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MAINTAIN PREMIUMS#

Premiums are used to track and pay extra time and earnings that are not strictly wages. Premiums are created and maintained on the Define Premiums (ISPM) screen.

Premium Data is maintained on the P2K_SA_PREMIUMS and P2K_SA_PREMIUM_DETAILS tables.

Premium

Enter the name of the premium in this field. It is not necessary to build into the name any reference to the unit, it is acceptable (and recommended) to use the same premium codes across multiple units. In this way, a “night shift” premium is always the same code with different rates which are employed based on the union/unit of the employee.

Unit

Each premium must be associated with a unit which may be identified in this field.

Entity

Units are associated with an entity which is identified in this field. This value presented is for information use only and may not be updated by users.

Premium Type

In this field, you may categorize the premium into one of the premium types created in the ISPT form.

Type Sequence

The sequence field is used to determine an order of priority for premiums. Users may enter a sequence number to define the order of the premium. This sequence will override the sequential order defined before (pay line over assignment over position over job) and is only applicable to the Time Scheduling module.
This feature works for all premiums of the same type.

Example:
Unit - Hourly has two premiums with the Premium Type of TIME; MINREST and TIMEOT

• MINREST pays double-time and TIMEOT pay time-and-a-half.
• MINREST is added to the Time Entries upon Clock OUT for the MIN HRS BTW SHFT Time Rule.
• TIMEOT is added to the Time Entries and Pay Transactions for the PREM TIME OF DAY Time Rule.

Previously this meant that the TIMEOT premium would override the MINREST premium as related to order of processing. By making the ‘Sequence’ of the TIMEOT premium ‘1’ and the ‘Sequence’ of the MINREST premium ‘2’, the MINREST premium will be applied instead of the TIMEOT premium if both are encountered by the UTTG process.

Description

This field holds a description of the premium code created.

Rules#

Premium Rate

This is the rate that will be used when the Premium Calc rule includes “premium rate” in the formula. If the rule indicates premium rate (Prem Rt) then enter the rate as a percentage amount (0.50 for 50%) or a flat amount (100 for a fitness club premium). If the rule indicates a premium percentage (Prem Prc) then enter the percentage as a whole number (25 for 25%).

Note that this rate is the default rate, but that it may be overridden, if necessary, for individual jobs, positions, assignments, or transactions (as long as the user has proper security clearance to do so).

Rate Basis

This field defines the time period (hour, day, week, year) used with the premium rate value provided.

Premium Calc Rule

Premium Calc rule is the rule that will be used to calculate the premium. There are a number of formulas provided. Below is a table that outlines the calc rule from the LOV, the formula it represents, whether a pro-ration is applicable, and an example of each rule. An explanation of the use of FTE Pro-ration follows the table.

If the premium calculation rule uses a user variable, that user variable must be on the Time Pay component in order for this premium calculation to work.

Custom Premium Logic

If you require custom premium logic, contact your consultant.

Premium Wage Source

This field allows you to define the source of the premium, either from the pay line or from the highest scale/step rate on the position record.

Frequency

This field indicates how often, or for what types of pay, the transaction line will be created. Wiki uses the term “frequency” to control the timing of payroll deductions, benefits, and earnings. Frequencies are defined during Payroll training and once created may be accessed by the LOV.

‘Frequency’ is only applicable to the “Prem per Period” and “UPTG Period Premium” calculation method. However, if either of those methods are used, frequency is REQUIRED.

User Variable

This field allows you to choose a specific user variable for a premium rather than relying on the user variable associated with the Pay Component.

Prorated

If the toggle is ON, the premium paid will be prorated based on the employee’s FTE value. This is not applicable to Premium Calc rules that include time in the formula, as actual time worked is already included in those calculations.

Example: A company pays for employees’ fitness memberships; a yearly amount of $400.00. All employees may sign up for the benefit, but part-time employees receive a pro-rated amount based on their Full Time Equivalency (FTE). As well, the company would like to pay the premium at the beginning of each month. The ISPM form would be set up as follows:

Premium Rate	400
Rate Basis	YR
Premium Calc Rule	Flat Per Period
Frequency	Monthly (See notes on Frequency above)
Premium Prorated	check (on)

In this manner, an employee with an FTE value of 0.5 would receive $16.67 /month ($200/yr).

Replacement Option

If the toggle is ON, the hours and/or earnings will be replaced by the new hours and/or earnings (including premium) calculated when the pay line is generated. The premium will remain attached to the pay line for audit purposes.

In theory, any number of premiums could be attached to a single pay line. If any one of these premiums invokes the ‘Replace’ option, then the hours and/or earnings generated by the original transaction will be replaced by the hours and earnings on the premium. Any other premiums will be processed based on these new hours/earnings.

Incl in Highest Rate of Day

If the toggle is ON it provides the ability to apply the highest rate of pay received on that day worked including premiums. The highest rate on a day of course cannot be determined until all transactions for a pay are available and ‘official’. Because of this, the perfect place to ‘Rate’ Pay Components with this option, is when the Pay hits the Pay Stage to be audited, so the UPAUDT function will be given the responsibility to apply the ‘Highest Rate of the Day’ feature.

Pay Components#

Time PC Code

Time PC code is the pay component code that will store the “time” result of the premium calculation. Users may wish to use this field if time is stored separately as a result of premium transactions.

An employee has worked 8 hours in one night shift. A transaction for the 8 regular hours has been entered, and a night shift premium will be applied. If the company requires that the 8 hours of premium time be recorded in a separate area for tracking reasons, a pay component may be entered in this field. Result: 8 hours regular time, 8 hours premium time

If the company requires only that 8 hours of regular time be recorded (relying on the earnings pay components to track the premium paid), leave the time pay component blank. Result: 8 hours regular time.

PPC_ID_TIME is an optional, 4-character numeric code that may be entered by the user or retrieved from the LOV. At least one of Time or Amount PC code must be entered.

Abbrev.

This field displays the abbreviated description of the Time PC Code selected above. This data for this field will default in once the Time PC Code has been selected.

Amount PC Code

Amount PC code is the pay component code that will store the “earnings” result of the premium calculation. Users may wish to use this field if the earnings from the premium are stored separately as a result of the premium transaction. This may be necessary if the cost account (or distribution code) of the premium differs from the originating transaction.

Continuing with the same example as above, this employee’s rate is $10/hr, and the premium rate is $0.50/hr. If separate areas for tracking regular earnings and premium (or shift) earnings are required and defined, the result would be:$80.00 regular earnings, $ 4.00 premium earnings

If the company requires only that the earnings be recorded in one lump sum (premiums are not tracked as a separate amount on the financial journal, or are tracked based on hours pay components, instead), the result would be:$84.00 regular earnings'

Abbrev.

This field displays the abbreviated description of the Amount PC Code selected above. The data for this field will default in once the Time PC Code has been selected.

Pay Point Type and Seq are only applicable to the “Prem per Period” and “UPTG Period Premium” calculation method and are REQUIRED if either of those methods are used.

Pay Point Type

Choose the point in the payroll cycle when the premium should be processed. Pay Points allow you to control the flow and process steps of the payroll process, and you may in this way ensure that a premium is calculated at the correct point.

Pay Point Seq

In this field, you may define the sequential order of each step taken within a pay point.