Framework Configuration

Overview

Objectives

Enable a tenant for payroll.
Generate period schedules.
Define gross and net pay accumulations.
Create run categories.
Define payment election rules.
Create pay groups.
Assign workers to pay groups.
List payroll-specific business processes.
Describe the difference between user-based and role-based security groups.

Framework Configuration

Tenant Setup – Payroll

Before configuring the payroll processing framework, access the

Edit Tenant Setup - Payroll

task to enable the tenant-wide settings for payroll, which includes:

Selecting countries that will use Workday Payroll.
Enabling continuous calculation.
Specifying the lookback period for retro calculations.
Selecting ID sequence definition for withholding orders.
Enabling payslip options, including the option to print multiple payslips.
Enabling costing allocations.
Specifying payroll accounting options.

Resource

: For details on each tenant setup option for payroll, search the Workday Administrator Guide for the

Edit Tenant Setup - Payroll

topic.

Edit Tenant Setup - HCM

Other tenant setup areas support features used by payroll. Consider the following Workday HCM tenant-wide settings.

Multiple Jobs

If workers have multiple positions, configure your tenant to support multiple jobs using the

Edit Tenant Setup - HCM

task. Specifying Multiple Jobs for your tenant enables the Position worktag on pay components.

Resource

: You can combine payslips for a worker with multiple jobs across related companies. For details, search the Workday Administrator Guide for the

Combine Payslips

topic.

Employee ID

To display an employee's ID beside their name, select the Include ID in Person Name option.

Payroll Processing Framework

Period Schedule Configuration

Payment Date Optional Fields

You can use these optional fields to support the period schedule.

Regular Pay Day

determines the regular payment date reported on a worker's Statutory Compensation Statements, if needed.

Payment Date Auto-Adjust

prevents payment dates from falling on a weekend. For example: Enter -1 in the Saturday field to change payment dates that fall on a Saturday to the previous Friday. Use this option when the payment day varies, which usually occurs with semi-monthly and monthly pay frequencies.

Holiday Calendar

enables you to add holiday calendars to your period schedules so that Workday will automatically prevent payment dates to occur on a holiday. You can select only one holiday calendar at a time.

Auto-Adjust on Holidays

prevents payment dates from occurring on a holiday, as indicated on the included holiday calendar. The payment date will automatically adjust according to what has been configured in this field, either Before Holiday or After Holiday.

0 ( )

Payment Date Offset Days Default

defaults the payment date by the specified number of days before or after the period end date. Weekly and bi-weekly schedules commonly use this option.

Payment Date Offset Days Default Field

When creating a new schedule, the Payment Date Offset Days Default field does not display initially. To set up a payment date offset:

Save the period schedule.
From the period schedule name, select the Related Action Period Schedule > Edit.
Expand the Payroll section.
Change the Payment Date Offset Days Default.
Continue to build the period schedule.

Continuous Payroll Calculation

If your organization has enabled continuous calculation in the

Edit Tenant Setup - Payroll

task, a continuous calculation option displays in the period schedule. This option enables the initial calculation of each pay period to calculate automatically.

When you enable continuous calculation in your tenant, your period schedules display additional options.

Enable these options in your period schedules to establish a start and stop time for the continuous calculation. For example, you can have calculations begin on the period start date, and stop a few days before the period end date so that you can perform final audits.

You can configure the types of pay-impacting events processed by both continuous calculation and smart calculation with the

Configure Smart Calculation Event Processing

task.

Once configured, you can manage continuous payroll calculation with these reports:

Update Continuous Payroll Calculation Status
report to review the current status or to pause the continuous calculation when you are ready to audit.
Continuous Payroll Calculation Pipeline
report to view a snapshot of the payroll-impacting events that have been entered in Workday, but not yet calculated.

Continuous calculation is not enabled in your training tenant. You will process all calculations manually during training.

Resource

: For more information on the continuous calculation feature, search Workday Community for: Setup Considerations: Continuous Payroll Calculation

Pay On-Demand

Pay on-demand is an optional configuration that provides employees an ability to access a portion of their earned wages prior to the payment date. You can define rules related to the number of payments, taxation, settlement, and approvals.

