Setting Up Absences

This chapter provides overviews of absences and absence rules and discusses how to report absence data.

See Also

Understanding Absence Management

Defining Absence Elements

Entering and Processing Absences

Understanding Absences

Global Payroll for Italy processes absences that are entered on the Absence Event Entry page. This section discusses:

• Vacations.

• Festivities.

• Reduction of working hours.

• Licenses.

• Maternity leave.

• Work accidents and professional illness.

• Illness.

• Disabled payee licenses.

• Marriage leave.

• CIG absences.

See Also

Entering Updating, and Voiding Absence Events

Vacations

The system uses the following terms:

• Due units (days or hours).

  The vacation units the employee is entitled to each year, according to labor and company agreements. May vary according to category and seniority.

• Accrued units.

  Part of the total of the due units that the employee has accrued and can use. Time is accrued each month of active service.

• Used units.

  The actual units used by the employee.

• Use period.

  The period when the employee can use the days accrued every year.

• Accrual period.

  The period when the employee accrues vacation days. Accrual periods are decided at the company level. Companies may apply different rules based on employee category. The following table shows when an absence or period is a vacation accrual period:

  Absence/Period	Vacation Accrued?
  Absences for illness or work accident.	Y
  Absences, such as mandatory maternity leave and marriage leave.	Y
  Paid licenses.	Y
  Probation period.	Y
  Worked and paid notice period.	Y
  Absences for military service.	N
  Optional maternity leave.	N
  Extended leave.	N
  Periods of INPS assistance - Cassa Integrazione.	N

Festivities

The system accounts for civil and religious festivities.

Reduction of Working Hours

Labor agreements, national law, and company rules dictate the details of reduced working hours (ROLS). These details include the amount, usage, and accrual of ROLS.

The amount the employees receive for licenses is assessable income for contributions and taxes.

Licenses

Employees are entitled to absence for certain situations. Some examples are explained in this table:

Maternity Leave

While on maternity leave, an employee receives a salary based on maternity allowances from the INPS and the employer. While on leave, employees continue to accrue seniority and maintain the right to keep their job. The employer disburses the maternity allowance on a monthly basis. By making monthly payments, the employer is providing the allowance before receiving this money from INPS. The organization must then request a refund from INPS on the DM10 report.

The labor agreement (CCNL) can guarantee an allowance greater than that given by the INPS, in which case the employer pays the difference.

The INPS allowance is based on the average daily salary, referred to as RMG-INPS. This amount does not change during the maternity period, regardless of any change in employee status, such as seniority. This allowance includes cases in which the employee returns to work, receives a salary increase, and then continues maternity leave.

Thus, the employer must pay:

• An advance of the INPS allowance.

• The difference between the INPS and CCNL allowances.

• Festivity payments occurring during maternity leave.

The three types of maternity leave are mandatory, optional, and daily break. This section discusses each of these, as well as child illness license and employer integration.

Mandatory Maternity Leave

Mandatory maternity leave lasts at least five months (possibly longer), depending on the job and contract. It is composed of pre-childbirth and post-childbirth periods.

INPS grants an allowance equal to 80 percent of an average salary (RMG-INPS). The labor agreement may grant a larger percentage. The employer pays the difference.

Earlier mandatory maternity leave grants additional months to the pre-childbirth entitlement period.

Optional Maternity Leave

At any time before the baby's third birthday, the parent can take up to six months (180 days) of optional maternity leave. The total leave amount can be divided into multiple smaller periods. The optional maternity pay rate by INPS is 30 percent of the RMG-INPS.

Additional monthly payments are not accrued during optional maternity periods.

Calculating Maternity Leave

The maternity allowance is a percentage of the average daily salary that the employee earned the month before the beginning of the absence. If the optional maternity absence is not directly linked to mandatory maternity, the allowance base is calculated using the wages from the month prior to the optional maternity absence.

This table lists the amounts paid by the INPS for maternity leave:

This table lists the days considered for allowance payment:

The reference salary contains the following elements:

• Earnings paid at the end of each pay period, such as base salary and overtime.

• Earning paid on a regular basis, such as additional monthly payments and allowances for unused vacation days.

The rules governing the calculation of the RMG-INPS depend on the category and the employment type.

