Setting Up Leave Payments and Leave Liability

If you want to record and calculate an employee's leave, leave payments and leave liability you must set up leave payments and leave liability when you have implemented Oracle HRMS for New Zealand.

Setting Up Leave Payments

Follow these steps if you want to use Oracle Payroll to pay for absences.

  1. Set up work day information and assignment standard conditions.

    Once you have created a Business Group, select the Others button and choose Work Day Information.

    Enter the default Working Hours and Frequency for the Business Group. The frequency must be "Week". Enter the defaults for Normal Start Time and End Time using 24-hour format.

    When you define accrual plan bands, the annual rate is assumed to be for an employee working the business group working hours.

    See: Business Groups and HR Organizations: Entering Work Day Defaults.

    See: Entering Additional Assignment Information.

  2. Set up absence management information.

    See Setting Up Absence Management

  3. Define hourly rate formulas:

    You can use the predefined formulas, configure these formulas, or write your own.

    Two formulas are supplied that calculate an hourly rate from a salary:

  4. Define element links.

    Link your absence elements and the following predefined payment elements:

    Annual Leave

    Sick Leave

    Public Holidays

  5. Set up formula result rules.

    You must also set up the following formula result rules from the Formula Result Rules window:

    Element Name: Annual Leave Pay

    Formula: NZ_STAT_ANNUAL_LEAVE_PAY

    Formula Results Name Type Element Input Value
    ADVANCE_LEAVE_HOURS Indirect Result Annual Leave in Advance In Advance Hours
    ADVANCE_LEAVE_PAYMENT Indirect Result Annual Leave in Advance In Advance Pay
    ANNIVERSARY_ DATE_CHANGE_MESG Message    
    ANNUAL_LEAVE_PAY Direct Result Annual Leave Pay Pay Value
    FATAL_MESG Message    

    Element Name: Annual Leave EOY Adjustment

    Formula: ANNUAL_LEAVE_EOY_ADJUSTMENT_CALCULATION

    Formula Results Name Type Element Input Value
    EOY_ADJUSTMENT_VALUE Direct Result Annual Leave EOY Adjustment Pay Value
    FATAL_MESG Message    
    IN_ADVANCE_CARRYOVER_HOURS Update Recurring Entry Annual Leave EOY Adjustment In Advance Carryover Hours
    IN_ADVANCE_CARRYOVER_PAY Update Recurring Entry Annual Leave EOY Adjustment In Advance Carryover Pay

    Element Name: Annual Leave Pay on Termination

    Formula: NZ_STAT_ANNUAL_LEAVE_PAY_ON_TERMINATION_CALCULATION

    Formula Results Name Type Element Input Value
    ANNUAL_LEAVE_PAY Direct Result Annual Leave Pay Pay Value
    FATAL_MESG Message    

    Element Name: Special Leave Pay

    Formula: NZ_STAT_SPECIAL_LEAVE_PAY_CALCULATION

    Formula Results Name Type Element Input Value
    SPECIAL_LEAVE_PAY Direct Special Leave Pay Pay Value
    UNPAID_SPECIAL_LEAVE_VALUE Indirect Unpaid Special Leave Value Unpaid Special Leave Value
    UNPAID_WARNING_MESG Message    

    Element Name: Public Holiday Pay

    Formula: NZ_STAT_PUBLIC_HOLIDAY_PAY_CALCULATION

    Name Type Element Input Value
    PUBLIC_HOLIDAY_PAY Direct Result Public Holiday Pay Pay Value

    Element Name: Annual Leave Payment

    Formula: NZ_ANNUAL_LEAVE_PAYMENT

    Name Type Element Input Value
    FATAL_MESG Message    
    L_ADVANCE_PAYMENT Indirect Result Annual Leave in Advance In Advance Pay
    L_TOTAL_PAYMENT Direct Result   Pay Value
    WARN_MESG Message    

    Element Name: Annual Leave Termination Pay

    Formula: NZ_ANNUAL_LEAVE_TERMINATION_PAYMENT

    Name Type Element Input Value
    FATAL_MESG Message    
    L_TOTAL_PAYMENT Direct Result Annual Leave Termination Pay Pay Value

    Element: Sick Leave Payment

    Formula: NZ_SICK_LEAVE_PAYMENT

    Name Type Element Input Value
    Unpaid Sick Leave Indirect Result Unpaid Sick Leave Value Unpaid Sick Leave Value
    Sick Leave Payment Direct Result   Pay Value
    Unpaid Warning Mesg Message    

  6. Associate hourly rate formulas with absence elements.

    Create formula processing rules to associate your hourly rate formulas with your absence and termination elements. Create formula result rules to feed the ordinary pay hourly rate as an indirect result to the Ordinary Pay Hourly Rate input value of the appropriate leave payment (or leave payment on termination) element.

    The formulas associated with absence elements should have an indirect result to feed the ordinary pay hourly rate to the Ordinary Pay Hourly Rate input value of the respective leave payment element.

    When you enrol an employee in an accrual plan, the system will prorate the accrual plan annual rate based on the proportion of the employee's working hours to the business group working hours.

    See Defining Formula Processing and Result Rules.

  7. Define accrual plans. The following predefined formulas are supplied:

  8. Enroll employees in accrual plans.

    See Enrolling Employees in PTO Accrual Plans.

  9. Set up secondary element classifications:

    Make sure that all of your earnings elements that should be considered for holidays are assigned one of the secondary classifications that feed the Gross Earnings for Holiday Pay balance. These are:

    See: Survey of the Classifications.

    Setting Up Leave Liability

    Follow these steps if you want to use Oracle Payroll for calculating leave liability:

    1. Set up and define your leave payments and accrual plans.

      See Setting Up Leave Payments.

    2. Define your hourly rate formulas.

      You can use the predefined hourly rate formulas, or define your own.

      Note: In order for leave liability processing to work you must write an hourly rate formula and ensure that the name of your hourly rate formula is returned by the formula "HOURLY_RATE_FORMULA".

      See Setting Up Leave Payments.

    3. Run the Annual Leave Liability Process.

      See: Running the Annual Leave Liability Process

    4. Run the Leave Liability report.

      See Running the Leave Liability Report.