Options for Creating Payroll Earnings Elements

Use the element template to create and configure earnings elements and their associated objects. The template prompts you for information that's used to create the necessary payroll objects.

You can also edit the objects created by the element template. You first create an element and then update it so that it's available for all payrolls.

Use the Elements task in the Compensation section of My Client Groups to create elements.

Primary classifications control processing, the priority in which elements are processed, and the balances they feed. They are designed to meet legislative requirements and you can't change them. Here are the predefined primary classifications you can choose for China:

• Standard Earnings

• Supplemental Earnings

• Taxable Benefits

• Direct Payments

Note: For standard earnings and supplemental earnings, the secondary classifications determine how the tax is calculated. Taxable benefits are always added to the taxable income. Direct payments aren't subject to tax.

Given below are some components you must consider when creating an earnings element for a China payroll.

Earnings Elements Processing

The processing of the earnings is controlled by proration.

Proration

Proration calculates proportionate amounts for recurring elements when payroll-relevant data changes during a payroll period, such as a person joining the enterprise or a mid-period pay increase. Proration creates two payroll run results: one for the payroll period up to the day before the event, and one from the date of the event to the end of the period. When you create an element, you specify its proration group, the proration rate conversion rule, and the proration units. This table lists the proration fields and the options that you can choose for each field.

Field	Option
Proration Group	Select a proration group.
Proration Rate Conversion Rule	Select any of these options: Standard Rate Annualized Standard Rate Daily Standard Working Hours Rate Annualized Assignment Working Hours Rate Annualized China Standard Rate Conversion (the default) Periodic Work Schedule Rate Annualized
Proration Units	Select any of these options: Hourly Daily Workday (the default)

As a guideline you must not prorate:

• Nonrecurring elements

• Earnings elements with a calculation rule of unit multiplied by rate, if rate and hours are entered in the element entry

Employment Level

Earnings are distributed by assignment. Assignments are associated to jurisdictions, which determine the required tax calculations.

Earnings at the assignment level require no distribution, as the assignment is associated to a single jurisdiction. Oracle Fusion Global Payroll determines the earnings distribution by jurisdiction and allocates the earnings based on standard hours worked.

Retroactive Pay

Retroactive pay is when an employee receives an adjustment in the current pay period, but the adjustment must have been effected in a previous payroll period. A recalculation is then required.

If you enable retroactive processing for an element, the retroactive pay event is associated with it and retroactive pay elements are automatically generated. When you enable retroactive processing, it:

• Recalculates them to find the changes.

• Adjust changes in the current payroll.