SAP HR Payroll

- RAGHU

Composite Roles in Payroll

Payroll

Payroll
Broadly speaking, payroll is used to calculate remuneration for work performed by individual employees. More specifically, payroll is an umbrella term for a variety of work processes, such as the creation of payroll results and remuneration statements, bank transfers, and payments by check. The phrase also covers a number of subsequent activities such as the posting of results to Accounting and other evaluations, for example, for taxes

Overview of Payroll Process

Overview of Payroll Process

Remuneration is calculated in two main steps:
Calculation of wage elements Statutory and voluntary deductions (which are country-specific)

Wage elements, statutory deductions, and voluntary deductions are all based on the individual payments and deductions that are calculated for an employee during a payroll period. The payments and deductions are stored as wage types and then included in the payroll calculation.

Calculation of Wage Elements

Calculation of Wage Elements

An employee's wage elements are determined on the basis of the individual wage types used in a payroll period. Payments that may be included in the calculation of remuneration are, for example, basic pay, bonuses, vacation allowances, Christmas bonuses, and gratuities. Company-owned apartments, company-sponsored day care services and the like can all cause deductions from an employee's pay. The wage types can be entered online or generated during the payroll run using rule tables.

Statutory and Voluntary Deductions

Statutory and Voluntary Deductions

To determine the payment amount, statutory and voluntary deductions, such as taxes and social insurance contributions, are effected. The deductions are calculated on the basis of gross values, such as the total gross amount and the gross tax amount. For this reason, various amounts are calculated during the payroll run which are then used for subsequent processing.

HR Master Data

The R/3 System assigns a start date and an end date to HR master data, as well as a large number of Customizing table entries. The payroll program requires these dates so that it can perform calculations for specific days, and retroactive accounting for previous periods. The system automatically recognizes changes to payment infotypes and triggers retroactive accounting, for example, after a salary change. Because of automatic retroactive accounting recognition, the R/3 System does not allow you to change the payroll results manually.

Retroactive Accounting

Retroactive Accounting
You have completed the payroll run for this period. However, if you then change HR master data in a period for which the payroll has already been run, the payroll must be run once again for this period using the current values. This is known as retroactive accounting. All of the periods for which you have completed and exited payroll constitute the payroll past. If you maintain an infotype that is relevant to retroactive accounting, the Earliest MD Change Field in the Payroll Status infotype (0003) is set to the start date of the changed infotype. This ensures that retroactive accounting is automatically triggered up to this retroactive accounting date when the next payroll run is performed.

Payroll Prerequisites

Overview Personnel Processes

Overview Personnel Processes

During an employee's employment relationship a series of events take place. These can be relevant to remuneration. If these events occur in the payroll past, they trigger retroactive accounting. If an employee leaves your enterprise you should not delimit information regarding their remuneration and bank details immediately, as you may need this information in the event of a retroactive accounting salary change. When an employee rejoins the company they are given their old personnel number again so that it is possible to have the employee's complete history.

Hiring

Hiring
A hiring action consists of a series of different infotypes. Some of these infotypes, such as the ones listed on the left-hand side of the graphic, are the same for all countries. Furthermore, each country is assigned infotypes that are country-specific. They enable you to enter tax data, for example. If you set your user parameters for a particular country, such as 01 for Germany or 10 for the USA, the system accesses the correct personnel actions, which include all of the relevant country-specific infotypes.

Organizational Reassignment

Employee data can be changed in any payroll period. Such changes may be concerned with transfers, substitutions, increases or decreases in basic pay, or simply corrections. New data is either created or copied, while corrections are made by changing existing data. Sometimes, the data must be entered in a series of infotypes. At other times, you are only required to access a single infotype. Do not forget that changes made to infotypes that are relevant to payroll, in periods for which the payroll has already run, automatically trigger retroactive accounting.

Deviations from the Work Schedule

Departures from the work schedule usually constitute the largest share of tasks that are periodically performed in a Human Resources department. In the system itself, such departures take the form of time data, such as hours or days, or remuneration data. To ensure that the correct amount of time in lieu and overtime payments are available, it is important that they are entered in the system at the right time.

Deviations from the Work Schedule

The following infotypes are used to enter data that does not adhere to the work schedule: Absences - 2001: Used to enter employee absences. Attendances - 2002: Used to enter employee attendances. Substitutions - 2003: Used to enter substitutions, such as when an employee works a different shift. Availability - 2004: Used, for example, to enter times at which an employee is available for duty in addition to his or her regular shift. Overtime - 2005: Used to enter start times and end times for additional working hours. The system automatically generates wage types in accordance with rules that can be specified in Customizing. EE Remuneration Information - 2010: Used, for example, to enter overtime manually. Monthly Calendar - 2051: Used to enter attendances and absences in a monthly overview screen. Weekly Calendar -2052: Used to enter attendances and absences in a weekly overview screen

