Managing TFR Termination Payments

This chapter discusses how to:

Process terminations.
Override termination elements.
Enter termination elements through positive input.
Run termination reports.

Processing Terminations

Entering the termination action on the Job component triggers the termination process. The system processes the termination payment the month after the termination date. In Italy terminated employees receive TFR payments (Trattamento di Fine Rapporto) that vary depending on length of service. Employees accrue an amount for each year of employment and the accrued amount increases each year according to the cost of living. When employees leave the organization, they receive the accrued amount, which is subject to tax.

To calculate termination pay, the system:

Calculates termination payment accrual.
Reevaluates the previous years' accrued TFR fund (ISTAT).
Calculates applicable income and months of reference income.
Manages TFR advance payments.

Employees can receive part of their TFR entitlement before termination. In such cases, the TFR payment they receive on termination is reduced by the amount paid in advance.
Calculates the payment and taxation of the accrued TFR in the month after termination (reference income, TFR tax rate, IRPEF on accrued TFR until 2000 and after 2000 and TFR Detractions).
Calculates payment and taxation of the accrued TFR Reevaluation in the month after termination (TFR Reevaluation and IRPEF on Reevaluation.)
Calculates the taxation of the other indemnities (Incentivo all'esodo, Notification payments and Integrazione transattiva).
Calculates the taxation on the increase in the TFR accrued amount. Taxation on the increase in the TFR accrued amount is a flat percentage (11% in 2006).

Note. The system calculates termination payments with the payroll, not as a separate process.

Overriding Termination Elements

Though most termination elements are taken from existing tables, you can override the following elements on the Supporting Element Overrides page (Global Payroll & Absence Mgmt, Payee Data, Create Overrides, Supporting Elements):

Element	Usage
TFR FM FLAGEROG	By default, TFR is paid a month after termination. If you set this element to 1, the TFR is paid in the month that employment is terminated.
TFR FM FLGTAXTFR	Set to 1 to force taxation of TFR after TFR has been paid and taxed. By default, the payroll process does not recalculate tax after the TFR is paid and taxed. However, if the tax needs to be recalculated, set this element to 1.
TFR VR RIVALPAG	Enter reevaluation to use on payment if different from calculated. For example, if you have paid the TFR before the official cost of living rate is published, you may need to adjust the TFR amount once the official rate is available.
TFR VR PCTPAGANT	Enter the percentage of the TFR fund to pay in advance. Use this variable when you want to pay TFR in advance based on a percentage of the accrued amount.

See Also

Setting Up Overrides

Viewing Delivered Elements

The PeopleSoft system delivers a query that you can run to view the names of all delivered elements designed for Italy. Instructions for running the query are provided in the PeopleSoft Enterprise Global Payroll 9.0 PeopleBook.

Entering Termination Earnings Using Positive Input

Though most termination elements are taken from existing tables, you can enter the following earnings using positive input:

Element	Description
RTRERPREAVV	Amount to pay as notification.
TFRERANTICIP	TFR advance payment.
RTRERINCESOD	Amount to pay as incentivo esodo.
RTRERINTTRAN	Amount to pay as integrazione transattiva.

Page Used to Enter Positive Input

Page Name	Object Name	Navigation	Usage
Positive Input	GP_PI_MNL_ERNDED	Global Payroll & Absence Mgmt, Payee Data, Assign Earnings and Deductions, One Time (Positive Input), Positive Input	Enter additional payments related to termination payments.

See Also

Working with Positive Input

Running Termination Reports

Global Payroll for Italy uses the print class KITFR on the Generic Report format for termination reports.

See Also

Setting Up and Running Generic Reports

Setting Up Print Classes and SQR Forms