Grouping Employees

This chapter provides an overview of grouping and discusses how to:

• Use time-sensitive grouping based on eligibility.

• Use groups for periodic processing.

• Define a group.

• Set up group precedence.

Understanding Grouping

A pension plan can include unique provisions for different subsets of your employee population. There might be different rules for:

• Salaried and hourly employees.

• Employees in different unions.

• Employees who were covered under an acquired company’s plan.

A critical step in implementing your plan rules is applying the rules to the appropriate groups. Use custom statements to specify criteria to define each group. The group definitions can be shared among plans and function results.

You can set up group precedence to establish a method for handling situations when an employee falls into more than one group. The precedence is specific to each function result, so you can set up different precedence orders for different areas of your plan.

Periodic processing can use group definitions to determine which employees to process in a particular job.

Groups are extremely important to implementing your plan rules. Group membership controls which rules are used at every step of the calculation. Consider the following examples, which illustrate the power of this feature.

Time-Based Grouping

When you grandfather rules, you set up time-based groups to identify employees who qualify for the grandfathered benefit. For example, in 1970 you changed your plan rules from five-year cliff vesting to seven-year step vesting:

Grouping with Benefit Eligibility

You only want to calculate the reduced benefit amount for employees who are eligible for early retirement:

Note. There’s no group for employees who are not eligible. Those employees will bypass this function result. Therefore, you need to be very careful that no other function result down the line looks for the missing results.

Grouping with Service

Your cash balance account credits vary with service:

Grouping with Vesting

Vested employees use different break-in-service rules from unvested employees:

Grouping Based on Job

You negotiate different unreduced early retirement criteria with different unions:

Grouping Based on Employee Type

Full-time employees use elapsed time service. Part-time employees use hours counting service:

Grouping Based on Calculation Reason

Death benefits have a different (reduced) set of optional forms from regular retirement benefits:

Calculate social security benefits differently for old age retirement and disability retirement:

Grouping Based on Payee

Qualified Domestic Relations Order (QDRO) calculations are based on an amount entered into the system by the administrator. The calculation then runs the early and late retirement factors and optional forms of payment functions to apply any early retirement reduction and produce optional form choices. These two functions, therefore, may need QDRO-specific definitions:

Using Time-Sensitive Grouping Based on Eligibility

This section provides overview of eligibility and eligibility-based groups and discusses setting up eligibility-based groups.

Understanding Eligibility

The plan eligibility function produces a timeline of eligible and ineligible periods. Service typically accrues only during periods of eligibility. Cash balance accounts and employee contributory accounts typically accumulate both credits and interest during periods of eligibility, but only accumulate interest during periods of ineligibility.

Understanding Eligibility-Based Groups

Following are some examples that use eligibility history as grouping criteria.

Service

Service only accrues while an employee meets plan eligibility criteria:

Elapsed time and hours equivalence service accrue based on an employee’s action and reason history. If you fail to establish eligible and ineligible definitions, employees continue to accrue service for time worked while ineligible. For example, an hourly employee who used to be salaried could continue to accrue service under the salaried plan. This may be desirable for vesting service, but is likely undesirable in other situations.

Hours counting service accrues based on consolidated hours. If the consolidated hours definition already distinguishes between hours worked while eligible and hours worked while ineligible, you may not need to create separate eligible and ineligible definitions for this service type.

Cash Balance Accounts

Accounts earn interest at all times, but only get additional earnings-based credits during periods of eligibility:

If the consolidated earnings definition excludes ineligible earnings, you may not need to set up eligible and ineligible groups for cash balance accounts.

If the consolidated contributions definition only includes eligible contributions, you may not need to set up eligible and ineligible groups for employee accounts.

Consolidated Earnings

The final average earnings (FAE) function only uses earnings from periods when an employee met the plan’s eligibility requirements. Because FAE uses the consolidated earnings result, you restrict earnings at the consolidation level:

Note. In this scenario, you would set the FAE definition to ignore zeros. Otherwise, you might lower the average by picking up zeros from periods of ineligibility.