Methods of Entering Time Data

Methods of Entering Time Data

Fast data entry enables you to create and maintain the same infotype record for more than one employee at the same time. This means that you do not have to enter a separate record for each individual employee, and that a single screen enables you to enter the data for more than one employee simultaneously. This results in faster, more efficient data processing. All of the various types of processing (creating, changing, copying, deleting, and locking/unlocking) are available. There are four different ways of selecting the personnel numbers to be processed:
You can enter the personnel numbers directly in the fast entry screen You can list the personnel numbers yourself before maintaining the fast entry screen You can use a report to list the personnel numbers on the basis of specific search criteria You can choose your own selection criteria using the Ad Hoc Query

Overview Payroll Organization

Overview Payroll Organization

You must make some basic settings in Customizing to be able to run payroll in the SAP System. A period parameter and a date modifier are assigned to each payroll area. The period parameter determines whether payroll is run monthly, bi-monthly, weekly or for several weeks. Each period parameter used is assigned to a time unit. The values for the time units are defined (monthly, semi-monthly, weekly, bi-weekly, every four weeks, and annually.) Payroll periods must be generated for each combination of period parameters and date modifiers assigned to a payroll area. All periods within the specified time interval are defined based on the period parameter. The start date and end date for each period is defined and the payday is calculated using a rule entered as a parameter. The payroll year and period define the exact dates for the payroll period. You must create a control record for every payroll area. This control record controls the individual stages of payroll.

Setup the Payroll System in Customizing

The necessary administrative elements, for example, payroll area and period, payroll control record and the employee payroll status are explained in the following section. You find the IMG steps in Customizing for Payroll for your country under >Environment > Payroll Organization

Payroll Areas

Payroll Areas
The SAP HR System uses payroll areas to group together employees for whom payroll is run at the same time, and also to set the dates for the payroll period. Employees from different employee subgroups can belong to the same payroll area. For example, an organization may pay employees on a monthly and weekly basis so at least one monthly and one weekly payroll area must be created. You must also create payroll areas if you want to run payroll for employees at different times.

Payroll Areas
The payroll area is used as a selection criterion for many payroll processes. For example, for the payroll run, the remuneration statement, and evaluation reports for the payroll run. If you want to select fewer employees for a payroll run or other evaluations, you can also use additional selection criteria, for example, the cost center, or employee subgroup. (However, such a selection is only suitable for test and simulation purposes, as the payroll control record is not taken into account). Feature ABKRS delivers a default value for the 'Payroll Area' field in infotype 0001(Organizational Assignment).

Payroll Periods

A payroll period determines the period for which a payroll result is created. The length of payroll periods can differ, for example, a payroll period can be a month, a week, or fourteen days. The exact start date and end date of the periods must be defined for the payroll areas. This data is generated automatically when the program is started.

Generate Payroll Periods

Generate Payroll Periods

Payroll periods are linked to the time units using the 'Generate Payroll Periods' step in the Implementation Guide (IMG). You also specify how paydays are defined and enter the start date of the tax year. In addition to the start and end date for a period and the pay date, it is also possible to define a date modifier as an additional payroll date. This modifier links the additional date types with a payroll calendar. In addition to the date specifications for the standard payroll interval, you can also create additional date specifications for each period in the payroll calendar. These additional date specifications can be used, for example, to store the pay date.

Generate Payroll Periods

Generate Payroll Periods

Payday rule / Number of days: These two fields determine how the period payday is calculated. The following values can be used for the payday rule: 1 : The number of days is added to the start date of the period to calculate the payday. 2 : The number of days is deducted from the end date of the period. 3 : The number of days is added to the end date of the period. 4 : Only applies to monthly periods, the number is used as the exact date. Determine period number: In this field you define which date of the payroll period the system uses to determine the period number. The system uses the period number in the payroll control record to increse the payroll periods sequentially for a year. With every new tax year the period number is reset to one.

Generating the Calendar for Cumulations

Generating the Calendar for Cumulations

In some countries, the calendar is used for reporting purposes. During payroll, some wage types are cumulated over several periods to create monthly, quarterly, or annual totals. By generating the calendar, each payroll period is assigned to a particular quarter, half-year, or year. The calendar must be generated for each combination of period parameters and date modifiers assigned to a payroll area. A parameter in the selection screen determines the date in the payroll period (start date, end date, or payday date) on which this assignment is based. You generate this cumulation calendar for several years in advance using a Customizing report.

Payroll Control Record

Payroll Control Record

You must create a control record in Customizing for each payroll area before it can be used. The personnel control record performs the following functions in payroll: Defines the payroll past for retroactive accounting recognition. Locks master data and time data so no changes can be made during the payroll process. The lock is valid for the payroll past and the payroll present. Changes affecting future payroll runs are still possible. Defines the earliest possible retroactive accounting date for each payroll area. You find the control record in the payroll menu for your country under Tools > Control Record. You can also use the payroll menu for your country to control the different stages of payroll.

Payroll Control Record - Periods

Payroll Control Record - Periods

You must pay particular attention when creating the payroll control record in your live system. The payroll period used to create the payroll control records must be 1 period before the period in which you want to go live. Example: You want to use the SAP Payroll system to go live in period 05, 2001. You must enter period 04, 2001 in the payroll control record.

