1. Using Common Features for HCM
  2. How You Store the Salary Amount and Pass It to Payroll for Processing

How You Store the Salary Amount and Pass It to Payroll for Processing

The salary basis holds the overall salary amount from the salary record. It passes the amount to the element entry for payroll processing each pay period.

Legislative Data Group (LDG)

You configure each salary basis for a specified LDG. If your organization has multiple LDGs, you need to create a uniquely named salary basis for each unique set of characteristics applicable to each LDG. The LDG limits the payroll elements that you can associate with the salary basis.

Payroll Element

You attach a single payroll element to each salary basis to hold the overall salary amount. The elements that you can select from meet these criteria:

  • They're valid for the selected LDG.
  • They recur.
  • They're either Earning or Information elements.
  • They include eligibility definitions.

    The required element eligibility definition can include eligibility criteria. We recommend that you leave the eligibility open on the payroll element.

Make sure that individual compensation doesn't also use the element you select. Using the same element across compensation objects can lead to payroll conflicts. It can also lead to unexpected deletions of salary or individual compensation.

Restrictions

You can link recurring elements to multiple salary bases only if they meet these conditions:

  • Headquarters-based grades have a base pay of X.

  • Grades for all other locations have a base pay of X - 2%.

Input Value

An element can have multiple input values. The element input value that you select in the salary basis, such as Amount, is the value that stores the salary amount.

The monetary amount stored in the element entry is the salary amount in the salary information for the person's assignment. That salary amount is in the frequency of the person's salary basis, such as annually or hourly.

If you don't use Oracle Fusion Global Payroll, you can store the salary amount using information payroll elements.

  • If the element includes the Periodicity input value, the element entry stores the annual salary amount.
  • If the element doesn't include the Periodicity input value, the element entry stores the salary amount in the same frequency as the salary basis.

Here's how the payroll formula processes the input values of element entries received in the frequency of the salary basis:

Salary Basis Frequency Amount Passed to Payroll Payroll Processing
Annually Annual amount Converts the annual amount to the appropriate payroll period amount.
Hourly Hourly rate Multiplies the hourly rate by the number of hours reported for the payroll period.

The resulting base pay earnings appear on the payslip for the payroll element associated with the salary basis.

Currency

The element currency automatically decides the salary basis currency used to pay the person.

Reference

The Configuring Payroll Elements for Use in Oracle Fusion Compensation document (ID 1589502.1) explains how compensation uses payroll elements. It also explains how to configure the elements for specific uses.

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