Calculating Gratuity Earnings

Gratuity (GRA) is a single payment to contract workers at the end of a contract or when a contractor leaves.

The calculation rule is Amount:

Amount is set at the payee level.

This section discusses how to:

  • Use generation control in gratuity calculation.

  • Use formulas in gratuity calculation.

Gratuity is paid to employees working on contract by using the generation control OE GC GRA. The system automatically pays gratuity based on the contract end date and resolves the amount using the generation control. When the employee is unable to finish the contract, the amount of the gratuity is prorated. No proration rule applies because of the many ways gratuity can be paid in Hong Kong. It is up to the organization to pay prorated gratuity when contract employees cannot finish the contract period.

While you enter gratuity at the earning assignment level, it is resolved once through generation control.

Gratuity earnings resolve if the contract end date occurs during the current pay period. If the contract end date is outside the current pay period, the gratuity is not paid. The OE FM CNTR EXPIRE formula determines whether the contract end date occurs during the current pay period and uses segment begin and end date so that the earnings are not paid twice during period segmentation.