Absence Rate for Reducing Pensionable Pay to Exclude Non-Pensionable Allowances

An absence rate that includes nonpensionable allowances (for example, subsistence) requires a second absence rate definition.

This is to ensure that the pensionable earnings are reduced correctly, in cases where an employee is receiving reduced absence pay. This additional rate ensures that their pensionable pay is reduced using the pensionable elements of their absence payment only.

Follow the steps described here to create an additional absence rate that excludes nonpensionable allowance rate definitions as contributors.

Prerequisites

Element and rate definition for (pensionable) salary element
Element and rate definition for pensionable elements
Element and rate definition for non-pensionable elements
Element and rate definition for absence payment/deduction
- Absence element processing priority must be later than that of the salary and allowance elements
Rate definition category: Derived rate
- Contributors: Rate definitions for salary, non-pensionable and pensionable elements

Reduced Pensionable Pay Rate Setup

Create a rate definition for the reduced pensionable pay rate:
- Category: Derived rate
- Periodicity: Annual
- Live rates: Checked by default
- Contributors: Salary and pensionable allowance rate definitions
Create calculation value definition:
- Calculation type: Rate definition
- Retrieval date: Date earned
- Calculation values: Rate definition created in Step 1
Add a calculation factor to the Entitlement Result absence element.
- Calculation type: Rate amount
- Calculation value definition: Select the definition created in Step 2.
Edit the Entitlement Result element formula to fetch the pensionable pay value, convert it to a daily value and return the daily reducing pensionable pay. Refer to the Reduced Pensionable Pay Entitlement Result_ff_May2025.txt file attached to Document ID 2687236.1.

Add the following code in the absence entitlement result formula:

IF (Absence_Type = 'ORA_HRX_GB_SM') OR (Absence_Type = 'ORA_HRX_GB_SPA') OR (Absence_Type = 'ORA_HRX_GB_SPB') OR (Absence_Type = 'ORA_HRX_GB_SA')
OR (Absence_Type = 'ORA_HRX_GB_SPLA') OR (Absence_Type = 'ORA_HRX_GB_SPLB') OR (Absence_Type = 'ORA_HRX_GB_SS') OR(Absence_Type = 'ORA_HRX_GB_SDM') THEN
(
…
…
)
ELSE
(
….
….
net_pay = pay_value  + deduction

/*Code for reducing pensionable pay*/
l_amount = 0
l_daily_amount = 0
l_reduce_pp = 0
l_reporting_uom = 'ND'
l_src_periodicity = 'DAILY'
l_np_daily_adj_val = 0
l_calc_daily_adj_val = 0
			
l_rate_formula = 'ANNUALIZED RATE CONVERSION'
CHANGE_CONTEXTS(PART_NAME = 'ORA_RATE_FORMULA')
(
  IF (CALC_DIR_EXISTS() = 'Y') THEN
  (
    l_rate_formula = CALC_DIR_TEXT_VALUE(0)
    l_log = PAY_INTERNAL_LOG_WRITE('AP_RATE_PP_REDUCTION - Rate Conversion Formula        ::::' || l_rate_formula )
  )
)		
CHANGE_CONTEXTS(PART_NAME = 'ORA_RESULT_REPORTING_UOM')
 (
   IF (CALC_DIR_EXISTS() = 'Y') THEN
   (
     l_reporting_uom = CALC_DIR_TEXT_VALUE(0)
     l_log = PAY_INTERNAL_LOG_WRITE('AP_RATE_PP_REDUCTION - Reporting UOM         ::::' || l_reporting_uom )
   )
 )	
	   
change_contexts(PART_NAME = 'ORA_RATE_AMOUNT')
(
  SET_INPUT('BASE',0)
  EXECUTE('CALL_CALC_VALUE')
  l_amount = GET_OUTPUT('DED_AMOUNT',0) 
  l_src_periodicity  = GET_OUTPUT('PERIODICITY','DAILY')
) 

l_log = PAY_INTERNAL_LOG_WRITE('[AP_OSP_DED_ENTITLEMENT_RESULT] - AP_RATE_PP_REDUCTION    OUTPUT   : '|| to_char(l_amount))
IF (l_amount > 0) THEN   
(
  CALL_FORMULA('ORA_RATE_CALCULATOR',
              'RATE' > 'in_calc_type',
              l_reporting_uom > 'in_reporting_uom',
              l_rate_formula>'in_method',
              l_amount > 'in_rate' ,
              l_src_periodicity  > 'in_src_periodicity' ,
              l_daily_amount < 'out_calc_amount' DEFAULT -1 )

  l_log = PAY_INTERNAL_LOG_WRITE('[AP_OSP_DED_ENTITLEMENT_RESULT] - AP_RATE_PP_REDUCTION  DAILY  OUTPUT   : '|| to_char(l_daily_amount))
  l_reduce_pp = l_daily_amount * (1 - factor)
  l_log = PAY_INTERNAL_LOG_WRITE('[AP_OSP_DED_ENTITLEMENT_RESULT] - AP_RATE_PP_REDUCTION  Reduced PP  OUTPUT   : '|| to_char(l_reduce_pp))
  l_calc_daily_adj_val = l_daily_amount - ded_amount_rate
  l_log = PAY_INTERNAL_LOG_WRITE('[AP_OSP_DED_ENTITLEMENT_RESULT] - AP_RATE_PP_REDUCTION  l_calc_daily_adj_val   : '|| to_char(l_calc_daily_adj_val))
  
  IF l_calc_daily_adj_val <> 0
  THEN
  (
   l_np_daily_adj_val = -(net_pay + l_reduce_pp)
  )
  l_log = PAY_INTERNAL_LOG_WRITE('[AP_OSP_DED_ENTITLEMENT_RESULT] - AP_RATE_PP_REDUCTION NP Daily Adj Value  OUTPUT   : '|| to_char(l_np_daily_adj_val))
)
/*return l_reduce_pp as direct or indirect result*/
…
…
RETURN unit ,reduce_type ,…………….    ,l_reduce_pp, l_np_daily_adj_val

Edit the Entitlement Result element and create new input values to return direct result of daily reduction of pensionable pay and daily adjusted value.
Alternatively, create a separate element for returning the daily reduced pensionable pay as an indirect result.
Add a new formula result rule on the Entitlement Result element for returning the reduced pensionable pay value:
- Result returned: L_REDUCE_PP
- Result rule: Direct result (using the Entitlement Result element)
- Target input value: New input value (e.g. Reduced Pensionable Pay)
Alternatively, create a separate element for returning the daily adjusted value as an indirect result.
Add a new formula result rule on the Entitlement Result element for returning the daily adjusted value:
- Result returned: L_NP_DAILY_ADJ_VAL
- Result rule: Direct result (using the Entitlement Result element) / indirect result (using a separate element)
- Target input value: New input value (e.g. Daily Adjusted Amount/Amount)