Understanding Absence Elements

This topic discusses:

  • Absence rules for Global Payroll for China.

  • Delivered absence entitlements and takes.

  • Delivered element group and group members.

  • Delivered absence earnings.

  • Process lists and sections.

  • Viewing delivered elements.

This topic defines the customary absence rules for leaves and terminations that are used with Global Payroll for China. These rules can vary. The list is a simplification of the rules:

  • The accrual year most commonly used is the 1st of January to the 31st of December, but you can also use a fiscal year (for example, the 1st of April to the 31st March, or the 1st of July to the 30th of June).

  • Leave entitlement is based on employee status (for example, probation or confirmed), service period, and salary grade.

  • The system allows adjustments to accrued leave (for example, due to forfeiture).

Note: Global Payroll for China uses standard leave types delivered by PeopleSoft. They are not specific to China. Global Payroll for China also uses standard PeopleSoft-delivered absence elements to demonstrate how you can set up leave for China. We have not created any absence elements that are China-specific.

This table lists the leave types that the system allows the tracking of.

Leave Type

Description or Rule

Annual

This entitlement is usually paid in days. Two types exist:

  • Accrued (the employee accrues his or her entitlement over time).

  • Grant (the company gives the employee a specific number of days at the end of the year or the beginning of the year).

You can bring the balance from a previous year forward to the current year. You can also create leave entitlements that are prorated for the year.

Leave is usually paid upon termination. The company can buy back leave or the employee can forfeit the leave.

Unpaid

No specific rule.

PeopleSoft delivers the VAC ENT (vacation entitlement) entitlement and VAC TAKE (vacation take) for absences. You can use these elements as delivered, modify them, or create new elements.

Vacation

For the delivered VACATION entitlement, the calculation depends on the service seniority of the payee. This means the years of service from the hire date to the period end date. The entitlement is granted through a bracket and it represents the number of days per year:

This table lists the delivered VACATION entitlement values based on years of service.

Years of Service

Days Per Month

Days Per Year

1 to 4

1.67

20

5 to 9

1.83

22

10 +

2.08

25

Note: When a payee has a mid-month hire date and that payee's years of service warrants a change in entitlement, the system uses the new monthly entitlement for the pay period in which the required years of service was achieved. For example, a payee hired on October 12, 2002 would receive 1.83 days for the October 2007 payroll run because the payee achieved five years of service in the middle of the pay period.

Note: If the entitlement is 20 days per year and payroll is calculated on a monthly basis, the formula is 20÷12 = 1.67 days. At the end of the year the sum is equal to 20.04 (1.67*12 = 20.04). This means that a rounding rule issue exists.

To resolve the rounding rule issue, the calculation is accomplished using a bracket with 12 rows, where each row represents a period.

This table lists the 12 rows (or periods) that are in the bracket that is used to resolve rounding rule issues.

Period

Entitlement

Balance at the End of Each Period

1

1.67

1.67

2

1.67

3.34

3

1.66

5

4

1.67

6.67

5

1.67

8.34

6

1.66

10

7

1.67

11.67

8

1.67

13.34

9

1.66

15

10

1.67

16.67

11

1.67

18.34

12

1.66

20

Total

20

Because the entitlement is based on service seniority, the primary key is service seniority. A second key is used for the period number, which is based on the service date. The system also takes these items into consideration:

  • The entitlement is prorated based on calendar days.

  • Accumulators are generated for entitlement, balance, adjustment, and take (accumulator period is yearly based on hire day divided by hire month).

  • At the end of the year the balance is forwarded to the next year.

  • The payee is eligible to take vacation only a year after the payee is entitled.

When the balance is equal to zero, the system then uses the vacation entitlement. The system also uses a day formula to check whether the leave day is a working day (schedule hours) or a public holiday. It allows partial leave days and converts the partial hours that are entered to a fraction of a day (for example, 4 hours = .5 day).

Paid leave is associated with the VACATION PD earning code. Unpaid leave is associated with the VACATION UNP earning code. The rate associated with the vacation earnings is a formula that calculates the daily rate based on the system element MONTHLY RT ÷ 20.92 days per month. In the Global Payroll Rule, the vacation earning amount is a member of an accumulator that is then used to reduce the salary earning amount. For China, the same principal applies, except that the vacation earnings (VACATION PD) reduces the salary.

To invoke the vacation (VAC) entitlements, PeopleSoft delivers the CN EG LEAVE leave entitlement and take for Global Payroll for China. This element includes the element group members listed in this table:

Element Type

Element Name

Description

Eligibility Assignment

Absence Entitlement

VAC ENT

Vacation # of days

By Eligibility Group

Absence Take

VAC

Vacation Leave

By Eligibility Group

PeopleSoft delivers earnings elements for absences and vacations. You can use these elements as delivered, modify them, or create new elements.

This table summarizes the absence earnings for Global Payroll for China:

Name

Unit or Amount Type

Rate

Accumulators

VACATION PD (paid vacation)

Payee-level

GP FM DAY RATE (system element)

CHN GROSS

TAXABLE NORMAL SAL

CN AC ROLLAVG SAL

VACATION UNP (unpaid vacation )

Payee-level

GP FM DAY RATE (system element)

NA

Note: NA indicates a value of not applicable.

All of the delivered absence-related earnings have a calculation rule of Unit × Rate. All absence earnings subtract from the SALARY earnings to maintain the same pay rate for salaried payees. They do not, however, subtract from the REGULAR earnings because earnings for hourly payees are based on the actual number of hours they worked during the period. For example, if a payee was absent for 8 hours during a 40-hour work week, the entered work hours would be 32.

The system processes the delivered earnings elements each time you run a payroll. You can change the processing schedule as needed.

Global Payroll for China delivers the CN SE LEAVE absence-related process section. The CN SE LEAVE section is a member of the CN PR ABSENCE process list and contains the following elements:

  • VAC DT SVC EXT (date)

  • VAC DT ELIGIBTY (date)

  • VAC ENT (absence entitlement)

  • VAC (absence take)

The PeopleSoft system delivers a query that you can run to view the names of all delivered elements designed for Global Payroll for China.

See Understanding How to View Delivered Elements