The period schedule is used to determine:

When workers can request pay on-demand.
How to adjust the payment date for weekends.

Resource

: For setup considerations and tasks to configure Pay On-Demand options, review the following topic in the Workday Administrator Guide:

Steps: Setup Pay On-Demand

Payroll General Ledger (GL) Accruals

Accruals in accounting allow you to keep assets and liabilities in the financial reporting periods where they belong. You can use payroll GL accruals in your period schedules to estimate payroll payments in a future pay period that spans two financial reporting periods.

Workday creates the forward accrual as a ratio. The estimated number of days in the pay period (days to accrue) is divided by the days in a full financial accounting period (days in basis). You create a forward accrual on a specified accrual date and reverse it on a specified accrual reversal date.

Days to Accrue:
The number of days for which you are estimating payroll costs.
Days in Basis:
The number of work or calendar days in a full financial reporting period.
Accrual Date:
The date of the accounting entry.
Accrual Reversal Date:
Any day after the accrual date.

The following diagram illustrates how Workday uses one week of payroll actuals as the basis for estimating payroll costs in the next period. The second period has three days that precede the accounting period end date. Workday calculates the forward accrual as follows:

Days in Basis = 5, based on work days. You can use work days or calendar days.
Days to Accrue = 3.
3/5 represents portion of basis to project forward as cost estimate.

Tip

: You can exclude specific expenses from forward accruals using the

Maintain Payroll Accounting Options

task. You can identify what pay components are excluded by viewing the

All Deductions

and

All Earnings

reports. Scroll to the right to view the Exclude from Forward Accruals column.

Run Category Configuration

What workers to process, based on status or other selection criteria.
Taxation and processing rules, including minimum net pay amount (for net pay validations).
Which pay components to process, including which to process automatically for terminated workers, workers on leave, and when making off-cycle payments.

Nonactive (On Cycle, On Demand Replacement) Tab

This tab controls the pay components to process for nonactive workers, such as terminated workers and workers on leave. These workers should also meet the selection criteria defined on the General tab. You can process payroll for nonactive workers with either a payroll run (on-cycle) or an on-demand replacement payment (off-cycle).

Rules you define for paying nonactive workers in on-cycle pay runs apply to jobs in the same pay group as a worker's primary job.
The on-demand replacement payment replaces the on-cycle payroll payment. Use on-demand replacement payments when you need to pay a worker before the on-cycle payroll is complete. For example, when a worker is terminated mid period and needs final payment upon termination.

Use the Nonactive tab to specify what pay components to calculate based on specific statuses for workers who have already passed the criteria specified on the General tab. For example, for special disability payments with workers on certain leave of absence types, use this page. This option ties the pay component or pay component groups to the leave type that receives that payment.

Note

: Only leave types with the Payroll Effect option enabled are available for selection.

View Run Category - Nonactive Tab

Workday always calculates statutory taxes (employer and employee) for on-cycle and on-demand replacement payments. For the selected nonactive workers who meet pay component eligibility, it also calculates:

One-time payroll input for the period and one-time or bonus payments from Workday Compensation during on-cycle processing. To process on-going payroll input, select the pay component on the Nonactive tab.
One-time or bonus payments from Workday Compensation in on-demand replacement payments. To process one-time or ongoing payroll input, select the pay components on the Input grid in the
Run On Demand Payment for Worker
task.

Review the Nonactive (On cycle, On Demand Replacement) tab fields in the following table.

Field	Value
Pay Components To Calculate	The pay component must belong to the gross, net, or additional pay components specified on the General tab.
Pay Component Groups To Calculate	The pay component group must belong to the gross, net, or additional pay components groups specified on the General tab, such as Employer Paid Benefits. If you frequently process the same set of deductions for additional payments, you can create a pay component group and assign it to multiple run categories.
Status	Specify whether to calculate the component for Terminated or On-Leave employees. The combination of pay component (or pay component group) and status must be unique.
Leave Types	When the status is On Leave, select the leave types for which to calculate the pay component. Only leave types with the Payroll Effect option enabled are available for selection. To calculate the pay component for all leave types that have the Payroll Effect option enabled, skip this field.
Processing Criteria	Define criteria for calculating the pay component or pay component group. All criteria in the same row must be met. If you define criteria in separate rows (using OR logic), criteria in at least one row must be met. If you do not define processing criteria for a status, Workday processes the pay component for all workers with that status. Workday provides many calculations you can use as processing criteria. However, some are too broad to use as processing criteria. Payroll Input Exists for an Earning that is Part of Gross Pay Accumulation for the Run Category is an example.

