Reduce Eligible Compensation to Exclude Non-Pensionable Sickness Payment Amount

Additional setup is required for the scenario where a member is on a sickness absence, and mid-period, their pay reduces from 50% or more (pensionable pay) to less than 50% (non-pensionable pay).

In this situation, the non-pensionable pay amount must reduce the eligible compensation amount that determines the member’s pensionable earnings for the period.

Follow the steps described here to reduce that amount using an Information element and new balance.

You must also make formula changes to the following formulas:

• Absence Entitlement Result formulas (<Absence Element Name> Entitlement Result) for occupational sickness-related absences
• TPS Pension Calculator formula (<TPS Scheme Name> Calculator) - for pension schemes created on or before release 22D
• TPS Pension Distributor formula (<TPS Scheme Name> Distributor) - for pension schemes created on or before release 22D

These formula changes are described in combination with the multiple assignment formula changes included in the Multiple Assignments and Absences section.

Note: If the absence payment is never pensionable, irrespective of its payment factor, for example, a subsistence allowance, refer to the section Absence Rate for Reducing Pensionable Pay to Exclude Non-Pensionable Allowances, to exclude those allowances from a member’s eligible compensation.

Information Element for Non-Pensionable Absence Payment Amount

Using the Elements task, create a nonrecurring Information element that will hold the value of the non-pensionable amount of pay (l_Unpaid_Value) returned by the occupational sickness Entitlement Result formula.

Attribute	Description
Primary Classification	Information
Recurring Entry	Nonrecurring
Input Value	Monetary, for example, Amount
Allow Multiple Entries in Same Period	Yes
Processing Priority	Higher than the processing priority of the occupational sickness entitlement result absence element

Status Processing Rule for Occupational Entitlement Result Element

Using the Elements task, open the occupational sickness plan absence element and create a new status processing rule for the l_Unpaid_Value formula result to return it as an indirect result:

Result Returned	Result Rule	Target Element Name	Target Input Value
L_UNPAID_VALUE	Indirect Result	Information Element created previously	Monetary input value created previously

Note: If your previously created Information element isn’t listed, check its processing priority.

Non-Pensionable Absence Payment TPS Balance Feed

The Non-Pensionable Absence Payment TPS balance holds the non-pensionable payment value; that is, the amount of non-pensionable earnings that will reduce the eligible compensation balance during pension calculation so that the pension is calculated using pensionable earnings only. Using the Balance Definitions task, feed the balance Non-Pensionable Absence Payment TPS (balance category: Information) with the input value from your previously created Information element (into which the l_Unpaid_Value will be returned).