Third-Party Payment Methods

Create third-party payment methods for third-party persons or external organizations. Use either the Third-Party Personal Payment Methods task or the Third-Party Organization Payment Methods task to create.

Typical payments to third parties include:

  • Involuntary deductions, such as court-ordered garnishment.

  • Voluntary deductions, such as pension plan or union membership payments.

Note:

You must use the Third Parties task to create the third party and ensure the organization payment method for the payment source exists before you create a third-party payment method.

As you create your third-party organization payment methods, you will notice additional fields that can be captured, such as whether or not to exclude the third party from the Run Third-Party Payment Rollup process or to separate worker payments by reference. These identifiers will determine how these payees are paid and reported at the time of payment.

  • Use the Exclude from Third-Party Rollup Process checkbox, if you run the Run Third-Party Payment Rollup but have to pay certain third parties that require an individual check per employee payment. For example, the UK requires deduction from earnings orders, such as child maintenance payments, to be sent as separate transactions. By checking this box, payments to this third party, won't be rolled up into a single payment.

    Note:

    When checking this box, the Separate Worker Payments by Reference box is automatically checked because it's typical for an employee making multiple payments to this third party that each payment is to be reported by reference separately. However, you may deselect, if this is your requirement.

  • Use the Separate Worker Payments by Reference checkbox to generate employee payments to a given third party, based on reference. For example, if an employee is making multiple payments to a given third party, these can be generated separately, each with the corresponding reference.

    Note:

    The calculation card's calculation component has a reference field to uniquely identify the deduction, such as a court order number, case number, or other identifier provided by the issuing authority. The prepayment process breaks down the employee payments by this reference number captured against the employee deduction, which is mandatory for all countries.

You can still select the Separate Worker Payments by Reference checkbox even if you don't select the Exclude from Third-Party Payment Rollup Process checkbox to roll up the third-party payment and separate employee payments based on reference. These choices allow you to roll up the third-party payments during the Run Third-Party Payment Rollup process and separated out by on reference during the prepayments process the employee payments to that third party. You can then retrieve the information if you need to extract the details in the payment file, or reports. For example, you need to send a single consolidated payment to a loan company but you also need the employee payments paid to multiple loans at the same loan company separated out.

  • Use the Time Definition list of values to pay a third-party on a date that's different from the employee payment date. For example, you want to make employee payroll payments on the last day of the month and make third-party payments 5 days later.

To create a third-party organization payment method, follow these steps:

  1. Select the Third-Party Organization Payment Methods task.

  2. Click the Create icon.

  3. Select a Legislative Data Group.

  4. Select the Third-Party Name from the list.

  5. Select the Organization Payment Method from the list.

    Note:

    Payment Type and Currency populate based on chosen Organization Payment Method.

  6. Select Effective Start Date.

  7. Select Exclude from Third-Party Payment Rollup Process, if the third party isn't part of the Run Third-Party Payment Rollup.

  8. Select Separate Worker Payments by Reference if separate payments are generated for employee payments to a given third party, based on reference.

  9. Select the Time Definitions from the list, if you have defined a time definition to pay the third party on a different date than the rest of your third-party payments.

  10. If you're creating a direct deposit to a third party, perform these additional steps in the Bank Account region to create the associated bank account.

    • Click the Create icon.

    • At a minimum, fill in the required fields identified by an asterisk.

      • *Account Number

      • *Account Type

      • Check Digit

      • Account Holder

      • Secondary Account Reference

      • *Bank

      • *Bank Branch

      • *Routing Number

    • Click the Save and Done button.

  11. Click Save.

  12. Click Done.

To create a third-party organization payment method, follow these steps:

  1. Select the Third-Party Person Payment Methods task.

  2. Search and select an employee.

  3. Click the Create icon.

  4. Select a Legislative Data Group.

  5. Select the Third-Party Name from the list.

  6. Select the Organization Payment Method from the list.

    Note:

    Payment Type and Currency are based on chosen Organization Payment Method.

  7. Select Effective Start Date.

  8. If you're creating a direct deposit to a third party, perform these additional steps in the Bank Account region to create the associated bank account.

    • Click the Create icon.

    • At a minimum, fill in the required fields identified by an asterisk.

      • *Account Number

      • *Account Type

      • Check Digit

      • Account Holder

      • Secondary Account Reference

      • *Bank

      • *Bank Branch

      • *Routing Number

    • Click the Save and Done button.

      Note:

      Depending on your localization, these may differ.

  9. Click Save.

  10. Click Done.

Note:

The payroll relationship is defaulted for the employee making the payment to the third party. However, if you create a third-party personal payment method, as part of creating your third party, you must select the payroll relationship(s) of the person making payment to the third party.