Understanding Social Insurance Rules

Monthly Remuneration

The system is delivered with rules and elements that support monthly remuneration calculations. Some of the highlights are:

• Accumulators track cash and non-cash earnings that are subject to the social insurance premium and monthly fluctuation in the fixed wage portion of salary.

• Variables, formulas, and accumulators track and evaluate the base days for payment in each month for each pay type.

• Formulas calculate average monthly remuneration for appraisal months during which the employee worked sufficient base days.

Monthly Standard Remuneration and Grades

PeopleSoft delivers and maintains the Monthly Standard Remuneration table. View the values and grades in this table on the Rvw SI Std Remun Grades JPN (review social insurance standard remuneration grades) page.

Eligibility for Regular Decision or Occasional Revision

The system uses four subject indicators to track eligibility for occasional revision or regular decision during a salary pay run:

The system uses these subject indicators to determine which calculations to perform and which employees to select for reports.

Retroactive Increase or Decrease in Fixed Wages

When an employee has a retroactive increase or decrease in fixed wages, the system calculates the adjusted average monthly remuneration during the appraisal period if enough base days are in the month of retroactive payment. Eligibility for occasional revision is determined based on the adjusted average monthly remuneration.

Premium Calculations from Salary

The social insurance premiums for monthly salaries are calculated based on the monthly standard remuneration as of the end of the month, then deducted from the salaries that are paid in the following month.

The social insurance premiums that are deducted from salaries are calculated based on the values of the following data as of the end date of the month previous to the month in which payment is made:

• Employee's monthly standard remuneration.

• Standard Remuneration Grade table.

• Premium rates that are set up for the establishment on the SI Premium Rates page.

• The employee's social insurance data that is entered on the Maintain Social Ins Data JPN page.

This means that for premiums deducted in May, the system uses values with an effective date as of April 30 of the same year. Make sure that the data that is effective at the end of a month is the data that you want to use for calculating premiums that are deducted in the following month.

Premium Calculations from Bonus

The social insurance premiums that are deducted from bonuses are calculated based on the values of premium rates that are set up for the establishment on the SI Premium Rates page with the effective date as of the end of the month when the bonus is paid. The standard bonus remuneration that is used for the calculation is the actual gross bonus amount truncated to the nearest thousand yen. The standard bonus remuneration is subject to caps for health insurance and employees pension insurance.

Premium Deductions for Enrollments and Terminations

The system checks the employee's social insurance data to determine whether an enrollment or termination change reason exists in the month of payment or the previous month. If an enrollment or termination change reason exists, the system calculates the appropriate deduction from salaries.

Note that the social insurance termination data must be entered before the payee's last payments are processed.

For example, an employee's last day is May 10 and the pay period of her last payment is from April 16 through May 15. The payroll is processed on May 20. In this example, before her last payment is processed on May 20, you must enter her social insurance termination data with an effective date of May 11.

Employer Contributions

The system includes the payer social insurance flag variable (SC VR CALC ER FLG), which indicates if the employer contributions are calculated. If this flag is selected, the system calculates the following premiums for employers and employees:

• Health insurance.

  The system calculates the employer contribution of health insurance as variable SC VR HEL CO and saves the data in the writable array GPJP WA SCRPT.

• Nursing care insurance.

  The system calculates the employer contribution of nursing case insurance as variable SC VR NUR CO and saves the data in the writable array GPJP WA SCRPT.

• Pension insurance.

  The system calculates the employer contribution of pension insurance as variable SC VR PEN CO and saves the data in the writable array GPJP WA SCRPT.

• Pension fund.

  The system calculates the employer contribution of pension fund as variable SC VR FND CO and saves the data in the writable array GPJP WA SCRPT.

You can set contribution rates for health, nursing care, pension, and pension fund insurance premiums on the SI Premium Rates page.

See SI Premium Rates JPN Page.

In addition, the system calculates the contribution for child benefit. This contribution is based on the total pension remuneration and is calculated as part of the Social Insurance Check report.