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Administrator Guide
Last Updated: 2023-06-23
Steps: Set Up Flexible Payment and Deduction Options

Steps: Set Up Flexible Payment and Deduction Options

Review setup considerations for flexible payment and deduction options.
You can set up the
Request Flexible Payment and Deduction Options
 business process, enabling workers to:
  • Request loans, advances, or other payments that they can repay with future payroll deductions. Example: A 500 loan, repaid in 5 deductions of 100 each.
  • Set goal or target amounts that Workday deducts from their payroll. Example: A charitable donation of 50, deducted in the next 2 pay periods.
When you configure the business process, Workday enables payroll administrators to record flexible payment and deduction requests for workers and to correct goal or target amounts for them.
  1. Edit the
    Request Flexible Payment and Deduction Options
     business process security policy in the Core Payroll functional area to grant security groups request, record, and other permissions.
  2. Create the
    Request Flexible Payment and Deduction Options
     business process default definition.
    • In the
      Group
       column of step
      b
      , select the security groups that will review and approve requests.
    • Optional: Add document steps to the business process. We recommend adding the Review Document step after the Request Approval step.
    • Note: We don't recommend that you add any other steps to the
      Request Flexible Payment and Deduction Options
       business process. Limiting the selection to the recommended steps helps you to avoid data quality issues.
  3. Create earnings for payments to workers and negative earnings that Workday deducts from workers' pay. As you complete the task, consider:
    Option Description
    Worker Eligibility
    • When creating an earning, select
      Flexible Payment Amount > 0
      .
    • When creating a negative earning, select
      Flexible Deduction Amount < > 0
      .
    Calculation
    • When creating an earning, select
      Flexible Payment Amount
      .
    • When creating a negative earning, select
      Flexible Deduction Amount
      .
    Input Amount Allowed?
    To enable you to enter the calculation amount through payroll input, select the check box.
    Calculation Proration
    Workday doesn't prorate flexible payment and deduction amounts. Select
    None of the above
    .
    Do Not Recalculate During Retro
    Workday doesn't support retroactive flexible payments. Select the check box.
    Calculation Worktag
    Workday supports payments and deductions only to the worker's primary position. Select
    Position
    .
  4. Create deductions for repayments and flexible deductions. As you complete the task, consider:
    Option Description
    Worker Eligibility
    Flexible Deduction Amount < > 0
    .
    Calculation
    Flexible Deduction Amount.
    If you're setting up a deduction to recoup an outstanding balance on termination, use a conditional calculation with the
    Flexible Payment – Outstanding Balance
     IVC.
    Input Amount Allowed?
    To enable you to enter the calculation amount through payroll input, select the check box.
    Recalculate during Retro
    Workday doesn't support retroactive flexible deductions. Clear the check box.
    Calculation Worktag
    Workday supports flexible payments and deductions only to the worker's primary position. Select
    Position
    .
  5. Access the
    Maintain Flexible Payment and Deduction Options
     task.
    As you create the types of payments and deductions that workers can request, consider:
    Option Description
    Payment/Deduction Type
    Enter the name of the payment or deduction type.
    Earning
    Select the earning for payments to workers.
    For a goal or target amount with no payment to the worker (Example: charitable contributions), don't select an earning.
    Deduction
    Select the deduction or negative earning used for repayments from workers or contributions toward a goal or target amount.
    Request Between
    Enter the date range that the payment and deduction type is available for workers to request. When you leave these fields blank, the request is always available.
    Effective Between
    Enter the date range for the payment to the worker. When you leave these fields blank, payment can occur in any period.
    Number of Installments
    Enter the number of pay periods for a worker's loan, goal, or target amount. Enter zero in the
    Maximum
     field for no limits.
    Allow Only One Active Request
    To prevent workers from requesting a pre-existing request type, select the check box.
    Allow Target Amount To Be Corrected
    To enable you to correct the goal or target amount for a flexible deduction, select the check box.
    Security:
    Set Up: Payroll (Flexible Payments and Deduction Options)
     domain in the Core Payroll functional area.
  6. (Optional) Define Deduction Priorities and Arrears Handling for the flexible deductions. As you complete the task, consider:
    Option Description
    Priority Order
    Assign the lowest priority to flexible deductions so that higher-priority deductions don't go into arrears.
    Track Arrears
    Recoup Arrears
    Workday doesn't support arrears on flexible payments and deductions. Don't select these check boxes.
  7. Add the
    Request Flexible Payment and Deduction Options
     task and the
    My Flexible Payment and Deduction Options
     report to the
    Pay
     dashboard.
  8. (Optional) Set Up Worklets.
    Add the
    Request Flexible Payment and Deduction Options
     task to the
    Pay
     or
    Benefits
     worklet.
After a worker requests a flexible payment or deduction, the business process routes the request for review.
Workday stores the granted amount and the deduction amount on each request. It doesn't store the number of installments, which can change when:
  • You edit the granted or deduction amount.
  • The worker skips 1 or more scheduled payments.
When a payroll administrator or other user records a flexible payment or deduction request on behalf of a worker, Workday automatically approves the request.
Workday assigns each request a unique payment or deduction type ID. The ID displays on the
View Flexible Payments and Deductions
 report. Use it as a payroll worktag to identify the transaction when you:
  • Adjust the request through payroll input.
  • Pay the request before the regular payroll date with an on-demand payment.
  • Use web services to process requests.