Define Voluntary and Pre-statutory Deductions

Use the Elements task to define voluntary and pre-statutory deductions, such as pensions. You can manage pension deductions through calculation cards or element entries, depending on country-specific rules.

You can also manage other voluntary deductions, such as gym membership, union membership, and charity donations, through element entries.

Use these steps to set up deductions:

1. Define the elements.

2. Define the third-party payees.

3. Define a third-party payment method for each third-party payee.

4. Enter the deduction details for each person. Do this in the following ways, depending on the deduction type and your setup:

   • Configure a Benefits and Pensions calculation card.

   • Define element entry.

   • Load benefit batches.

Defining Elements

When you define a pension plan deduction, if you select the Benefit category, or it's selected for you, the element template defines a calculation component. You add this component to Benefits and Pensions calculation cards to assign it to your workers.

To define other voluntary deductions:

• Select the Standard category.

  This selection means you manage these deductions using the Element Entries task.

• After defining the element, you must add a Payee input value and select Third-Party Payee as the special purpose for it.

  If appropriate, enter a default value on the element or element eligibility record to populate the third-party payee details.

  Note: You can streamline the creation of Voluntary Deduction and Pretax Deduction elements by reducing the number of rules created. The application creates stop rules only if you had selected the total owned option when you created the element. If you had selected No for the template question Processing Stop when the Total is Reached, the application doesn't create the stop rule for the element.

Defining Third-Party Payees

To define third-party payees, use the Third Parties page in the Administration section.

For pensions, select the Organization payee type and select the Pension Provider party usage code.

Defining Third-Party Payment Methods

To define payment methods for all external payees, you can use the Third-Party Payment Methods task in the Person Information section.

Entering Deduction Details for Each Person

For pensions using the Benefit category:

1. Configure a Benefits and Pensions calculation card for the worker.

2. Add your new pension calculation component to the card.

3. Enter the payee and other details.

If you load your pension information using the Load Benefit Batches process, the payroll application configures the calculation card automatically. Before running this process, you must generate an XML file that contains the data you want to transfer to payroll.

For other voluntary deductions, you must define element entries. If the payee isn't defaulted from the element or eligibility record, enter the payee on the element entry.