Using Personal Data Fields to Calculate Payroll Decisions

  • by Irfan Malik, Senior SAP HCM Consultant, IBM Global Business Services
  • December 23, 2011
Discover the standard payroll operations and functions provided by SAP ERP HCM that enable users to query the age and gender of employees. Also learn how to calculate date differences from date of birth to the current payroll period.
Key Concept
Data fields in infotype 0002 (personal data) can influence payroll processing. For example, the title of an employee determines the employee gender in the SAP ERP HCM system. You can use the date of birth field to calculate a date differences (i.e., the age of an employee up to the current payroll period) or use the hiring date (infotype 0000) to determine the seniority of an employee in an organization in terms of number of days, months, or years. I show how you can use data fields from infotype 0002 (personal data —i.e., date of birth or gender) in personnel calculation rules to meet these types of payroll requirements.

Among the most common challenges that users face during SAP payroll implementations are the many nonstandard requirements that vary from company to company and country to country.  

For example, in the US employment discrimination on the basis of gender is prohibited by a collection of state and federal laws, as well as by ordinances of counties and municipalities. However, in some countries payroll decisions are still made on the basis of age or gender. Female employees in some countries may be given income tax relief solely because of their gender. In other organizations a conveyance allowance is given to male employees since they are not provided with transportation to and from work, as female employees are.

There can be a difference in income tax rates for males and females (the bracket of minimum and maximum income amounts used to match employees’ salaries for tax purposes, known as slab tax rates). In some countries there is a legal requirement that employees from age 65 on get a personal allowance that allows them to save tax-free income each year. In other companies, a seniority allowance is paid to employees as a reward for long service.

In addition to these nonstandard requirements, users need to focus on the fundamental processing part of the payroll system (i.e., the date specifications of an employee when a business decision must be made on the basis of an employee’s gender, age, or date of hire).

First, the following quick overview of payroll schemas and personnel calculation rules (PCRs) shows why you need them and how to affect payroll processing with custom logic. By using these simple techniques when implementing SAP payroll, SAP ERP HCM system users can avoid ABAP developments and enhancements, and increase efficiency and accuracy in payroll.

Irfan Malik

(Muhammad) Irfan Malik is a senior managing consultant at IBM Global Business Services in Pakistan and has been working as an SAP HR consultant for many years. He has consulted for various global, public, and private companies on their SAP HR core modules including Payroll and Time Management implementations.

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