Frequency with Element Definitions
An element is the smallest component of PeopleSoft Global Payroll, and it is used in defining calculation rules to process your payroll. Elements can hold the values of pay (earnings), an amount to be deducted from pay (deduction), or time away from work (absence).
Elements (such as earnings, deduction, and absence) can be standalone. Supporting elements (such as rate codes or rounding rules) can be used with other elements to define a calculation rule. Each element is defined only once, but it can be used repeatedly.
For any earnings, deduction, or absence element, you must specify the frequency of the stated amount on the Earning/Deduction definition. For each item that you associate with a frequency, you must consider how the frequency fits into the overall processing picture. Selecting the correct frequency for earnings, deductions, and absence elements is essential for correct processing. For example:
| Term | Definition |
|---|---|
|
Earnings element |
In what frequency is the stated amount paid? Is it per week, per month, or per year? |
|
Deduction element |
In what frequency is the stated amount withheld? Is the stated amount the amount to withhold each pay period, each month, or for the entire year? |
|
Absence element |
Is an employee entitled to three days of holiday time per month or per year? |
In PeopleSoft Global Payroll, you use frequency to define earnings, deduction, or absence elements.
To illustrate, we refer to defining an earnings element. However, the process is the same for earnings, deduction, and absence elements.
You define the calculation rule, frequency, and generation control for an earnings element on the Earnings - Calculation page (GP_ERN_DED_CALC).
See PeopleSoft Global Payroll: Earnings - Calculation Page.
Select a calculation rule and once you select a calculation rule, you must further define details for each component of the rule. For example, if you select Amount, specify the amount of the earnings element.
The following table lists the calculation rules and the components of the calculation rule for which frequency conversion is performed:
| Calculation Rule | Component |
|---|---|
|
Amount |
Amount (if necessary) |
|
Rate × Unit |
Unit |
|
Rate × Unit × Percentage |
Unit |
|
Base × Percentage |
Base |
Define the frequency that the stated amount represents. If you select Use Calendar Frequency, the system uses the frequency that's defined for the calendar period on the Define Calendars - Period page (GP_CALENDAR_PERIOD). If you select Use Specified Frequency, you can define your frequency directly on the Earnings - Calculation page by selecting from a list of frequencies.
See PeopleSoft Global Payroll: Creating Periods.
The Frequency field enables you to tell the system the frequency with which you are stating a value. For example, let's say that you select Use Specified Frequency, that you have a weekly payroll, and you create an earnings element with an amount of 100 and a frequency of Monthly. If you don't have any generation control conditions defined, the system annualizes and de-annualizes the amount into a processing frequency amount. Let's assume that you define your organization's monthly frequency as 12 and the weekly frequency as 52. The system takes the 100 (monthly amount) and annualizes it to 1200. Next, it takes this annualized amount and de-annualizes it into the payroll processing frequency (weekly, in this example). The amount paid each pay period is:
1200 / 52 = 23.08
The benefit of defining a frequency is that if your organization has multiple pay frequencies (such as weekly, semimonthly, and monthly), you don't have to create separate earnings for each frequency. The system automatically converts the amount into the corresponding pay period amount. Let's say that your organization decides to give an annual bonus of 1000 to all payees and this bonus is distributed throughout the year. Your hourly payees get paid weekly and your salaried payees get paid monthly. If you define an earnings bonus as BON = 1000, with a frequency of Annual, you can apply this earnings definition to payees who are paid weekly and payees who are paid monthly by using annualization and de-annualization. The frequency assigned on the Earnings Calculation page calculates the bonus amount correctly, regardless of the pay frequency.
Note:
In PeopleSoft Global Payroll, there is no distinction between organizational relationships (employee, contingent worker, or person of interest). Because payroll is processed for all types of people with jobs, the PeopleSoft Global Payroll documentation refers to both of them as payees.