly as it appears in Accounts Payable.
Italy Users: You can enter the Bank Name, Bank Location, Account Number, and Account Name. The IBAN Account displays by default.
Ensure that you enter any additional bank details that are specific to your enterprise. For example, bank details for U.S. payment methods always require a transit code. The transit code, or transit routing number is the nine-digit number that identifies the financial institution. If the transit code is incorrect, the funds will not be posted to the account.
South Africa Users: Enter the account holder's name and indicate whether the account holder relationship is joint, own, or third party.
Belgium, Denmark, Finland, France, Germany, Hungary, Ireland, the Netherlands, Norway, Poland, Russia, Spain, and Sweden users: Enter the Bank Identifier Code (BIC) and International Bank Account Number (IBAN) in the Bank Identifier Code and the IBAN Number fields, respectively. Note that you must enter at least one of the account numbers, that is, either the International Bank Account Number (IBAN) or the Account Number. If you enter the Account Number, then the Bank Code and Branch Code fields are mandatory.
Warning: Always review the account setup for Oracle Accounts Payable before you define the account in Oracle Payroll. The details for your Payroll account must exactly match the account details in Accounts Payable. Otherwise, Accounts Payable creates an extra account with marginally different details. This duplicate account introduces errors when you reconcile payments between Payroll and Accounts Payable.
Specify what type of payments to cost for this payment method
Navigate to the Costing tab. Each check box indicates a particular type of payment. Check the boxes for each type of payment that you want to cost. When you subsequently run the Costing of Payment process, it costs each type of payment as you have indicated. The entries that you make for an individual check box can imply automatic checking of related boxes. Your choices are:
Cost Payment: Check this box to specify that you want to cost only uncleared payments for this payment method.
Cost Cleared Payment: Check this box to specify that you want to cost only cleared payments for this payment method. If you check this box, the Cost Payment box is also checked by default.
Cost Cleared Voided Payment only: Check this box to specify that you want to cost any voided payments that have also been cleared by Oracle Cash Management. If you check this box, the Cost Payment and Cost Cleared Payment boxes are also checked by default.
Exclude External/Manual Payment: Check this box to exclude any external/manual payments from costing. This exclusion is useful if you are using this payment method as a dummy payment method to cancel a previous payment, or if you are making a payment by cash. If you check this box, the Cost Payment box is also checked by default.
Transfer to GL: Check this box to specify that costed payments should transfer to General Ledger. If you check this box, the Cost Payment box is also checked by default.
Specify the GL accounts for this payment method
Navigate to the General Ledger tab.
Select Ledger to indicate the ledger to use if you intend to reconcile payments using Oracle Cash Management.
Select the GL Control Account.
Select GL Cash Account to indicate which cash account to use for the reconciliation of payments.
The entry for Description appears automatically by default, depending on what you enter in the GL Cash Account details.
Select the Cash Clearing Account.
Select the Error Account.
When you first specify the GL accounts for a bank account, these then become the default GL accounts for any other payment methods that use the same bank account. The defaults apply for all new payment methods using the bank account. They also apply retrospectively for any existing payment methods that were already using the same account. However, you can override these defaults by entering your preferred GL accounts on the General Ledger tab.
At this point, check that your Payroll setup and Cash Management setup are fully integrated.
Confirm that you can reconcile payments in Cash Management
Navigate to the Cash Management tab. You cannot change the information on this tab, but you can confirm that your GL accounts are correct.
To confirm that Oracle Cash Management is operating with the same source bank account that you are using in Oracle Payroll, view the check box. If the box is checked, then Oracle Cash Management holds the bank account for this payment method, and you can reconcile payments knowing that you are using an identical account in Payroll, and in Cash Management.
However, if the box is not checked, this indicates that Oracle Cash Management does not hold the details for your Payroll account. This may indicate that duplicate accounts exist and you should exercise caution when you reconcile your payments.
Enter further information for the payment method
Enter further information to determine how to process this payment method. Click in the Further Information field to see the range of further information for your enterprise. For Japan users only: Enter the company code and company name. Select the delimiter type for the Direct Deposit file.
For Norway users only: Enter values for the following fields to define the payment method level. (The same payment type supports the ISO20022 and older Telepay process).
| Field | Description |
|---|---|
| Initiating Party Name | Enter the name of the known party. |
| Sender ID | Enter the initiating party ID. This unique organization identification is assigned by an institution using an identification scheme. Typically, this is the customer-ID in the debtor bank based on the Brønnøysundregistrene and their Central Coordinating Register of Legal Entities, or other identification arranged with the bank. |
| Scheme Name | Enter the code for the identification scheme as published in an external list. The options are BANK and CUST:
|
| Batch Booking | Indicate whether [the requestor] has requested a single entry per individual transaction or a batch entry for the sum of the amounts of all transactions within the group of a message. The options are:
Note: The Yes and No values are reflected in XML as true and false. |
| Service Level Code | The service level code specifies a pre-agreed upon service or level of service between the parties as published in an external service level code list. Select one of the following options:
|
| Payment File Format | This field indicates which supported payment file format and process are in use. The supported processes are Telepay and ISO 20022.
|
| Payment Identification ID | The payment identification ID is a reference assigned by a sending party to identify the payment information block within a message. |
| Payment Method | Select one of the following values to specify the payment type to use for transferring the funds:
|
| Debtor Name | Enter the name of the debtor party. |
| Debtor ID | The debtor ID is a unique identifier assigned to a debtor organization by an institution using an identification scheme. |
Enter the company information and Delimiter type in Organization Payment Methods window.
See: Defining a Payment Method
Run a payroll run (Salary, Bonus, Special Bonus or Retirement Money)
See: Running the Payroll Run (Salary) Process
Running the Payroll Run (Bonus) Process
Run the pre-payments.
See: Running the Pre-Payments Process, Oracle HRMS Payroll Processing Management Guide
Run the Pre-Process to Generate Direct Deposit File process.
See: Running the Pre-Process to Generate Direct Deposit File
Run Generate Direct Deposit File process.