Extra Period Calculation

With PeopleSoft Global Payroll for Spain, you define the earnings that contribute to an extra period and the percentage of each earning. For example, you can define an extra period that consists of 100 percent of the monthly base salary and 50 percent of the employee's monthly transport complement.

For employees whose salary is adjusted gross to net or net to gross, you also define the extra period value as a percentage of the agreed monthly salary. If you define the percentage as 100, the employee's extra period is equal to the agreed monthly salary, regardless of the earnings defined in the extra period. If the extra period is 60 percent of the agreed monthly salary, the system calculates the absorbable complement based on this reduced monthly amount.

You define the percentage using the Percent if Salary Adjustment field on the Extra Period Definition page.

See Extra Period Definition Page.

To calculate the absorbable complement for the employee's extra period, the system:

  1. Multiplies the agreed monthly salary by the percentage adjustment specified for the extra period (Percent if Salary Adjustment field on the Extra Period Definition page). This gives the gross extra period amount.

  2. For each earning defined for the extra period, the system multiplies the earning amount by the percentage defined for that earning in the labor agreement (Earning Percent field on the Extra Period Eligibility Earnings page).

  3. Calculates the total of all the earnings calculated in step 2.

  4. Calculates the difference between the extra period amount calculated in step 1 and the total earnings for the extra period calculated in step 3. This is the absorbable complement for the extra period.

Note: For net-to-gross adjustments, the calculation of extra periods is part of an iterative process. For each iteration, the resulting net amount is compared with the agreed net amount. If it does not match, a new gross salary is calculated and the resulting net amount recalculated until it matches the agreed net amount.

Calculation Example

This example explains how the system calculates the employee's salary and extra periods when the extra periods are not based on 100 percent of earnings:

Note: To make understanding the calculation easier, this example uses monthly values. However, the system actually uses daily values in the calculations.

Salary details

Values

Agreed annual income

50.750,00 EUR

Earnings defined in the labor agreement for the employee's professional category

Base salary: 500 EUR/month

Transport complement: 200 EUR/month

Extra periods (defined in the labor agreement)

Extra Period 1:

Earnings and Earnings Pct: Base salary 50%, Transport 40%

Pct if Salary Adjustment: 50%

Extra Period 2:

Earnings and Earnings Pct: Base salary 100%, Transport 50%

Pct if Salary Adjustment: 100%

Extra Period 3:

Earnings and Earnings %: Base salary 80%

Pct if Salary Adjustment: 100%

To calculate the monthly agreed salary, the system:

  1. Divides the agreed annual salary by the total number of payment periods, taking into account the extra periods:

    50.750 / 14,5 (12 + 0,5 + 1 + 1) = 3.500 EUR /month

  2. Calculates the monthly salary according to the labor agreement:

    Total monthly income per labor agreement: 500 + 200 = 700 EUR/month.

  3. The system then calculates the difference between the agreed monthly gross amount and the monthly gross amount according to the labor agreement:

    3.500 – 700 = 2.800 EUR

    This is the amount of the monthly adjustment or absorbable complement that the employee receives in addition to the base salary and annual complement stated in the labor agreement.

To illustrate how the system calculates the extra periods for this employee, consider extra period 1 as an example. The system:

  1. Calculates the gross extra period amount by multiplying the agreed monthly salary by the percentage adjustment (50%) specified for the extra period:

    3.500 * 0,5 = 1.750,00

  2. Calculates the value of all the earnings included in the extra period by multiplying the earning by the earning percentage:

    Base salary = 250 EUR (500 * 0,5) and Transport = 80 EUR (200 * 0,4)

  3. Calculates the total of the earnings for the extra period: 250 + 80 = 330 EUR

  4. Calculates the absorbable complement by subtracting the total earnings (step 3) from the gross extra period amount calculated in step 1:

    1.750 — 330 = 1.420,00 EUR

Thus the employee's extra period is made up of earnings for base salary and transport and the absorbable complement.

This table summarizes the calculations of all extra periods for this employee:

Period

Earnings

Amount per Month

Earnings Percentage

Earnings Amount

Extra Period Amount

1

Base

500

50%

250

1.750 (250 + 80 + 1.420) = 50% of agreed monthly salary

Transport

200

40%

80

Absorb. Complement

1.420

2

Base

500

100%

500

3.500 (500 + 100 + 2.900) = 100% of agreed monthly salary

Transport

200

50%

100

Absorb. Complement

2.900

3

Base

500

80%

400

3.500 (400 + 3.100)) = 100% of agreed monthly salary

Absorb. Complement

3.100

The employee's annual salary is summarized in the following way:

Regular periods = 12 * 3.500 = 42.000 EUR
Extra periods = 1.750 + 3.500 + 3.500 = 8.750 EUR
Total Annual Salary = 42.000 + 8.750 = 50.750 EUR