Understanding Overtime Payments

This chapter provides an overview of overtime payments and discusses:

• Time off in lieu of compensation.

• Overtime elements

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

See Also

Viewing the Delivered Elements

Overtime Payments Using Global Payroll for France

Global Payroll for France provides you with the ability to pay for overtime hours. Overtime exists when an eligible payee works more than the standard number of hours during a week stipulated by the French government. If a payee works overtime, an employer is obligated to pay a surcharge on the extra time worked. If the extra time worked exceeds a second limit, then an employer may have to give the payee time off in lieu (repos compensateur). Overtime calculations are based on a weekly calculation of hours worked, but in certain situations the standard working hours can be calculated on a yearly basis. This is referred to as the modulation of working hours. The modulation of working hours can be set up in companies if a collective agreement or a company or establishment agree exists.

Global Payroll for France does not calculate the overtime hours. Overtime hour calculations must take place outside of the system. Global Payroll for France provides the functionality to pay those overtime hours that are calculated outside of the system.

There are also some special rules about overtime rates that apply to part-time workers, young people, apprentices, and executive managers.

Note. Some payees, such as executive managers, are not subject to normal overtime rules. Such payees may not be eligible for overtime. PeopleSoft does not control whether overtime must be paid for each category of payee. It is your responsibility to decide whether to input extra hours for these payees.

Overtime hours are entered into Global Payroll for France using positive input:

• If your organization uses PeopleSoft Enterprise Time and Labor, the calculation for the different types of work hours is done by Time and Labor, and that data is passed to Global Payroll for calculation through automated positive input.

• If your organization uses a third-party time and labor application, the calculation for the different types of work hours is done by that application, and then the data is passed to Global Payroll for payroll calculation through automated positive input.

• If your organization does not use Time and Labor or a third-party time and labor application, enter the hours manually using the Positive Input page. The payroll process calculates only the earnings attached to those hours and updates the correct accumulators.

Warning! PeopleSoft does not restrict the input of hours that are over the legal limit. It is up to you to apply the law to your setup. If you want an automated method by which to control the input of hours to ensure that they do not exceed the legal limit, you can use Time and Labor.

See Also

Working with Positive Input

Time Off in Lieu of Compensation

Some overtime may be taken as time off in lieu of compensation. These hours are known as bonus hours. There are two different types of compensation in lieu of time off:

• Repos compensateur

  This type of compensation adheres to certain regulatory rules for its calculation. This type stipulates that when a payee works over a weekly hour limit in a week, that payee is entitled to receive some hours paid with a surcharge and to also acquire some compensation in lieu entitlement.

• Récupération d’heures

  This type is not stipulated by regulations and companies can decide whether to apply this rule. This type enables a payee to take some time off instead of being paid for the overtime.

Earnings HR BON 100%, HRS BON 10%, HRS BOS 100%, and HRS BOS 10% are used to store the necessary values to process compensation in lieu of time off. These earnings are used as values to process the récupération d’heures.

Enter the number of hours a payee wants to save for future compensation in lieu using positive input. The hours input in the earnings HRS BOS 100% (earnings that pays the bonus hours at 100 percent) and HRS BOS 10% (earnings that pays the 10 percent surcharge for the bonus hours) are accumulated in the accumulator HRS AC HRS BOS SG. The hours input into HRS AC HRS BOS SG are added to the accumulator for 10 percent of their value as they are only equal to a 10 percent surcharge of the bonus hours.

The earnings HRS BOS 100% and HRS BOS 10% are resolved to zero. They are used to populate the compensation hours accumulators. The earnings HRS BOS 100% and HRS BOS 10% are resolved to zero because the result of their calculation is not to perform the payment of hours but the accumulation of these hours in some balance accumulators. These earnings are used to tell the system that the employee wants the hours to be saved for the future, rather than to be paid immediately.

Sometimes a payee can take some time off in lieu of compensation by the half-day or complete day. When a payee takes a paid half-day or complete day off, the entitlement is decreased accordingly. A payee is entitled to take compensation in lieu once they accumulate seven hours. Two accumulators manage this entitlement:

• HRS AC RCOMP EX PP

  This accumulator stores the time off in lieu of compensation that can be taken by the payee. Each time a payee accumulates seven hours of time off in lieu, the accumulator HRS AC RCOMP EX PP increases by one day.

• HRS AC RCOMP NE PP

  This accumulator stores any time off in lieu of compensation entitlements that are less than seven hours. Each time a payee accumulates seven hours of time off in lieu, this accumulator decreases by seven hours.

Trigger the calculation for time off in lieu using positive input. When you enter positive input for the earning HRS REP COMP, indicate as UNIT the number of hours that you want to give as entitlement for time off in lieu. These hours are split into the HRS AC RCOMP EX PP and HRS AC RCOMP NE PP accumulators based on whether the payee can take some time off or if the payee has not yet acquired complete entitlements.

