Defining Average Salary Rules

This chapter provides an overview of the Average Salary calculations business process and explains how to define the rules for calculating an employee's average salary.

Understanding Average Salary Calculations

Employees who receive variable compensation, such as overtime or a differential for a night shift, may be entitled to have their vacation, termination, 13th salary, and maternity pay based on their average variable pay. Eligibility for the average salary allowance depends on union rules and the Consolidated Labor Laws (CLT).

To define your organization's rules for calculating the average salary:

Use the Average Version page to identify which earnings and deduction elements the system considers for the average salary version.

Also define the average salary calculation parameters for these elements.
Use the Averages page of the Union Parameters BRA component to associate, for a given union, the average salary version (identified in step 1) that the system is to consider when calculating the average salary for members of that union.

You can select different earnings and deduction elements for each run type.

When you run the payroll process, the system looks at the information you defined on the Averages page to determine which earnings and deductions to consider when calculating the employee's average salary. It then looks at the Average Version page for the specific calculation rules.

Note. The rule calculation for those earnings/deductions you want to pay using average salary must be an amount based on the average salary resolution formula.

Viewing Delivered Elements

The PeopleSoft system delivers a query that you can run to view the names of all delivered elements designed for Brazil. Instructions for running the query are provided in the PeopleSoft Enterprise Global Payroll 8.9 PeopleBook.

Defining Average Salary Rules

This section describes how to:

Define the average salary calculation parameters for earnings and deduction elements.
Define which earnings and deductions are subject to average salary calculations for each union.

Pages Used to Define Average Salary Rules

Page Name	Object Name	Navigation	Usage
Average Version	GPBR_AVG_VERSION	Set Up HRMS, Product Related, Global Payroll & Absence Mgmt, Framework, Organizational, Average Versions BRA	Identify the earnings and deduction elements that are used within the average salary calculations. Also define the average calculation parameters for these elements.
Averages	GPBR_AVERAGES	Set Up HRMS, Product Related, Global Payroll & Absence Mgmt, Framework, Organizational, Union Parameters BRA, Averages	For a given union, define the earnings and deduction elements the system is to consider for average salary calculations.

Defining the Average Salary Parameters

Access the Average Version page.

Entry Type

Select the type of element to include in the averages, for example, Earnings or Deduction.

Element Name

Select the earnings or deduction element that is to be considered in the average salary calculations.

Average Calculation Period

Identify the period of time to consider for this earnings or deduction element when calculating the average salary. The fields that appear in this group box vary depending on your selection in the Period Type field.

Period Type	Select the type of period on which to base the average salary calculations. Options are: Acquisitive Period: Select to consider amounts that were earned or deducted during the employee's current entitlement period. (The current entitlement period is often based on the employee's service date.) The entitlement period is built during the Vacation process (GPBR_VACN_AP), which includes GP rules and an Application Engine process that updates the entitlement period. The record GPBR_VACN_AP stores entitlement period information and can be viewed on the Vacation Acquisition Prd-Sched page. Defined Period: Select to consider amounts that were earned or deducted during the period defined by the From Date and To Date fields. Year: Select to consider amounts earned during the current year only. Use the To Date and End Date fields to define what portion of the current year to consider.
From Date	This field appears when you select Defined Period in the Period Type field. Select one of the following options: Before: Use values only from the very day before the current period starts (based on the date in the Begin Date field). Current: Use values from the current period being processed. Defined: Enter a date in the Begin Date field to indicate the start date.
Begin Date	This field appears when you select Defined Period in the Period Type field and Defined or Before in the From Date field. Enter the first date to take into account when selecting the amounts to include in the average calculation. A begin date functions like historical rule. The begin date is the first date the system takes into account; the process considers information from this date until the end date.
To Date	Define the last date to be considered. Select one of the following options: Defined. Months. Complete the # of Months field.
End Date	This field appears when you select Defined Period in the Period Type field and Defined in the To Date field. Enter the last date to take into account when selecting the amounts to include in the average calculation. An end date functions like historical rule. The end date is the last date the system takes into account; the process considers information from the begin date until this date.
# of Months (number of months)	This field appears when you select Months in the To Date field. Enter the number of months from the begin date that the system is to consider when performing the average salary calculations.

Average Type

Specify whether the amounts that are eligible for the average salary calculations should be adjusted for inflation. The system makes these adjustment when it reads the values for each month. For example, if the system reads the January results and needs to adjust those values, the new value for that month is the original value times the adjustment factor for the month.

Average Type

Identify which component(s) of the earnings or deduction element to adjust, if any. Options are:Units, Amount, and Units * Percentage.

Correct

Indicate whether amounts should be adjusted for inflation:

Correct Amount: Select to have the system adjust the amounts.

Don't Correct: Select if you do not want the system to adjust for inflation.

Index by Hourly Salary

Correct ID

This field appears if you select Correct Amount in the Correct filed. Enter the code for the monthly inflation adjustment.

Note. There is a bracket that stores correct IDs and their associated adjustment factors. You must enter the exact correct ID in this field to have the system find and use the correct adjustment factor.

Averages Calculation

Divider	To calculate the average, the system can divide by a fixed number or by the number of periods that you specify. Options are Fix and Period. Fix: Select to have the system divide the total earnings or deduction amount that is eligible for the average salary calculation by the number that you enter in the By field. Per/Wrk M: Select to have the system divide the total earnings or deduction amount only by the number of months in the average period. For example, if the average period is from 12/31 to 01/01 but the employee was hired or terminated during this period of time, then instead of dividing the result by 12, the system divides by the proportion of months between the hire or termination date.
By	If you selected Fix in the Divide field, enter the number you want the system to divide by.
Min # Occurrences (minimum number of occurrences)	Specify the number of times during the defined period that this earning or deduction must occur in order for it to be used in the average salary calculation. For example, if you enter 3 in this field and an employee receives a particular earning twice during the period, that earning will not be considered in the average salary calculations. Enter 0 in this field to have the system always consider the earnings and deductions.
Take n Greater	Enter the number of occurrences of the earnings or deduction in the defined period that are to be used in the average salary calculations. The system selects the amounts with the highest values (after adjusting for inflation, if you selected Correct Amount in the Correct field . For example, if you enter 5 in this field for an earnings element, the system averages the five highest earnings amounts that were calculated for this element during the defined period. Enter 0 (zero) in this field if you want the system to consider all earnings and deduction amounts for the defined period.

Defining Average Calculation Rules by Union

Access the Averages page for a particular union.

Earnings/Deductions

Run Type	Select the type of payroll process for which you want to define the average version of the pay component. For each run type, you can select a different set of earnings and deduction elements to calculate using the average salary calculation.
Entry Type	Select the type of element to consider in the average salary calculations: earnings or deduction.
Element Name	Select the name of the earnings or deduction element.
Average Version	Select the name of the set of parameters you defined on the Average Version page.

Entry Type	Select the type of element to include in the averages, for example, Earnings or Deduction.
Element Name	Select the earnings or deduction element that is to be considered in the average salary calculations.