Setting Up Eligibility-Based Groups

When employees change jobs within a company, they often move into and out of pension plan eligibility. When you run a calculation for such an employee, service accrual may stop during the period of ineligibility and resume if the employee becomes eligible again. For a cash balance plan, account credits probably stop, but interest continues during the period of ineligibility. You may also want to exclude earnings from the consolidated earnings history to prevent the final average earnings function from using the ineligible earnings.

All of these scenarios demand that you set up different definitions for eligible and ineligible periods. As employees move in and out of eligibility, the system will automatically use the appropriate definition for the eligible and ineligible periods. To apply these eligible and ineligible definitions, you need eligible and ineligible groups.

Note. PeopleSoft delivers two group custom statements: PA_ELIG and PA_INELIG. When you select Eligible or Ineligible, the system uses these statements to append the eligible or ineligible criteria to your group. Do not modify these statements.

See Also

Setting Up Function Results

Using Groups for Periodic Processing

Periodic processes are processes that you run on a regular basis to maintain your pension data. Consolidations run only as periodic processes, and other functions which store history also run in periodic mode.

You can run periodic processes for:

• All employees at once.

• Individual employees.

• Employees identified by employee ID on a predefined list.

• Employees who meet criteria defined by a group custom statement.

When you use a group custom statement, the system evaluates every employee in the system against the criteria to determine whom to process. This is a very slow process, and PeopleSoft does not recommend that you use it on a regular basis. Instead, use predefined employee lists, which process those employees on the list without needing to evaluate any other employees.

Note. List processing is much more efficient than group processing. A group that you define to include all employees belonging to Plan A takes exponentially longer to process than a list that includes the same employees. It is well worth your while to use SQRs to create and maintain lists for periodic processing. For example, to process all employees who are paid monthly, do not create a group with this criteria. Instead, create an SQR that selects employees who are paid monthly and creates a calculation group list consisting of those employees. Run that SQR again before each periodic processing run in order to keep your list up to date.

Defining a Group

You define a group on the Custom Statement page. You access a group on the Group Definition page. The statement type is always G (Group Function Definition).

When you set up group custom statements, you enter the requirements in Boolean If clauses. You do not need the Then portion of the If-Then statement. When an employee meets the conditions, a yes value is assumed.

You can base groups on any criteria that the database tracks. This might include:

• Personal and job data—for example, the employee status is active.

• The event reason entered at calculation time—for example, the event reason is death.

• Results from other parts of the calculation—for example, the vesting percentage is 100.

See Also

Using Custom Statements and Spouse Eligibility Statements

Setting Up Group Precedence

To set up grouping precedence, use the Group Precedence (GROUP_PRECEDENCE) component.

This section provides an overview of group precedence, list the page used to set up group precedence, and discusses how to define group precedence.

Understanding Group Precedence

When you set up a function result, you associate groups with the definitions that they use. Implicit in this organization is the requirement that each employee only belong to a single group. If an employee meets the criteria for multiple groups, you need a way to determine which group affiliation takes precedence.

The Function Result page includes a precedence order field; however, you can only see one row of data at a time, so setting up the precedence order can involve a lot of scrolling.

A more convenient way to set your precedence order is to use the Group Precedence page. This page displays all the groups used in a function result in a convenient summary format that enables you to easily review all the groups and their precedences. This page is always keyed to a specific effective-dated row within a function result.

Page Used to Set Up Group Precedence

Defining Group Precedence

Access the Group Precedence page.

Group	The page displays the group information from the Function Result page.
Precedence Order	This establishes which group to use for an employee who meets the conditions for multiple groups. A group with a lower number has precedence over a group with a higher number. For example, employees who simultaneously fall into groups with precedence orders 1 and 2 use the definitions for the group with precedence 1.

See Also

Setting Up Function Results