Managing Gross Salary Changes in the Current Year

The logic used to manage gross salary changes depends on the organization collecting the contributions:

  • For URSSAF, ASSEDIC, and CSG/CRDS, the system performs a partial recalculation of the gross salary elements.

  • For other contributions such as ARRCO and tax levies, Global Payroll for France performs a full recalculation of the gross salary elements.

This section provides an overview of both of these approaches.

Note:

The explanations provided here deal specifically with recalculations in the current year using the corrective rules delivered by PeopleSoft. PeopleSoft does not deliver specific rules for processing retroactive changes in prior years.

Partial Recalculation

Some organizations such as URSSAF and ASSEDIC require that gross salary elements be submitted to the contribution rates in effect on the payment date. For example, if a payee receives a retroactive pay increase, the contribution rates of the current period should be applied to the gross salary deltas, rather than those in effect in the recalculated period (as the pay increase is only realized in the current period).

Global Payroll for France manages gross salary changes for URSSAF, ASSEDIC, and CSG/CRDS by:

  • Recalculating the gross salary, taking into account the elements modified retroactively.

  • Storing the recalculated gross in accumulators.

  • Retrieving the old value of the gross rather than the recalculated gross to determine contributions in a prior period.

    Note:

    The system recalculates the gross, taking into account the retroactive changes in salary. However, when calculating the funding base for URSSAF and ASSEDIC, the system does not use the recalculated gross but the "old value" of this gross.

  • Recalculating funding bases, based on the old gross value, using standard rules.

  • Using the annual regularization of contributions principle to process the recalculated gross deltas in the current period. Based on this principle, the system compares, in the current period, the gross salary effectively used (submitted gross) to calculate the funding bases, and the recalculated gross salary (real gross).

    • If no retro calculation is triggered or if the gross salary hasn't changed retroactively, the submitted gross and the real gross are equal, and there are no gross deltas to process.

    • If a retro calculation occurs with a change in the gross salary, the submitted gross and the real gross are different. This difference (positive or negative) corresponds to the gross delta and is added to the gross calculated for the current period, where it is submitted to current contribution rates.

Note:

The process described here is referred to as a partial recalculation because the gross salary used is the "old" or "previously calculated" gross.

Note:

If a contribution rate changes retroactively but there is no change to the gross salary (no gross salary delta), the new rate is applied to the old value of the funding base. This is in keeping with the rule that the contribution rate to apply is the one in effect on the payment date.

Full Recalculation

For other contributions such as ARRCO, AGIRC, contingency funds, and tax levies, Global Payroll for France performs a full recalculation of the gross salary. In other words, the system does not retrieve the old gross values, but fully recalculates both the gross salary and the funding bases, and replaces the original calculations with the new ones (in keeping with the logic of the corrective retro method).

In addition, Global Payroll for France uses the full recalculation method whenever a retro mismatch situation occurs, regardless of the social organization. The reason for this is that mismatches produce reversal segments that completely cancel the initial calculations. This prevents the old value of the gross salary elements from being retrieved during retroactive processing.

Note:

As a general rule, the full recalculation method is used to process gross salary changes for social organizations with rates that are fixed for the year. The partial recalculation method is used to process changes for social organizations with rates that occasionally vary during the year.

WARNING:

If the system fully recalculates the gross salary and funding bases in a situation in which rates also change between the recalculated and the current period, the gross retro deltas may be submitted to the old rate instead of the current rate. If this occurs, it is possible to manually enter, for a specific earning, the gross delta using positive input in the current period. However, you should consider the possible consequences of this solution, as it may prevent salary history from being correctly recorded in the system.

See PeopleSoft Global Payroll: Understanding Complex Retro Processing.