How can I manage Maternity Leave Payments for Salaried Employees?
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Maternity Leave for Salaried Employees
This feature allows you to define the rate at which salaried employees on Maternity leave are paid, within a particular pay group and company. The employee's pay rate is used to calculate the specific amount that is paid to employee when they are on maternity leave. Cycle changes will generate in the relevant pay cycle when the leave transaction is entered for the employee.
Assumptions:
- The Maternity Leave Type is created.
- Maternity Leave has been recalculated and all relevant employees have their maternity entitlement.
How it works?
- Ensure the employee is flagged as a NON-SHIFT Worker in their Employee Profile. Navigation: Personnel>>Personnel>>Employees
- Ensure you do not have a Maternity Leave Payroll link already entered in the Leave-Payroll Link screen. If you do have a Maternity Leave record there, please DELETE it.
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Setup TWO (2) Payroll Earning codes for Maternity. Click on the link for the guide on How to create a Payroll Earning Code?
- Maternity Leave Pay - this code reflects the amount the employee receives while on Maternity Leave.
- Maternity Salary Adjustment - this code reflects by how much the employee's REGULAR salary will be adjusted to accommodate the Maternity Leave Payment.
- If you do have a Maternity Leave record in the Leave-Payroll Link screen, please DELETE it.
- Using the codes defined for the Maternity earning, set up a Maternity Leave for Salaried Employees ONLY link
- Enter the employee’s Maternity leave record.
- Maternity Leave Payroll Process ( Repeat for each cycle that the employee is on Maternity Leave)
- Go to Cycle Changes and click on Import HR Data. Two cycle changes will be generated for the employee.
- Run the Payroll.
- Review the Maternity payment for Each Cycle that the employee is on Maternity Leave as explained in the examples below.
Step 1: Flag Employee as Non-Shift on their Employee Profile
Step 2: Ensure there is No Maternity Leave Payroll link already entered in the Leave-Payroll Link screen
Step 3: Create Two Maternity Earning Codes and Link to the Company
Step 4: Set up the Maternity Leave for Salaried Employees ONLY Link
Company and Pay Group Details
Company Code: Select the the company for which the link applies.
Pay Group: Select the pay group for which the link applies.
Link Details
Leave Code: Select the leave code representing maternity leave which has to be paid.
Earn Code: Select the payroll earning code under which the maternity leave pay will be made.
Regular Adjusted Earning Code: Select the the payroll earning code under which the REG pay adjustment will be made.
N.B. This code cannot be the same as the Earn Code (in (4)) and cannot be the same as the REG code. (detailed in Prerequisite Step 3).
Payment Rules
Note that the payment rules for the payment of maternity leave is different for each country. The example shown above is based on the laws of Trinidad and Tobago as at January 2022.
Limit Full Pay To … Days: Enter the number of days to which Full Pay will be applied. In the example above, the employee will be paid at a factor of 1 ( Full pay) for the first 30 days of their Maternity Leave.
Apply First Factor of…To…Days: Enter the factor to be applied to the next grouping of days as per the law of the country to which the company belongs. In the example above, the next 68 days of Maternity Leave is to be paid at a factor of 0.5.
Apply 2nd Factor of … To …Days: Enter the factor to be applied to the next grouping of days as per the law of the country to which the company belongs. In the example above, the factor is zero (0) and the days to be applied is zero (0). This is because in Trinidad and Tobago, Maternity is limited to 98 days and there are two payment bands, full pay and half pay. Therefore, no additional configuration is required, hence the zero values.
Apply 3rd Factor of … To …Days: Enter the factor to be applied to the next grouping of days as per the law of the country to which the company belongs. In the example above, the factor is zero (0) and the days to be applied is zero (0). This is because in Trinidad and Tobago, Maternity is limited to 98 days and there are two payment bands, full pay and half pay. Therefore, no additional configuration is required, hence the zero values.
Prorate Using: Select if pro-ration takes place via calendar days or week days for the pay group used. In the case of Maternity, Calendar days must be selected.
Status: ACTIVE…Inactive: Flag as Active for the rule to take effect when a Maternity Leave transaction is entered.
Click on the diskette to save the record.
Step 5: Enter the Maternity Leave Transaction for the Employee via the Leave Module OR Employee Self Service module
In the example above the employee is going on Maternity leave for 98 calendar days from the 10th September, 2018 and is expected to return on the 17th December, 2018.