Daily Break

According to government regulations, the employee may use two one-hour breaks per day before the baby's first birthday. If the employee's contractual hours are less than six hours per day, she is entitled to only one one-hour break per day. If the employee has more than one infant, she is allowed double the normal allowance. The employee must schedule this break with the employer.

This break is completely paid by the INPS and includes the gross salary and every accessory earning normally received on a continuing basis, such as the monthly rate for additional monthly payments. Overtime is excluded from this calculation. To calculate the hourly rate, the system uses the CCNL hourly coefficient.

Like the Maternity Allowance, the employer makes the payment before receiving reimbursement from the INPS. The INPS amount is not applicable to contributions.

Daily break allowances, hourly rates used, and the corresponding additional monthly payments must be shown separately from other amounts on the payslip.

Child Illness License

Both parents are entitled to unpaid absences for a child's illness when that child is younger than eight years old. Employees are granted seniority increases during this absence, regardless of whether they are given an allowance.

The entire period of certified illness for children under three years is covered by the license. From age three to eight, a period of five working days is granted each year.

Employer Integration

Employers pay a supplement for maternity leave that depends on the national labor agreement for the industry sector. This table lists the employer's supplement for each industry sector:

Work Accidents and Professional Illness

A work accident is one that:

• Happens violently and causes damage to the employee.

• Is due to the specific employee's job and happens while that job is being performed.

• Causes death or a temporary or permanent disability.

Professional illness is an alteration of an employee's health caused by that employee's specific job. The National Authority for the Insurances and the Work Accidents (INAIL) is responsible for these allowances. All other similar events that have different characteristics are classified as illness. INAIL allowances cannot be accumulated with INPS allowances.

Work accident indemnity is calculated through two takes, depending on the period. The user must always enter take INA AT PERIODO1. The second take is automatically triggered.

This section discusses how to calculate the INAIL average salary.

Calculating the INAIL Average Salary

INAIL allowances are computed using an average daily salary. The calculation differs for hourly and monthly waged employees:

• Hourly compensated employees.

  The INAIL allowance is the sum of the following elements (each element refers to amounts accumulated in the 15 days before the accident):

  • Regular hourly wage.

  • Average payment for overtime.

  • Average payment for vacation.

  • Average payment for festivity.

  • Additional monthly payments.

  • Other annual payments.

  • Other additional elements.

• Monthly compensated employees.

  The INAIL allowance is the sum of the following elements:

  • Regular hourly wage.

  • Average payment for overtime.

  • Average payment for vacation.

  • Additional monthly payments.

  • Other annual payments.

  • Other additional elements.

  Note. Festivities are not included in the INAIL allowance.

Employer Supplement

Employer payments are regulated by law. These laws are augmented by the national labor agreements. The majority of labor agreements state that the employer should guarantee a percentage of the normal salary for a fixed period in the event of a work accident.

The employer may pay the work accident allowance before receiving funds from the government.

The employer may pay the allowance after receiving funds from INAIL.

Contribution and Tax Treatment

The work accident allowance from INAIL is taxable, but it is free from other deductions. However, the employer integration is subject to other deductions. Once in receipt of the check from INAIL, the employer must compare the actual INAIL allowance with the amount paid to the employee. Any accounting differences must then be resolved.

Festivities During Absences

If a festivity occurs during an illness period, the employee receives 100 percent of the INAIL average salary. The employer pays the amount not allocated by INAIL. Thus, the employer pays:

• 100 percent of the INAIL average salary during carenza.

• 40 percent of the INAIL average salary when INAIL pays 60 percent.

• 25 percent of the INAIL average salary when INAIL pays 75 percent.

Illness

For illness allowances paid by INPS, the first three days are paid by the employer without any repayment from INPS. For the remaining days, INPS pays a percentage of the total salary. In most cases, the CCNL states that the employer must pay the remainder of the regular salary. Normally the employer pays this allowance in advance and is later reimbursed by INPS. The calculation is composed of three parts: days covered by INPS, the allowance paid by INPS, and the allowance paid by the employer. Each of these requires access to past records.

Illness indemnity is calculated through two takes, depending on the period. The user must always enter the MAL AT OFFSET take. The second take is triggered automatically.

Note. When implementing Global Payroll for Italy, you must be able to work with previous absence and payroll data in order to correctly assess each employee's situation.