Off Cycle (On Demand Additional, Manual) Tab

This tab lists pay components that calculate automatically for additional on-demand payments and manual payments. For instance, Workday will not automatically calculate employee retirement plan contributions on an on-demand additional payment, unless listed on this tab.

View Run Category - Off Cycle Tab

Example

: You will review examples of off-cycle payments later in the course.

Review the fields on the Off Cycle tab in the table below.

Fields	Description
Pay Components To Calculate	The pay components included on this tab must belong to the gross, net, or additional pay components specified on the General tab.
Pay Component Groups To Calculate	Select a grouping of earnings or deductions to calculate. Tip : If you always process the same set of deductions for workers on leave, consider creating a pay component group for this purpose. You can assign the same pay component group to multiple run categories.
Type Of Run	The type of additional off-cycle payments the instructions apply to: Manual Payments or On Demand Payments.
Off-Cycle Reasons	You can select the reasons listed here when you run on-demand pay calculations. This allows you to resolve the pay component for payments made for specific reasons. These reasons are tenant-specific.
Status	The status of employees for whom to calculate the pay component or pay component group: Active, Terminated or On Leave. The combination of pay component and status must be unique.
Leave Types	When the status is On Leave, select to which leave types the pay component applies. Only leave types with the Payroll Effect option enabled are available for selection.
Processing Criteria	Define criteria for calculating the pay component or pay component group. Workers must meet these criteria in addition to the pay component eligibility requirements defined with the Create Earning or Create Deduction task (Criteria tab). All criteria specified in the same row must be met. If you define criteria in separate rows (OR logic), criteria in at least one row must be met.

Pay Accumulations

A pay accumulation is a set of earnings, deductions, pay component-related calculations, pay component groups, or other pay accumulations for which Workday can calculate a total. You specify which values add to or subtract from the pay accumulation.

Use accumulations to:

Sum the value of a group of earnings, deductions, pay component-related calculations, pay component groups, or other pay accumulations.
Add the value of some payroll elements to the total pay accumulation value while subtracting the values of others.

Workday delivers several predefined pay accumulations, such as:

Federal Taxable Wages by Company
Local Withholding Subject Wages by Company
EI Wages by Company
Gross Wages (T4) by Company/Province
GBR Gross
GBR Net

When defining run categories, remember that Gross and Net pay are specific types of accumulations.

Reminder

: All run categories must be associated with Gross and Net pay accumulations.

Pay Component Groups

Like pay accumulations, pay component groups (PCGs) play an important role in the definition of run categories. A PCG is a set of related earnings, deductions, and pay component-related calculations that return an aggregate value for use in payroll calculations and reports.

Workday uses pay component groups for calculations and reporting. Workday delivers pay component groups for deductions, such as for taxes and withholding orders, and others for earnings, such as Adds to Gross and Employer Paid Benefits. You can also create your own PCGs to facilitate calculations.

When you create new earnings, deductions, or pay component-related calculations, remember to add them to the appropriate PCGs. Associate additional pay components or pay component groups with a run category to calculate the value of earnings/deductions that:

Do not reduce gross pay.
Are calculated for or in relation to the employee.

Additional Pay Component Groups to Calculate

Pay Group Configuration

Workday uses pay groups to group workers for payroll processing. Consider the following: They are an organization type that is unique to payroll. They are associated with one country. Members can belong to different divisions, departments, companies, and supervisory organizations. Members share period schedules and run categories. Workers can only be assigned to one pay group unless using multiple job functionality.