Maternity Pay for Cycles 9 through 12
View Imported Cycle Changes
Search for the relevant cycle - in this example it is cycle 9 of the monthly Pay Group since the employee's maternity leave began in September (9th month of the year).
Step 6: Go to Cycle Changes and click on Import HR Data for the respective cycle (Cycle 9)
APPROVE AND RUN THE PAYROLL FOR CYCLE 9
Calculations for Cycle 9
Maternity Leave Start Date: 10th September, 2018 (Cycle 9)
Number of Maternity Leave Days: 98 Calendar Days
Pay Group: Monthly
Monthly Salary: $4500.00
Maternity Leave Policy: First 30 days is paid at full pay and the remaining 68 days is paid at half pay
Maternity Leave Dates = 10th September 2018 - 17th December 2018
Days being processed this cycle 21 days ( September 10th = 30th)
Number of Days into Maternity Leave September 10th is the first day of Maternity Leave. Therefore the 21 days in September are to be paid at Full pay as per the maternity rules.
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#1 = Basic Salary- This is the pay rate for the employee.
- Number of Days to be paid Basic Salary = 9 Days of Basic Salary (1st Sep - 9th Sep as the employee's Maternity leave did not start until 10th Sep.)
- Amount paid outside of Maternity at Basic Pay rate = 9/30 * $4500.00 = $1350.00
- #2= Maternity Adjusted - This is the amount that the regular pay will be adjusted by to accommodate the maternity pay.
- Amount that Basic Pay is to be adjusted by to accommodate Maternity Pay and ensure the employee is not overpaid = - $3150 .
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#3 - Maternity Pay- This is what the employee is being paid for Maternity pay for this cycle.
- Number of Days at Full Pay in September = 21 Days at full pay as per maternity payment rules ( 10th Sept - 30th Sep 2018)
- Maternity Pay = 21/30 * $4500.00 = $3150
Total Salary = (Basic ( $4,500.00) - Maternity Adjusted ($3150.00)) + Maternity Pay ($3150.00) = $1350.00 + $3150.00 = $4500.00
Next Steps:
- Archive cycle 9
- Import HR Data for Cycle 10
- Approve and run Cycle 10
Import HR Data for Cycle 10
APPROVE AND RUN THE PAYROLL FOR CYCLE 10
Maternity Pay for Cycle 10
Calculation for cycle 10:
Maternity Leave Start Date: 10th September, 2018 (Cycle 9)
Number of Maternity Leave Days: 98 Calendar Days
Pay Group: Monthly
Monthly Salary: $4500.00
Maternity Leave Policy: First 30 days is paid at full pay and the remaining 68 days is paid at half pay
Maternity Leave Dates 10th September 2018 - 17th December 2010
Days being processed this cycle 31 days ( October 1st - 31st, 2018)
Number of Days into Maternity Leave Oct. 1st is the 22nd day of Maternity Leave. Therefore 9 days are to be paid at Full pay and the rest at half pay as per the maternity rules which states the first 30 days at Full Pay and the next 68 days at half pay.
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#1 = Basic Salary - This is the pay rate for the employee.
- Number of Days to be paid Basic Salary = 0 Days of Basic Salary
- Amount paid outside of Maternity at Basic Pay rate = 0/31 * $4500.00 = 0
- NB: The employee is on Maternity Leave for the ENTIRE month of October, therefore there will be no 'Basic Salary' amount.
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#2= Maternity Adjusted - This is the amount that the regular pay will be adjusted by to accommodate the maternity pay.
- Amount that Basic Pay is to be adjusted by to accommodate Maternity Pay and ensure the employee is not overpaid = - $4500
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#3 - Maternity Pay - This is what the employee is being paid for Maternity pay for this cycle.
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Number of Days at Full Pay in October = 9 Days at full pay ( 1st - 9th October 2018) as 21 days were already paid in full ( Sep. 10th - 30th 2018) and according to the rule ONLY 30 days are to be paid at Full pay.
- Full Pay = 9/31 * 4500 = $1306.45
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Number of Days at Half Pay in October = 31 days in October - 9 Days at at full pay = 22 Days
- Half Pay = 22/31 * (4500/2) = 22/31 * 2250 = $1596.77
- Total Maternity Pay = $1306.45 + $1596.78 = $2903.23
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Number of Days at Full Pay in October = 9 Days at full pay ( 1st - 9th October 2018) as 21 days were already paid in full ( Sep. 10th - 30th 2018) and according to the rule ONLY 30 days are to be paid at Full pay.
