Calculating Rolling Average Earnings
You can set up an earnings element in which the rate is determined by the average rate of an earnings elements or set of earnings elements over a rolling period (such as the preceding 12 months).
The ANNRA (annual leave rolling average) earnings element is set up this way. Its calculation rule is Unit × Rate, where:
Unit = Payee level
Rate = Formula ERN FM ROLL AVG
In a rolling average calculation based on, for example, retrieving the average rate over 12 months for a monthly pay group, the formula retrieves the value 12 from variable ERN VR ROLL UNIT—set as a pay group supporting element override—and the value months from AUS VR FREQ TYPE retrieved from the array AUS AR FREQUENCY.
You can calculate rolling averages for monthly, fortnightly, and weekly pay groups. The following example is based on months:
Example
The ANNRA earnings element must be paid in December 2002 for a monthly pay group, and the rate is the average rate of a group of earnings elements over the preceding 12 months. The group of earnings consists of the members of the two life-to-date accumulators ERN AC ROLLAVG AMT and ERN AC ROLLAVG HRS. The earnings rate formula:
Uses historical rule ERN HR R/A END to retrieve the amount and hours balances of accumulators ERN AC ROLLAVG AMT and ERN AC ROLLAVG HRS, respectively, at the end of the preceding month (November).
Call these balances the end amount (EA) and end hours (EH).
Uses the historical rule ERN HR R/A START to obtain the amount and hours balances of the same accumulators 12 months earlier, at the end of December 2001 (the start date).
Call these balances the start amount (SA) and start hours (SH).
Calculates the amount difference (AD) and hours difference (HD) over the rolling average period, as follows:
EA − SA = AD
EH − SH = HD
Completes the calculation, as follows:
AD ÷ HD = ANNRA rate for December 2002
When calculating rolling averages for fortnightly or weekly pay groups, the formula obtains the accumulator balances at 14 or 7 days, respectively, prior to the period end date of the December 2002 ANNRA pay run (EA and EH).
It then uses the ERN VR ROLL UNIT value to calculate the start date so that it can retrieve the amount and hours balances at that date (SA and SH), and it completes the calculation.
To set up rolling average earnings calculations:
Populate the amounts and hours accumulators with the respective earnings or automatically assigned units on which the rolling average calculation is based.
Assign the ANNRA earnings element to an employee as positive input, and enter the unit's value.
The unit's value is the number of ANNRA hours that you want paid at its calculated rate.
By supporting element override at the pay group level, set the variable ERN VR ROLL UNIT to the number of months, fortnights, or weeks that the system must evaluate to retrieve period amount and hours data for use in the calculation.