A message is printed on payslips notifying payees that a new entitlement is available along with a message indicating the date by which they must take the hours. The date by which they must take the hours is the end of the current pay period plus two months.

Note. Global Payroll for France does not manage the loss of entitlements if a payee does not take time off in lieu of compensation during the two months following the acquisition of the entitlement.

See Also

Defining Generation Control Elements

Overtime Elements

This section discusses these delivered overtime elements:

• Earnings

• Rate codes

Earnings

PeopleSoft delivers earnings for overtime, but does not maintain these elements. All of the delivered overtime rules assume that your system receives positive input on a weekly basis. If you want to send only one set of positive input per month, then create only one instance of the earnings.

Global Payroll for France assumes that the pay period is monthly and that the pay period always starts on the first day of the month. If the pay period is monthly, but the pay period does not start on the first day of the month, you must modify the formula HRS FM PRIMES TX to put the first day of the month in the variable HRS VR PRIM DATE. If the pay period is not monthly, then you must modify the entire PeopleSoft delivered setup to reflect the correct pay period.

The usual calculation method for overtime earnings is Unit x Rate x Percent, where:

• Unit is a variable that stores the number of hours (entered by positive input)

• Rate is a formula that calculates the hourly rate.

• Percent is a variable that gives the percentage of surcharge. Modify this percentage if your company is over the legal percentage.

Note. If you want to pay overtime hours at rates different than those stipulated by law, modify the earnings elements to do so. In some cases, PeopleSoft has provided delivered element names—for example, HRS SUP 125%— that include the percentage in the name of the element. If you modify the percentage in such a delivered element, then the name of the element and the percentage it represents will not match and this could prove confusing to your payroll personnel. In such cases, PeopleSoft recommends that you create your own elements.

This table lists the earnings that PeopleSoft delivers for overtime processing:

There are no generation controls for these earnings. The element group HRS EG OVERTIME includes the earnings used for the overtime hours. The element assignment definition for these earnings is By Payee. This means that these earnings are triggered only if an assignment exists at the payee level (as positive input).

If you use rate codes to determine the hourly rate, for all of the earnings listed in the previous table, except HRS REP COMP, the system expects an override of the system element RATE AS OF DATE. The RATE AS OF DATE system element is used to evaluate the hourly rate used to pay the overtime hours. The system resolves RATE AS OF DATE with the value of the segment end date.

The system calculates the hourly rate as of this date.

Note. PeopleSoft delivers a query that you can run to view the names of all delivered elements designed for France.

See Also

Working with Positive Input

Viewing Delivered Elements and System Data

Defining Earning and Deduction Elements

Rate Codes

Rate codes exist for the various types of overtime. If you are using rate codes for the determination of the hourly rate, then you must override the system element RATE AS OF DATE for all of the overtime earnings except HRS REP COMP. The rate code value is retrieved with the value active as of this date. Define RATE AS OF DATE as the last day of the week if you want the hourly rate to be calculated with the correct effective-dated rate code for the week in which the hours were worked. If you don’t override RATE AS OF DATE, the hourly rate is calculated with the value of the rate code active as of the segment end date. You should also carefully consider any possible salary changes during the pay period month because these change the rate code values used in the calculation of the hourly rate.

Enter the number of hours as the unit of the positive input to override the value of the system element RATE AS OF DATE by a date. When a user enters a positive input for an overtime hour, he must encode the number of hours as unit and he can encode the date for the system element Rate As Of Date as supporting element override. By doing that, the system will be able to use the rate code “active” or to take into consideration at the date of the overtime hour. Typically, overtime hours are calculated each week and by entering a different PI for each week (with the corresponding unit), the user can override the Rate As Of Date SY in order for the system to be able to calculate the salary hourly rate at the date the overtime hours occurred. In the case of a salary increase during the month, the hourly rate will change depending on the Rate As Of Date overridden based on the different dates. This date is used to retrieve the effective rate code as of the given date. However, salary is not comprised solely of rate codes. For example, the system needs to manage premiums that are paid during the month to properly calculate the hourly rate. Premiums are then added to the rate codes to calculate the hourly rate. Premiums are calculated by the payroll process and apply to the entire month.

You must maintain the formula HRS FM SALBAS TX H indicating the rate codes to take into account and the accumulator HRS AC CAL PRIM SG indicating the premiums that are added to the rate codes.

Note. Global Payroll for France uses the system element RATE AS OF DATE to retrieve the premiums of the current month or of the previous month. This is because some companies pay the overtime hours with a one-month delay.

See Also

Working with Positive Input