Payroll Status Infotype-System

Payroll Status Infotype - Manually

RA limits 3 Scenarios

RA limits 3 Scenarios
The retroactive accounting limit determines the exact date until which master data and time data can be changed in the payroll past. The retroactive accounting limit is based on the following values:

Per payroll area (payroll control record): Earliest possible retroactive accounting period Employee hiring date Per employee (Payroll Status infotype): Earliest personal retroactive accounting date

If the date set for each payroll area differs from the date specified for the employee, the later date is used. The absolute retroactive accounting limit for an employee is the hire date.

Overview of Payroll Process

Payroll Process
During the payroll run, master data and time data changes that affect the payroll past and payroll present are not permitted. The payroll program reads the master data and time data infotypes, which means that changes effected during the payroll run could jeopardize the accuracy of the payroll results. It also means that you must not run the payroll during master data maintenance. This is controlled by the payroll control record.

Payroll Process
The relationship between the menu and payroll control record is as follows: Function in menu Status of PCR Release payroll Release for payroll Start payroll The payroll program is started and the status of the payroll control record remains "released for payroll" Check result Check payroll results Corrections Release for correction Exit payroll Exit payroll

Payroll Simulation

Payroll Simulation
When payroll periods are counted in the control record, simulation runs are ignored. Furthermore, simulation runs do not lock master data. You are not required to use the Release Payroll and Exit Payroll functions when simulating a payroll run. The results of a simulated payroll run are not written to the database. Instead, they are displayed in the payroll log. Simulating a payroll run enables you to display and print the remuneration statement.

Release Payroll

Release Payroll
If you choose the function Release Payroll from the menu, you are prevented from changing infotype data records if such changes affect the past or present. This lock applies to the personnel numbers included in the payroll area concerned. Changes that affect the future are still permitted. You must execute this function in the menu before starting the payroll. If the status of the payroll control record was previously Exit Payroll, the Release Payroll function also has the effect of increasing the period in the payroll control record by 1.

Start Payroll

Start Payroll
The payroll area is used to determine the payroll period with exact dates as well as to select personnel numbers. For this reason you have to enter the payroll area in both the Payroll Period and Selection sections. Prerequisite: The personnel control record must be maintained. Advantage: When a live payroll is run, you are not required to enter the payroll period. Instead, the system uses the payroll area and the control record to determine the payroll period automatically. Alternatively, you can enter a different payroll period (for a simulation run).

Start Payroll

You must make an entry in the "Forced retroactive accounting as of" field if a retroactive run is to be carried out that will not be automatically recognized by the system (for example, changes in Customizing tables). The "payroll schema" describes the sequence and the contents of a program procedure. It consists of a list of statements and links to subschemas and functions, which are described in more detail using parameters. The program processes the specified personnel calculation schema step for step, that is, sequentially. If the "test run" flag is set, no changes are made to the database. That is, the function UPD YES is overridden. This also affects the newly-generated schema. This flag must be set during a payroll simulation run. It must not be set during a regular payroll run.

Payroll Log

Payroll Log
The payroll results are displayed in a tree structure. This makes it easier for you to analyze and get an overview of the payroll results. The log includes a table of contents, which is presented as a tree structure. The nodes within the tree structure enable you to access the detailed information that you require. The headers within the structure are designed to help you with troubleshooting and to facilitate navigation within the log. Depending on the information that you require, you either expand or collapse individual nodes within the tree structure as necessary.

Detailed View of a Processing Step

Rejected Personnel Numbers

If an error occurs when a personnel number is processed, the log is expanded at the appropriate place and an error message is displayed

Matchcode W

Matchcode W provides a list of all personnel numbers in the selected payroll area that have been rejected by the payroll run because of incorrect data. This means that the payroll has not run for them successfully. Personnel numbers are also included in matchcode W if personnel data is changed in the correction phase of the payroll run.

Matchcode W
To display matchcode W, proceed as follows:

In the Payroll menu for your country, select Tools> Control Record. Enter a payroll area and choose Display. Choose the menu path Goto -> Incorrect pers. nos. A list is displayed of all personnel numbers assigned to the selected payroll area that have been rejected because of incorrect data.

Check Payroll Results

By choosing Check Result, you ensure that changes cannot be made to payroll data if they affect the present or past. This function also locks the payroll accounting area concerned to prevent you from including it in a payroll run, that is, you cannot start the payroll. "Freezing" the payroll in this way enables you to check the payroll results

Check Payroll Results

By choosing Check Result, you ensure that changes cannot be made to payroll data if they affect the present or past. This function also locks the payroll accounting area concerned to prevent you from including it in a payroll run, that is, you cannot start the payroll. "Freezing" the payroll in this way enables you to check the payroll results

Correction /Release for Correction

Exit Payroll

Exit Payroll
The Exit Payroll function enables you to re-release infotypes so that they can be maintained for the past and present, and the payroll area is locked for the payroll run. You cannot exit payroll until the payroll has run successfully for all of the personnel numbers assigned to the selected payroll area (which means that matchcode W is empty). If you attempt to choose this function and rejected personnel numbers still exist, the system displays an error message. After you have exited the payroll, you can only change data for the period in question by performing retroactive accounting in a subsequent payroll period.