Total Salary = (Basic ( $4,500.00) - Maternity Adjusted ($4500)) + Maternity Pay ($2903.22) = 0+ $2903.22 = $2903.23
Next Steps:
- Archive cycle 10
- Import HR Data for Cycle 11
- Approve and run Cycle 11
Import HR Data for Cycle 11
APPROVE AND RUN THE PAYROLL FOR CYCLE 11
Maternity Pay for Cycle 11
Calculation for cycle 11:
Maternity Leave Start Date: 10th September, 2018 (Cycle 9)
Number of Maternity Leave Days: 98 Calendar Days
Pay Group: Monthly
Monthly Salary: $4500.00
Maternity Leave Policy: First 30 days is paid at full pay and the remaining 68 days is paid at half pay
Maternity Leave Dates 10th September 2018 - 17th December 2018
Days being processed this cycle 30 days ( November 1st - 30th, 2018)
Number of Days into Maternity Leave Nov 1st is the 53rd day of Maternity Leave. Therefore ALL days are to be paid at Half pay as per the Maternity Payment rules which states the first 30 days at Full Pay and the next 68 days at half pay.
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#1 = Basic Salary - This is the pay rate for the employee.
- Number of Days to be paid Basic Salary = 0 Days of Basic Salary
- Amount paid outside of Maternity at Basic Pay rate = 0/30 * $4500.00 = 0
- NB: The employee is on Maternity Leave for the ENTIRE month of November, therefore there will be no 'Basic Salary' amount which is why the Maternity Adjustment amount is - $4,500.00 which zeros out the Basic Salary'
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#2= Maternity Adjusted - This is the amount that the regular pay will be adjusted by to accommodate the maternity pay.
- Amount that Basic Pay is to be adjusted by to accommodate Maternity Pay and ensure the employee is not overpaid = - $4500
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#3 - Maternity Pay - This is what the employee is being paid for Maternity pay for this cycle.
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Number of Days at Half Pay in November = 30 days
- Half Pay = 30/30 * (4500/2) = 1 * 2250 = $2250.00
- Total Maternity Pay = $2250.00
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Number of Days at Half Pay in November = 30 days
Total Salary = (Basic ( $4,500.00) - Maternity Adjusted ($4500)) + Maternity Pay ($2250.00) = 0+ $2250.00 = $2250.00
Next Steps:
- Archive cycle 11
- Import HR Data for Cycle 12
- Approve and run Cycle 12
Import HR Data for Cycle 12
APPROVE AND RUN THE PAYROLL FOR CYCLE 12
Maternity Pay for Cycle 12
Calculations for Cycle 12
Maternity Leave Start Date: 10th September, 2018 (Cycle 9)
Number of Maternity Leave Days: 98 Calendar Days
Pay Group: Monthly
Monthly Salary: $4500.00
Maternity Leave Policy: First 30 days is paid at full pay and the remaining 68 days is paid at half pay
Maternity Leave Dates = 10th September 2018 - 17th December 2018
Days being processed this cycle 16 days ( December 1st - 16th, 2018 )
Number of Days into Maternity Leave December 1st is the 81st day of Maternity Leave. Therefore ALL 16 Maternity days are to be paid at Half pay as per the Maternity Payment rules which states the first 30 days at Full Pay and the next 68 days at half pay. The rest of days in December are to be paid at the employee's normal rate, assuming that they return to work.
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#1 = Basic Salary- This is the pay rate for the employee.
- Number of Days to be paid Basic Salary = 15 Days of Basic Salary (17th - 31st December, 2018) as the employee's Maternity leave finished on the 16th of December and they were scheduled to return to work on the 17th of December,2018 .
- Amount paid outside of Maternity at Basic Pay rate = 15/31 * $4500.00 = $2177.42
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#2= Maternity Adjusted- This is the amount that the regular pay will be adjusted by to accommodate the maternity pay.
- Amount that Basic Pay is to be adjusted by to accommodate Maternity Pay and ensure the employee is not overpaid = - $2322.58 .
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#3 - Maternity Pay- This is what the employee is being paid for Maternity pay for this cycle.
- Number of Days at Half Pay in December = 16 days
- Half Pay = 16/31 * (4500/2) = 16/31 * 2250 = $1161.29
- Total Maternity Pay = $1161.29
Total Salary = (Basic ( $4,500.00) - Maternity Adjusted ($2322.58)) + Maternity Pay ($1088.71) = $2177.42 + $1161.29 = $3338.71
Note:
In the Next Cycle, the employee will not have any further Maternity Adjustments and will return to their regular basic salary for the period.
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