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Administrator Guide
Last Updated: 2023-06-23
Create or Edit a Successor Employer (USA)

Create or Edit a Successor Employer (USA)

Load payroll data from the predecessor company.
Security:
Set Up: Payroll (Tax Filing/W-2s) - USA
 domain in the USA Payroll functional area.
Define a relationship between companies when a company acquires or merges with another.
When using a tax filing vendor, Workday recommends that you supply the vendor with test files. Test files ensure that the vendor supports any new or modified configuration involving company relationships.
  1. Access the
    Create Company Relationship
     or
    Edit Company Relationship
     task.
    Only create 1 relationship type per company, per year.
  2. From the
    Company Relationship Type
     field, select
    Successor Employer
    .
  3. Select the
    Successor Employer Type
    . As you complete this field, consider what Workday carries over from the predecessor to the successor company for each type:
    Carried over to successor company?
    Asset Purchase - Standard
    Asset Purchase - Alternate
    Merger
    Employees.
    Yes, if employment is continuous at the time of the acquisition.
    Yes, if employment is continuous at the time of the acquisition.
    Yes, if employed by predecessor during the tax year.
    Wages in limit calculations.
    Yes
    Yes
    Yes
    Prior withholding order limit balances.
    No
    No
    Yes
    Multiple worksite reports.
    No
    Yes, for acquired employees.
    Yes, quarter-to-date, starting with the quarter the merger took place.
    W-2s and W-2 reporting.
    Employee receives a W-2 from the predecessor company and a separate W-2 from the successor company.
    If the tax authority recognizes combined tax filing, employee receives a W-2 only from the successor company.
    Yes, year-to-date.
    Once you’ve completed a payroll, you can’t modify this relationship type.
  4. As you complete the task, consider:
    Option Description
    Acquisition or Merger Date
    For information only. Doesn’t affect calculations.
    Payroll Processing Begin Date
    The date that you must enter when you set up the company relationship.
    You can enter any date, but make sure the:
    • Date is based on the year in which you want the relationship.
    • Payroll Processing Begin Date is equal to the worker's transfer date.
    • Pay date after the transfer date is within the correct year that you intend for tax reporting to report all workers under the successor company.
    • Affected workers have at least 1 pay result with a pay date:
      • After the date the worker transferred to the successor company.
      • In that year.
    Workday requires that you set 1
    Payroll Processing Begin Date
     that applies to all workers in the companies. This solution ensures that results and reporting are correct, and is regardless of different pay frequencies.
    For mergers, this date must be 2013-10-01 or later.
    The worker transfer date must be equal to the
    Payroll Processing Begin Date
    . For companies that have multiple pay groups with overlapping period dates in the relationship, Workday calculates multiple results for the worker and creates subperiods for the appropriate company.
    Example: You have 2 pay groups whose workers have a
    Transfer Effective Date
     of
    1/1/2022
    :
    • Pay Group 1 has a pay period of 12/18/2021 - 12/31/2021, paid on 1/7/2022.
    • Pay Group 2 has a pay period of 12/25/2021 - 1/7/2022, paid on 1/7/2022.
    You enter 1/1/2022 in the
    Payroll Processing Begin Date
     field. The
    Active Through End of Tax Year
     displays
    2022
    .
    Workday issues multiple gross to nets if there are multiple pay groups with start dates different from the
    Payroll Processing Begin Date
    .
    Workday recommends that you preview any impacted W-2 forms in a Sandbox Preview tenant.
    Successor Company
    The company that is acquiring employees.
    Predecessor Company
    The company from which you’re acquiring employees.
    Withholding Order Types
    Select the withholding order types to carry forward to the successor company.
    Tax Authorities Not Recognizing Combined Tax Filing and W-2 Reporting
    Available only for these successor employer types:
    • Asset Purchase - Alternate
    • Merger
You've established a relationship between companies, enabling payroll processing according to the type you selected.
Administrative results display values from the current company only.
You can use the
Delete Successor Employer
 task as long as there are no payroll results on or after the
Payroll Processing Begin Date
.
Global Modern Services is the successor company for Green Planet Solutions. Green Planet Solutions has these pay groups:
  • USA Semimonthly Professional Corporate is semimonthly with these periods:
    • 2020-01-01 to 2020-01-15
    • 2020-01-16 to 2020-01-31
  • USA Biweekly with these periods:
    • 2020-01-05 to 2020-01-18
    • 2020-01-19 to 2020-02-01
The
Payroll Processing Begin Date
 is 2020-01-16, so you must transfer the workers into Global Modern Services effective 2020-01-16.
You also transfer workers in pay group USA Biweekly effective 2020-01-16. Workday creates separate gross to net results for the workers in pay group USA Biweekly, with the results:
  • 2020-01-05 to 2020-01-15 for Green Planet Solutions.
  • 2020-01-16 to 2020-01-18 for Global Modern Services.
These reports display balances from the predecessor company for the
Asset Purchase - Alternates
 and
Mergers
 successor employer types:
  • Tax Filing Periodic Data by Company
  • Tax Filing Periodic for Workers
  • Tax Filing Monthly Data for Workers
  • Tax Filing Quarterly Data by Company
  • Tax Filing Quarterly for Workers
These web services are also available:
  • Get Periodic Company Tax Filing Data
  • Get Periodic Worker Tax Filing Data
  • Get Monthly Worker Tax Filing Data
  • Get Quarterly Worker Tax Filing Data
(Optional) You can copy worker tax elections from the predecessor or add them manually.
(Optional) You can copy income withholding orders (IWOs) from the predecessor or add them manually.