Proration Examples with Nondelivered Frequency

The previous examples employed PeopleSoft-delivered frequencies, which are based on a standard 40-hour, 5-day workweek. The examples in this topic illustrate how the system applies salaried and hourly proration rules for mid-period pay rate changes when the daily frequency is defined for a 40-hour, 3-day workweek.

In the example of a 40-hour, 3-day week, the annual number of workdays is 3 × 52 = 156. On the Frequency table, a nonstandard daily frequency must be defined with the annualization factor of 156. This frequency must be assigned on the Pay Group table.

The Hours per Day is derived by taking the employee's standard hours in Job data times the annualization factor of the work period in Job data divided by the annualization factor of the daily frequency on the Pay Group table. In the example of a 40 hour, 3-day week, the Hours per Day calculation is 40 × 52 / 156 = 13.333.

Example Scenario

This table lists the relevant data in the employees' Job data:

Employee	Employee Type	Compensation Rate	Compensation Frequency	Standard Hours	Work Period
Marie	Salaried	Before: 1000 USD After: 1100 USD	Semimonthly (annualization factor 24)	40	Week (annualization factor 52)
John	Hourly	Before: 10.00 USD After 11.00 USD	Hourly (annualization factor 2080)	40	Week (annualization factor 52)

This table lists the relevant data on the Pay Group table:

Pay Frequency	Daily Frequency	Monthly Frequency	Work Schedule
S: Semimonthly (annualization factor 24)	D156: (annualization factor 156)	M: Monthly (annualization factor 12)	NNNNYYY

The examples involve one semi-monthly pay period of July 1 through July 15 as represented in this calendar:

S	M	T	W	T	F	S
	1	2	3	4	5	6
7	8	9	10	11	12	13
14	15

As defined by the work schedule on the Pay Group table, there are 11 workdays in the period July 1–15. On Monday July 8, all employees received a 10 percent pay increase. The respective pay rates are indicated as before and after in the compensation data listed in the activity scenario data. The following examples illustrate how Marie and John's pay would be prorated.

Note:

The following examples assume that the employee's Earnings Distribution Type on the Job Earnings Distribution page is None.

Note:

The following examples use the formulas and variable definitions provided earlier in the topic.

See Proration Rules.

Salaried – Percent of Annual

Work Days x Annual Pay Rate / Work Days per Year

3 Work Days × 24,000 USD / 156 = 461.54 USD

3 Work Days × 26,400 USD / 156 = 507.69 USD

Total Pay = 969.23 USD

Note:

Work Days per Year cannot be calculated using custom frequencies.

Salaried – Rate per Work Day

Work Days × Hours Per Day x Hourly Rate

3 Work Days × 13.333 Hours per Day × 11.538462 USD per hour = 461.53 USD

3 Work Days × 13.333 Hours per Day × 12.692308 USD per hour = 507.68 USD

Total Pay = 969.21 USD

Salaried – Percent of Period

Work Days × Pay Period Compensation Amount / Total Work Days in Pay Period

3 Work Days × 1,000 USD / 6 Total Work Days = 500.00 USD

3 Work Days × 1,100 USD / 6 Total Work Days = 550.00 USD

Total Pay = 1,050.00 USD

Hourly – Work Days

Work Days × Hours Per Day × Effective-Dated Hourly Rate

3 Work Days × 13.3333 Hours per Day = 39.99 (rounded to 40) × 10 USD per hour = 400 USD

3 Work Days × 13.3333 Hours per Day = 39.99 (rounded to 40) × 11 USD per hour = 440 USD

Total Pay = 880 USD

Hourly – Percent of Period

Work Days × Hours in Period × Effective-Dated Hourly Rate / Total Work Days in Pay Period

3 Work Days × 86.67 Hours / 6 workdays in the period = 43.335 (rounded to 43.34) x 10 USD = 433.40 USD

3 Work Days × 86.67 Hours / 6 workdays in the period = 43.335 (rounded to 43.34) x 11 USD = 476.74 USD

Total Pay = 910.14 USD