Proration of Leaves

[mamajid]

Dear All

Can any one tell how to assign exact number of leaves to an employee hired in the middle of the month of lets say may or june or july where payroll period in from jan to dec. Let me clear the scenario in following

An employee Mr. ABC hired on 17th of May in a company. Payroll period is from Jan to Dec. He is to be assigned 20 Annual Leaves along with other leaves. What would be the procedure/Steps to assign him exact number of leaves. If a formula is to be written then what would be its type or if it is done through proration then what would be the proration steps. Or any other solution.

Waiting ur replies.

Regards

Majid.

[eng_ahmad_2007]

Dear Majid,

For this scenario, you just need to perform two steps:
1) Give the employee initial leave balance through feeding directly to an element that feeds the accrual plan.
2) Define an Accrual Plan, Link it to an Accrual Calculation Formula which calculates (with seeded proration) the actual amount deserved throught the year. You can assign the leaves total, frequency, carry over limit, and other parameters to this formula.

Feel free to ask, and I hope this helped..

Best Regards,

Ahmad Ghanem

[mamajid]

Dear Ahmed

First thanks for reply.

Secondly, I haven't find any seeded formula in write formula. I have also seen try to analyze a column of proration in proration tab of Element form.

I didn't understand how will oracle do proration by itself through accrual calculation formula.

If will be thankful if u please elaborate.

Regards

Majid.

[eng_ahmad_2007]

Dear Majid,

You are most welcome. You can use formulas of type "Accrual" such as: "PTO_HD_ANNIVERSARY_BALANCE". This formula is for calculating accrual for Hire Date Anniversary. You can assign:
* Accrual Ceiling.
* Accrual Rate.
* Accruing Frequency.
* Accrual Multiplier.
Inside the formula, you can notice many "IF's". This is to handle the proration of accrual as per hire date, termination, and eligibility for the accrual plan.

If you are still confused, feel free to post.

Kind Regards,

Ahmad Ghanem

[mamajid]

Thanks Ahmed for reply.
Your answer, as i have understood is more inclined towards accrual. My problem is related to first time assignment of leaves as i mentioned in my first question. Mr. ABC hired on 17th of May. His Annual leave entitlement is 20 per payroll calender year (Jan-Dec). What i did till yet is as follows.

1- I created an element name Annual Leave (non recurring) with input value 'Days'.
2- Created its Link.
3- I write a simple fast formula for proration of annual leave. Formula classification is Payroll Run Proration. It calculates annual leaves according to hire date. If employee hired on 1st Jan then he will get 20 days and if employee hired in middle of year then he will get leaves accordingly. Here is a logic for reference i wrote.

20/365 * (31-DEC-YYYY - Hire_date) = Number of annual leaves assigned.

4- I attached this formula in Proration Tab of element.

From here onwards i am confused how and where it will assigned leaves as this classification formula doesn't appear in formula result too.

Any Idea...?

Regards

Majid.

[eng_ahmad_2007]

Dear Majid,

You are most welcome dear . Well, let's differentiate between two things:

1) Creating an accrual plan that automatically handles employees' leaves and proration.
2) Even the employee is on accrual plan, he needs to be assigned Initial Leave balance, which is handled through element creation and linking to Accrual Plan.

Now, which of the two is your requirement?

If it is (1), then refer to my section in the above-mentioned blogs for the Accrual Plan.

If it is (2), and you need further explanation, just tell me.

Also, actually, I never used the way you mentioned in your previous post for element annual leave and proration ( I mean why create a Fast Formula for proration, while Accrual Plan handles this?). Also, if you still want to use your solution, have you added the element to the employee through element entries?

I hope this clarifies all.

Best Regards,

Ahmad Ghanem

[mamajid]

Dear Ahmed

With your reply i got the main point which i guess is missing is absence balance type.

1- Increasing
2- Decreasing

In increasing we do not need to initialize balance and there fore after definition of accrual plan the formulas in accrual plan will take care of proration (please correct me if i am wrong)

If i am using decreasing balance i need to initialize absence balance in element entries window for a particular employee or in default value in element input value. Below is the quote i am pasting from oracle document for clarification.

<b>"If the absence type has an increasing balance, this is the sum of all absences that end on or before the effective date. If the absence type has a decreasing balance, the running total shows the amount remaining from the initial balance after deducting all absences that end on or before the effective datEven the employee is on accrual plan, he needs to be assigned Initial Leave balance, which is handled through element creation and linking to Accrual Plan.e."
</b>

We are using decreasing balance <span id='hl' style='background-color: yellow'><i><i>(yours point 2:"Even the employee is on accrual plan, he needs to be assigned Initial Leave balance, which is handled through element creation and linking to Accrual Plan.")</i></i></span id='hl'> of leaves where we need to initialize balance for particular employee. And if the employee is being hired in the middle of a month then proration is required. Thats why i created the formula and attached it with leave element.

I hope you got my point.

Regards

[eng_ahmad_2007]

Dear Majid,

For the part of increasing balance, I agree. Absence elements with increasing balance are usually set up for accrual plan usage. Well, even though, sometimes, you still need to use an element to initialize balance because you want to deal with opening balances for employees (leaves carried over from previous years before the implementation started).

For the decreasing part, you don't need to define a formula and proration. ALL what you need to do is to go to element entry and give a value for the Absence Element (Initial Balance). Note that this initial balance should be prorated (you already calculated how many days the employee is eligible for in this year). Also, notice that decreasing balance requires more maintenance, since for any new hire, you should feed with prorated initial balance and also for all employees, their balances need to be reset each year.

Well, my recommendation is to go with the first increasing solution, define an accrual plan and assign it to your employee and all calculations and proration should be handled automatically. FOR THE FIRST INITIAL BALANCE (before implementation), just define an element that will capture the value and enter it in the NET CALCULATION RULES in the accrual plan.

I hope I helped and all is clear now. If you are still confused, feel free to post.

Kind Regards,

Ahmad Ghanem

[mamajid]

Thanks Ahmed

I guess the picture has become quit clear to me regarding which option to be adopted and how to get on with it.

Thanks again

Regards

Majid.

[eng_ahmad_2007]

Dear Majid,

You are most welcome. I am glad I could help.

Kind Regards,

Ahmad Ghanem

[ramya.pabba123]

Dear Majid,


I was going through the topic and i have the same requiremnet of setting up accrual plan for decreasing balance .But I am getting some issues.

So If you have done the setup for decresing balance could you please help me out in seeting up the plan.

Regards
Ramya