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In this blog we are going to see that how in Employee Central we can default Pay Components and Values against each pay component based on Total CTC.

This solution will help in eliminating manual entry of pay components to get the annualized salary. This is one of the most common requirement in many countries. I am going to take an example of India in my blog.

Lets consider Total CTC as 100000 and defaulting pay components and values as mentioned in below example during new hire joining

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Hiring New Employee CompTestEmployee 17.

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In Compensation Information Portlet, Enter Total CTC Value e.g. 100000. and save.

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Go to Compensation Information Portlet of new hire and check the pay components getting defaulted automatically based on total CTC value entered.

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How to achieve above solution?


  1. Create Pay Components
  •      Create Pay Components such as CTC, Basic, House Rent Allowance, Provident Fund, Transport etc as mentioned in below screen shots.
  • Pay attention to “Pay Component Type“, this has to be defined correctly whether to choose Amount, Percentage or Number and “Base Pay Component Group“.
  • Since CTC is used a direct amount, we define it a Amount.

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  • As Basic Pay is 35% of CTC, hence in this case “Pay Component Type” will be “percentage” and “Base Pay Component Group” will be CTC(9999).

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  • House Rent Allowance is 50% of Basic Pay, Hence in this case “Pay Component Type” will be “percentage” and “Base Pay Component Group” will be “Basic Pay”.

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  • Since Transport or Medical is direct amount, it can be defined as “Amount”1.9.PNG
  • Similarly rest of the pay components like PF, Gratuity , LTA etc can be defined.

  2. Create Pay Component Group having all Pay Components excluding CTC


  • Create a group to get the sum of all the pay components excluding CTC. This group will be used in calculation of Supplementary Allowance or Special Allowance or Balance Amount.
  • You can also write a business rule to get the total of all the pay components but I prefer to follow this approach.

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3. Create Custom Field as “Total CTC” in compensation Information Portlet.

  • This field is used to enter the amount against CTC during hiring process.
  • This field can also be integrated with onboarding so that this value can get defaulted during onboarding of new hire.

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4. Create Business Rules


  • You can design your business rules based on below base
    • Job Information
    • Job Information Model
    • Employee Information
    • Employee Information Model
    • Compensation Information
    • Compensation Information Model

     In this situation I wrote rules based on Compensation Information. Similar rules can be written on Job Information Model which I will show in my next blog.

  

     I have written three business rules to default the pay components.

    1. Business Rule for defaulting Pay Component CTC(9999), with this rule you can populate the value from Total CTC in this pay component.
    2. Business Rule for defaulting supplementary allowance.
    3. Business Rule for defaulting all the required Pay Components for e.g. Basic, HRA, PF, Gratuity, Transport etc

Rule 1

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Rule 2

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Rule 3

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5. Assign all the created Business Rules to Compensation Information in “Manage Business Configuration”


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Summary


This was a small effort to create a complex pay structure in Employee Central using Business Rules. In the above entry I have used Compensation Information as base but you can also use Job Information Model. We can also add or delete pay components in case Promotion/Transfer or any other action in Employee Central using this approach.

By using above method, we can eliminate the requirement of adding pay components manually and our approach becomes formulaic. Same approach can be used in case you want to make use of “Pay Scale Level”.

Writing Business Rules are more about imagination and creativity. We can write different types of rules to arrive at same result. This is one of the approach which I have followed.

This is my 1st Blog in SCN, if you like it then please rate it

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9 Comments

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  1. Rakesh Kumar

    Hi Smita,

    Nice document,well presented and good logic in Business rules for configuration of pay component in SF employee central payroll.

    Please explain about the approver process i.e Wfconfig process.

    All the best

    Regards,

    Rakesh

    (0) 
  2. Carly Skonicki

    Is there anyway to add this CTC Breakdown in the Recruiting module without the Recruiter manually performing and entering the calculation? This is something we’d like to see on the Offer Letters.

     

    Thanks,

    Carly

    (0) 

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