Setup Considerations: FLSA Company Relationships (USA)

You can set up FLSA company relationships for workers with multiple jobs across different companies to calculate:

FLSA blended overtime premium.
Flat Sum bonus overtime premium rate.

When you create an FLSA company relationship, to calculate FLSA blended overtime premium, Workday:

Applies it to all FLSA overtime calculations for eligible employees.
Aggregates the hours and wages of workers across 2 or more companies within the FLSA company relationship.

When you create an FLSA company relationship, to calculate Flat Sum Bonus overtime premium rate, Workday:

Applies it to all Flat Sum Bonus overtime calculations for eligible employees.
Uses all hours worked based on coverage dates across 2 or more companies within the FLSA company relationship.

Setting up an FLSA company relationship enables you to:

Save time by automatically calculating FLSA blended overtime premiums.
Easily report the hours and wages of workers across multiple companies.
Save time by automatically calculating Flat Sum Bonus overtime premium rate.
Easily report the total regular hours based on coverage dates.
Reduce your manual effort and the need for manual calculations.

Questions	Considerations
How do you set up FLSA company relationships?	You can use the Create FLSA Company Relationship task.
How does Workday pay overtime adjustments (FLSA)?	Workday calculates the overtime adjustments on the last processed gross-to-net. The company that caused the adjustment pays the overtime adjustment. Use the intercompany accounting functionality to charge the overtime to the desired company. There are no changes to how Workday allocates bonus and applies the proration rules.
How does Workday pay a prior period bonus (FLSA)?	When the workers' jobs are in unique companies and the companies: Are in an FLSA relationship, the overtime adjustments such as bonus is paid on the last gross-to-net of all the companies within the relationship. Aren’t in an FLSA relationship, the overtime adjustments are calculated independently for each company.
How does Workday pay the bonus across multiple companies when a worker moves companies (FLSA and Flat Sum Bonus)?	For FLSA: Workday pays the bonus and adjusts overtime to the current company. Since the worker is terminated in the prior company, use retro or prior period on-demand additional processing, when you need to pay a bonus back to the prior company. If you pay an FLSA bonus with coverage dates that crosses companies, Workday pays the bonus and adjusts overtime to the current company regardless if the company is an FLSA relationship or not. For Flat Sum Bonus: Workday calculates the Flat Sum Bonus premium rate for all hours within the bonus coverage period within the FLSA relationship. For companies that aren't in a company relationship: If the bonus coverage dates are in the previous company, Workday doesn't calculate the Flat Sum Bonus premium rate. Use prior period on-demand additional payment or retro targeting the previous company to pay the Flat Sum Bonus premium rate If the bonus coverage dates are in targeting both the previous and current or only the current company; Workday calculates only the overtime Flat Sum Bonus premium rate for the current company

Workday recommends that you enable payroll intercompany accounting to support FLSA company relationships. Make sure you:

Include all companies within an FLSA Company Relationship on the intercompany profile.
Set up payroll ledgers for each company for all configured operational transaction types.
Open ledger periods for all configured operational transaction types for the period end date or in the future.
Review cost center and company restrictions to ensure they're within the related companies and have valid operational transactions and worktag balancing rule configurations.
Review, add, or update a worker's assigned costing.

Workday recommends you not to do reversals for workers with an FLSA adjustment or for workers with multiple jobs and companies. If you do so, you'd need to manually make adjustments going forward for the worker for that period.

To calculate FLSA blended overtime or Flat Sum Bonus overtime premium rate accurately, you must:

Set up FLSA work period calendar rules. Companies must be in the same FLSA work period calendar and FLSA work period calendar rule.
Create an FLSA company relationship.
Have the same pay frequency (pay period start/end and check date) for each company in the FLSA company relationship.
Have all companies in the same pay group.
Have the same run category for regular pay.
Use position-based earnings for regular and overtime hours.

Workday doesn't support future coverage dates.

Workday aggregates all the hours and wages for nonexempt employees of all companies involved in the Single Legal Entity or Common Paymaster company relationship. An FLSA Company relationship isn’t needed. Therefore, there could be an FLSA overtime adjustment for a different company on your current company payroll result. Workday recommends that you enable payroll intercompany accounting. You can disable the automatic FLSA overtime premium calculation to aggregate across companies by selecting the

Disable Company Tax Relationships for FLSA and Flat Sum Bonus

check box on the

Edit Tenant Setup-Payroll

task.

Users with security enabled for the

Set Up: Payroll (FLSA) - USA

domain in the USA Payroll functional area can set up FLSA company relationships.

No impact

You can run the

View FLSA Company Relationship

report to verify the FLSA company relationships you've set up.

You can use these web services to update FLSA company relationships:

Get FLSA Company Relationships
Put FLSA Company Relationship

Workday offers a Touchpoints Kit with resources to help you understand configuration relationships in your tenant. Learn more about the Workday Touchpoints Kit on Workday Community.