Setting Up Reference Periods

Profit sharing calculations are based on company or establishment accounting data over a period known as a reference period. Typically, reference periods are for a year and match the fiscal year. However, you can create reference periods for any period to suit your organizational requirements.

At the end of the reference period, when company information is available and employee salaries are finalized, the administrator schedules the profit sharing processes to calculate and distribute the global fund.

Agreements can cover one or more reference periods, depending on the agreement type and the agreement setup:

• Worker's participation agreements (intéressement des salariés) are typically for three years.

  If the reference period is a year, you create three reference periods, one for each year. However, if the reference period is three months, you define 12 reference periods for the agreement (4 reference periods a year * 3 years).

• Profit-sharing agreements (participation aux résultats) can have a fixed duration or an unspecified duration.

  If the duration is not defined, the administrator can create any number of reference periods.

You set up reference periods for an agreement only after the agreement is signed by all the relevant groups and the status is set to Approved.

To define reference periods for an agreement, you need to:

• Define how the Manage Profit Sharing business process imports information from your payroll system.

  This is defined for each reference period. The distribution calculations require employee payroll information, which is imported when the Extract Eligible Employees process runs.

• (Optional) Define the Carry Forward and Carry Over amounts for each reference period.

  This applies to profit-sharing agreements only. When part of the global fund remains after distribution to employees, you can specify that the surplus is added to the fund for the next reference period. Equally, a surplus in the previous reference period can result in an amount being added to the current reference period. These values are automatically calculated by the system, but you can override the calculated values before running the remaining processes.

This section discusses:

• Importing data from PeopleSoft Global Payroll for France.

• Importing data from other payroll systems.

When you set up a reference period, you must define where employee payroll information is stored because this is required for distributing the global fund.

The amount that an employee receives from profit sharing can be based on one or more of these parameters:

• Gross salary.

• Days worked in the reference period.

• Number of eligible employees.

For the Distribute Global Funds process to calculate the profit share based on salary and days worked, it requires each employee's gross salary and total days worked during the reference period.

These values must take into account absences. Generally, absences reduce the employees' gross salary and the total working days for the period. However, the following types of absence must not be deducted from the employees' total working days count and their gross salary amount:

• Paid vacations.

• Maternity leave.

• Adoption leave.

• Work accidents (except accidents that occur on journey between home and workplace).

• Absence due to occupational illness (maladie professionnelle).

The gross salary includes all compensation and benefits, before contributions such as the social security contribution and retirement contribution are deducted.

See Computation Page.

This payroll information is imported from one of two sources:

• Global Payroll for France.

• A record in the database that has been populated from other payroll systems.

The system checks the employee's job data, as of the reference period end date, to determine which source to use for the import. If the Payroll System field on the Job Data - Payroll page is Global Payroll, the system imports from Global Payroll for France. If the Payroll field is set to any other value, the system imports from a record in the database.

Use the Reference Period page (WP_AGRT_PERIOD) to create and approve reference periods.

Navigation:

• Set Up HCM > Product Related > Compensation > Profit Sharing FRA > Reference Period > Reference Period

• Compensation > Profit-Sharing FRA > Review Reference Period > Reference Period

This example illustrates the fields and controls on the Reference Period page - Period tab. You can find definitions for the fields and controls later on this page.

This example illustrates the fields and controls on the Reference Period page - Carryover tab. You can find definitions for the fields and controls later on this page.

Use the Payroll Mapping page (WP_AGRT_PERIOD_SEC) to define payroll data required by the profit sharing calculations.

Navigation:

Click the Payroll Map button on the Reference Period page.

This example illustrates the fields and controls on the Payroll Mapping page. You can find definitions for the fields and controls later on this page.

Use this page to define the location of payroll information that is required for profit sharing. If you make changes to this page after running the Extract Eligible Employees process, you must rerun the process to take account of the modifications. You can't make changes to this page once the reference period status is Approved.