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Indirect Valuation – Employee Central

Pay components are an integral part of Employee Central. In different scenarios the pay components or the amount of the pay component can be defaulted. Indirect valuation is a term widely used in ERP and not so often in the context of Employee central. The indirect here means that this is not manually entered by the admin it is derived /defaulted based on certain parameters.

Many of the customers are apprehensive about whether pay components and/or its amounts can be defaulted. The Implementation design principle explains how to automate pay components assignment and its valuation for the different employee groups and salary structures across different compensation-related processes in an effective way using MDF lookup tables, data model extensions and business rules
The following topics are explained in detail in this IDP

  • Defaulting Pay Components during Hire Action based on Collective agreements (Pay scale structure)
  • Defaulting of Pay Components during Job Change and based on FTE changes
  • Defaulting of Pay Components for Salary-Range Employees with Valuated Amounts
  • Defaulting of Pay Components for Salary-Range Employees without Valuated Amounts
  • Automatic split of Reference Annual Salary amount into multiple monthly/hourly Pay Components
  • Valuation of dependent pay components

The assignement of payscale pay components to employees during the hire process occurs immediatelly after the user has filled in the Job Info data, and before the compensation information is displayed (and therefore also before the data is saved). This is achieved by registering business rules for the indirect valuation on the “Pay Component Recurring Portlet” with event eype “onInit”.

 

 

Some of the interesting topics in the document on how should the salary amounts be reflected based on FTE changes.

 

 

Another interesting topic in this document is the annual salary split.
The annual salary can then be split into multiple pay components, typically these pay components are fixed percentages of the annual salary and depend on the employees pay frequency. The diagram below exemplifies the process steps during the hire process or job change process for splitting the annual salary

Please read the design principle document to get further insights with business rule snapshots and recommendations from

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