Configuring Time Quota Compensation in SAP ERP HCM

  • by Kory Thomas, Business & Systems Integration Analyst, Accenture
  • September 23, 2015
Gain a fundamental understanding of how employee absence quotas are paid to employees using standard SAP Time Management configuration and integration with SAP payroll. Compare two different compensation methods—quota-specific compensation and free compensation—to see an overview of the considerations that need to be taken into account when implementing this solution. Walk through the process of configuring the solution, and also learn how to test it in both SAP Time Management and payroll.
Learning Objectives

After reading this article, you will:

  • Understand the process of remunerating employee absence entitlements in SAP ERP HCM
  • Learn the configuration steps for setting up a time quota compensation method
  • Understand the difference between a quota-specific compensation method and a free compensation method, and the pros and cons of each
  • Understand how SAP time quota compensation is integrated with SAP payroll
  • Learn how to validate the results of your time quota compensation configuration
Key Concept

Time quota compensation is the remuneration of the remaining balance of employee leave entitlements. While this is typically paid at a rate of 100 percent, meaning that employees receive their regular rate of pay for each hour that is remunerated, this is not always the case based on company policy.

There are a number of situations in which companies need to provide monetary compensation to employees for their remaining leave entitlements. This compensation may come at the end of their employment, at the end of the year, or at the employee’s discretion depending on the legal regulations or terms of a collective bargaining agreement. For these situations SAP has provided a standard method of compensating leave entitlements that is both highly flexible and directly integrated with SAP payroll.

I show the necessary steps for designing, building, and testing a time quota compensation solution that is applicable to your company’s requirements. I cover each required configuration task using two different compensation methods. I also show how to configure and understand time-quota compensation as it relates to SAP time and payroll. Although the example used is compensating vacation entitlement, this set of configuration steps can be applied to any sort of leave entitlement.

In order to perform time quota compensation, a number of configuration items need to be in place. You need a configured absence type, absence quota, counting rule, and deduction rule.

Step 1. Define Time Quota Compensation Method

In this step, define the time quota compensation method and choose the employee subgroups and personnel subareas to which the method is applicable. The configuration that is maintained in this step defines the method that you select when creating the infotype 0416 (time quota compensation) record. Follow IMG menu path Time Management > Time Data Recording and Administration > Managing Time Accounts Using Attendance/Absence Quotas > Time Quota Compensation > Define Time Quota Compensation Methods.

Kory Thomas

Kory Thomas is currently an Atlanta-based SAP HCM consultant at Accenture, working primarily in the automotive, industrial, infrastructure, and transportation industries. He has worked in the SAP ERP HCM space for over three years, focusing on the Organizational Management, Personnel Administration, and Time Management modules as well as ESS/MSS.

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