Pay Run Groups

Pay run groups are an optional convenience feature. A pay run group associates a set of pay groups with selected run categories. You can process and run reports on them together. When you calculate payroll or run reports, you can select the pay run group rather than the individual pay groups. You can also complete all pay groups within the same pay run group at once, saving time. Pay run groups must share a period schedule and be in the same country.

Business Process Framework

The Workday business process framework defines and deploys business processes to suit the way a company works. You choose the tasks that compose a business process, and the completion order. While you cannot create brand new business processes, you can create different versions of the same business process for different organizations. You can define custom business processes for any supervisory organization. The business process logic is inherited. Therefore, subordinate organizations automatically use a business process defined for a superior organization, unless the subordinate organization has its own definition of the process.

The business process framework uses security groups to control who performs the tasks with a business process event. Tasks are associated with specific roles, not specific people, therefore, workers can move in and out of roles without disrupting the business process logic.

Business process definitions determine:

You create business processes using a combination of actions, approvals, approval chains, to-dos, and checklists. An action can be a single task or it can be a subprocess, which is also a combination of actions, to-dos, and checklists. Within the process, you can define conditions that determine if the business process initiates a step. You can also define notifications to notify a Workday user of the process status.

Pay Group Assignment and the Hire Business Process

You can assign workers to pay groups using several methods.

Manual pay group assignment.
Assign Pay Group
is a standalone business process that allows you to manually assign the pay group to a worker. You can also use this process to assign the pay group to worker and position if using Multiple Job functionality.
Subprocess of a staffing transaction.
Assign Pay Group
business process as a subprocess to a staffing transaction.
Automatic pay group assignment.
Note
: You can assign one active pay group rule per pay group. In other words, five pay groups require five rules. A best practice is to define a pay group automatic assignment rule when you create the pay group. For details, see Workday Community.
Mass load pay group assignments.
You can assign or change pay groups for multiple workers in cases such as promotions, reorganizations, or mergers and acquisitions using the EIB
Assign Pay Group
Web Service.

Important

: You can only assign a worker to a pay group after you assign the worker to a company. The company is the primary organization for Workday Financial Management and plays an important role for payroll, as this is the location of the tax identification number.

Resource

: Search Workday Community for more information about pay groups.

Payroll-Specific Business Processes

You can access the

Business Process Definitions

report or the

Default Business Processes

report to view payroll-specific business processes.

Some business processes, such as the Hire business process, include payroll business processes (Assign Pay Group) or impact payroll (Edit/Assign Organization).

To run payroll, you must assign workers to a company organization. Using one of the following methods:

Set up a default company for each supervisory organization.
Associate a position with a company.
Use the Assign Organization subprocess.

If defaults are set up at the supervisory organization level, then the Assign Organization subprocess is only needed to edit the defaults for an individual worker. If defaults are not set up, it is important to include the Assign Organization subprocess in the Hire business process.

Another important subprocess is Assign Pay Group. You must assign workers to a pay group to include them in payroll processing. Workday can auto-complete a worker's pay group when:

Workday can determine the pay group based on Pay Group Auto Assignment rules.
You have configured the Assign Pay Group subprocess as a step in the Hire business process.
You have selected the Enable Autocomplete checkbox on the business process definition.

Enable the option to skip tasks by adding optional steps to the business process. Workday lists the step task in the user's Inbox and displays a Skip This Task button. If the user assigned to the role skips the step task, the business process then proceeds to the subsequent step.

Note

: You can configure ongoing payroll inputs to automatically end as part of a termination. Use the End Payroll Inputs business process (secured to the Core Payroll functional area) that you configure on the Termination business process.

To learn more, search Workday Community for: Steps: Set Up End Payroll Inputs for Terminated Workers

Edit a Pay Group

To edit a pay group, access the pay group's Related Actions menu and select Organization > Edit Organization. Remember, pay groups are a type of organization in Workday.

You may need to edit a pay group if there is a change to the first processing period date. Payroll history is payroll data for periods before the value in the Override First Processing Period field. Update the Override First Processing Period before calculating any payroll. After calculating the payroll, you can no longer change the first processing period date.