Deduction Frequency HR and Payroll
Did you know that Abra HRMS uses the Employee Contribution Frequency on the Benefit Plans and the Withholding Cycle on the Deduction Code Detail to determine the amount to deduct when a Payroll deduction is linked to an HR benefit? Therefore a single benefit can be created on the HR side using monthly amounts, and a single deduction can be created and linked on the Payroll side in which the withholding cycle is Withhold All Periods.
Based on the Calculation of Linked Benefits Theory, the payroll engine will use an employee's pay frequency to determine the correct amount to deduct each period. Therefore, it is not necessary for you to have one benefit and deduction for your weekly employees and one benefit and deduction for your bi-weekly employees and then yet a third benefit and deduction for your employees who are paid monthly. This makes not only initial setup quite a bit simpler, but also balancing and yearly rate changes.
NOTE: If the Employee Contribution Frequency on the Benefit Plan and the Withholding Cycle on the Deduction Code Detail are not correctly set it can cause unexpected amounts to be deducted during the payroll process. Even if you have no intention of changing your setup at this time, it is strongly recommended that you have a full understanding of the calculation of linked benefits.To get the most from your Sage HRMS, contact us today!