Setup Tasks for Implementing Payroll Core

To implement the Payroll Core application, sign-in as a user with Application Implementation Consultant or Payroll Implementor role and opt into the offerings applicable to your business requirements.

Refer to the Functional Setup Manager guide to manage the opt-in and setup of your offerings.

Before you begin implementing Payroll Core, you must complete:

Initial application setup.

Implementation of Global Human Resources and HR setup tasks for implementing and processing payroll. For more information, refer to the Implementing Global Human Resources.

The Payroll Core application is best suited for countries that do not have complex local taxes and social insurance calculations and hence has no requirement for setting up calculation components and calculation cards. The application uses elements and formulas to calculate employee wages and compensation and aggregate balance accruals.

Before you begin, refer to the ‘Setup Tasks for Implementing Global Payroll’ topic in the Implementing Global Payroll guide. The following sections explain the points that you must consider and are specific to the Payroll Core application.

To implement Payroll Core you will need to perform most of these tasks from the Setup and Maintenance work area. Use My Enterprise on the Home page to navigate to Setup and Maintenance.

Prerequisite Tasks for Payroll Core Setup

Before you set up the payroll components ensure that you have completed these tasks.

Create an Implementation Project
Setup tasks for organization structures are defined in an implementation project. Create an implementation project and select the Workforce Deployment offering to generate the setup tasks required to set up the Payroll Core application.
Create Country
Use the Manage Territories task and search for your territory on the Manage Territories page. If you find your territory, you can edit the description to match your requirements. Don't edit territory names or codes. Use the territory code and name to verify geographies, create legal addresses, and select the country extension.
If you are unable to find your country in the predefined territories list in the application, create the country.
Select Default Currency
On the Manage Territories page, select the default currency for the country. This is the currency in which balances are accumulated for this legislation.
Verify Geographies
Use the territory code to verify predefined geographies and load any additionally required local geographies.
Define Enterprise Structures for HCM
The Enterprise classification represents the top most structure in the organization. A person exists within the context of an enterprise. An enterprise doesn’t adhere to any legislation. Country specific attributes are stored at the level of a Legal Entity.
1. Define a legislative data groups (LDGs) for your country and associate it with one or more payroll statutory units (PSUs). Each PSU can belong to only one LDG. An LDG is used to partition your payroll and related data. Payroll-related info, such as elements, is organized by LDG.
2. Create legal addresses for all organizational units of the enterprise before you create legal entities. A legal address is the address of record for an entity.
3. Define a legal entity that is both a legal employer and a PSU. Define Legal Entity HCM information as required.

Payroll Setup Tasks

Select Country Extensions and Address Validation Rules
Since you are processing payroll and paying your employees, select Payroll as your country extension. Select the address style and address validation for your country. The address style you select determines which address attributes are available and maintained in the application. The combination of address style and address validation determines the level of validation.
Define Payroll Legislations
1. Use the Configure Legislations for Human Resources task to define legislative rules. Legislative rules govern default values and determine how you manage employee records in your organization. Base your selections for the following attributes on the statutory requirements of your country.
  - Payroll relationship rule for your country determines how employment records are created when employees are hired or rehired.
  - If you plan to capture information for payroll payment purposes, map a person type to a payroll relationship type. Select appropriate values for your country.
2. Use the Configure Payroll Legislations task to define payroll-related data, such as legislative rules, element classifications, payment types, component groups, balance dimensions, and other related objects.
Define Elements
Elements are the building blocks of payroll and benefits. You can define elements using the element template. Define elements to calculate specific earnings, deductions, and other payroll data for reporting, compensation, absences, and benefits calculations.
Define Balances
Payroll balances show the accumulation of values over a period of time. The values can be currency, hours, or any other numeric value. Balances are created automatically when creating elements. You can edit the definition of these generated balances, or create additional balances for calculations or reporting.
The value assigned to a balance during processing is determined by balance feeds defined for the balance. Balance feeds can be by element input values or by balance classification run results. When you create a new balance, it must be associated with a category and categories cannot be added or modified.
Define Formulas
The Elements task generates standard element skip and calculation formulas. Use the Fast Formulas task to modify the formulas to suit your requirements. Refer to ‘Overview of Using Fast Formulas’ for more information on formula types and how you can use them to control processing and validate element entry values.
Define Payroll Definitions
When you create a payroll definition, the application generates the complete payroll schedule based on the payroll period type, the offsets or calendar adjustments, and the number of years that you specify. Each payroll in the schedule is assigned a unique name. Assign employees to a payroll definition on the Payroll Relationships page.
Define Payment Methods and Payment Types
Create at least one Organization Payment Method (OPM) for each combination of LDG, payment type, and currency that you use to disburse wages and other compensation. When you create an OPM, select a payment type and define at least one payment source for each OPM.

Prerequisite Tasks for Payroll Core Setup

Payroll Setup Tasks

Other Document References