Disability Licenses

Special licenses are assigned to three types of beneficiaries: disabled employees, employees with disabled children, and employees with disabled relatives (as long as these relatives are within the third degree and reside with the employee). INPS is charged for the payment of these licenses, but the employer pays the allowance in advance. Payees absent for disabled licenses do not accrue vacation time and time for additional monthly payments, but they do accrue seniority.

Because DM10 Codes related to this INPS allowance are different for each type of beneficiary, different absence takes must be used to generate different earnings codes for INPS allowance payments.

Disability licenses are calculated using the gross salary, including every accessory earning the employee normally receives on a continuing basis. If the employee receives other earnings with a different frequency, only the ones that constitute the normal remuneration, such as additional monthly payments, should be included in the calculation. Overtime is excluded from this calculation.

If two absence takes are defined for the same absence event, the user should always enter the absence take code defined for the first period. The system automatically uses the absence rules for the second period when the first period entitlement is expended.

Marriage Leave

Every employee is granted a paid leave for marriage. The calculation is different for Impiegati and Operai.

For Impiegati, the employer is fully responsible for remuneration. The payee receives normal salary during the leave, with no allowance related to performance and no changes to the treatment of contributions and taxes. If the marriage leave coincides with another absence, the employee only gets the marriage leave, unless the marriage leave is postponed.

For industry Operai, the employer must integrate the Check for Marriage Leave Assegno per congedo matrimoniale paid by INPS-CUAF. The employee is also paid for any festivities that occur during the marriage leave.

INPS is charged for this allowance, using the DM10 form, but the employer pays the allowance in advance. The allowance is not applicable to contribution payments, but it is taxable.

CIG Absences

Cassa Integrazione Guadagni (CIG) absences are used in special situations when employers put employees on temporary leave due to problems within the company or because the employee is unable to work due to bad weather. Employers can make a request to the INPS for partial payment of salaries for employees who are on this type of leave.

Understanding Absence Rules

This section discusses:

• Delivered maternity leave elements.

• Delivered general absence deductions.

• Delivered license and vacation earnings.

• Delivered INAIL earnings.

• Delivered illness absence elements.

• Delivered marriage leave absence elements.

• Delivered disability leave absence elements.

• Delivered CIG absence elements.

• Delivered supporting elements.

• Viewing delivered elements.

Delivered Maternity Leave Elements

This table lists the delivered earnings for maternity leave:

This table lists the delivered deductions for maternity leave:

Delivered General Absence Deductions

This table lists delivered general absence deductions:

Delivered License and Vacation Earnings

This table lists delivered earnings for licenses and vacations:

Delivered INAIL Earnings

This table lists delivered INAIL absence earnings:

This table lists the delivered INAIL absence deduction:

Delivered Illness Absence Elements

This table lists the delivered illness absence takes and entitlement:

Delivered Marriage Leave Absence Elements

This table lists the delivered absence take and linked absence entitlement:

Delivered Disability Leave Absence Elements

This table lists the delivered absence take and linked absence entitlement:

Delivered CIG Absence Elements

This table lists the delivered absence takes and linked absence entitlement:

Delivered Supporting Elements

The bracket GEN BR COMPANY is used in the processing of INAIL contributions and reporting. The lookup value for the bracket is company code, and it returns the INAIL code and INAIL site for that company code. Set up the bracket with your organization's company codes and the corresponding INAIL codes and INAIL sites.

See Also

Defining Bracket Elements

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 9.1 PeopleBook.

See Also

Understanding How to View Delivered Elements

Reporting Absence Data

This section provides an overview of absence data reporting and discusses how to run the S503 report.

Understanding Absence Data Reporting

These reports include absence data:

• Payslip.

• CUD form.

• 770 form.

• DM10.

• S503 payment request for illness and maternity allowances.

See Also

Generating Payslips

Preparing the DM10 Form

Global Payroll for Italy Reports

Pages Used to Review Absence Data and Run the S503 Report

Running the S503 Report

Access the S503 Report ITA page (Global Payroll & Absence Mgmt, Absence and Payroll Processing, Reports, S503 Report ITA, S503 Report ITA).

Use the From Date and To Date fields to restrict the range in which the event payment date must fall.

Selecting the Report Format

When you click Run, the Process Scheduler Request page lists these options: