Step 4: Setting up for Salary Types and Formulas

Things you need to prepare: 

• Pay types such as Basic Salary, Overtime pay, Annual leave pay, Sick leave pay, Late deduction etc...
• Pay formulas for those company pay types, how they are being calculated 
• Pay formulas for different companies (Top organization)

1) Create Pay Types (Salary Types) 

Note 1* Pay type code cannot be modified after created, while Pay type name can be modified anytime

Note 2* Pay type contains its payment nature and would be used in Job order template (Salary formulas) 

• Go to Master Data --> Pay Type
• Add New
• Input a short, clean pay type code (eg: ''P1'', ''P2'', ''P3'' or ''BS'' for basic salary, ''OT'' for overtime pay)
• Has unit rate?: If this pay type amount calculated by unit (eg: minutes, hours, days etc.....) 
  • Note* Disable unit rate for a fixed pay amount (a fixed pay amount won't be affected by employee's attendance such as year-end double pay)
• Is Cash?: Is actual cash payment paid to employees or deducted from employee gross salary
  • Note* MPF contribution by employer is not ''Cash'' as it was not paid to employee's gross salary
  • Note*MPF contribution by employee is ''Cash'' as it actually deducted from gross salary
• Is Gross Salary?: Is a recurrent payment that within wages, including allowances, commission, and overtime salary
  • Note* Pension fund like MPF contribution by the employer/employee is not  ''Gross Salary'' 
  • Note* Value of any accommodation, education, food, medical care provided by the employer is not ''Gross Salary'' 

2) Create Job Order Template (Salary Formulas) 

A job order template included all pay types you have created at first stage, you could also define salary formula for each pay type.

Note 1* If Parent Organizations(eg: Carbonik Company & Backstage Company) use the same pay type formulas, they could share the same Job Order Template, otherwise a new Job Order Template should be created 

Note 2*  Set up pay type formulas and define the payment nature for each pay type, whether it is taxable and is relevant income for MPF contribution etc.

Note 3* Job Order Template Code can't be modified after created, while Job Order Template Name can be modified anytime 

Note 4* All pay formulas in Job Order Template will directly affect the amounts  in payroll batches

Now follow steps below to set up Job Order Template 

• Go to Master Data --> Job Order Template 
• Add New
• Input a simple code and name that are easy to remember 
• Set up pay formulas 
  • Enable ''Is Active?'' 
  • Enable ''Is Basic Salary'' if this is original basic salary
  • Enable "Is Overtime Salary'' if this is overtime salary. If the monthly overtime payment is over 20% of the average wage, then this payment will be included in ADW(Average Daily Wage) calculation
  • Enable "Is Relevant Income'' if this is included in MPF contribution 
  • Enable "Is Minimum Wage'' if this is included in the average hourly wage for minimum wage calculation

The product of ''Pay unit rate'' and ''Pay number of unit'' will be the ''Amount'' payable to employee's salary (see below payroll)

Example of setting up Basic Salary 

Note 1* Use ''[ ]'' for each variable and ''( )'' to call leave type entry, pay type amount inside the variable

Note 2* Use '' + '' to add, '' - '' to subtract, '' * '' to multiply and '' / '' to divide values

Note 3* Substract taken leave days [LD] from no. of days in period [WD] so you won't pay for absent days 

Note 4* [PR]: This variable Pay Rate is a value that you defined in placement's salary section, see below picture of the placement file

For the usage and description of variables, you can mouse-over on it to check its full description

3) Define Job Order for each Parent Organization

• Go to Staff --> Job Order 
• Add New
• Input Job Order Number (cannot be modified once created)
• Define four essential fields at this stage 
  • Choose the same parent organization for Client and Employer 
  • Job Order Template
  • Currency

Next >  Step 4: Setting up for Leave Policy and Roster