Basic Objects and Structures in Personnel Administration

What Do You Require of an HR Management System?

Organizational assignment
Enterprise structure Personnel structure Pay scale structure Wage types User authorizations

Enterprise Structure

Structure of a company according to personnel administrative, reporting requirements, time management and/or payroll perspectives from the point of view of your own company.
How your employees are grouped This structure is in addition to the Organizational Management Structure

Enterprise Structure>Company Code

The company code represents the highest level of the enterprise structure. It is defined by a four-character, alpha-numeric code In Personnel Administration, the company code has the following control functions: The company code is used to generate default values for data entry, for example, an employee s payroll area. The company code is a selection criterion for reporting. The company code constitutes an authorization check unit. At the company code level, the following control features are assigned which are relevant for Personnel Administration: the default country key for the employee s personal data, address data, and bank data. a default value for the currency key for employee s basic pay. a language code for text output, for example, employee remuneration information. In general, the Financial Accounting (FI) implementation team will determine the legal entities necessary to develop your Administrative Structure. Each legal entity will be given a Company Code. How many Company Codes do you have?

Enterprise Structure>Personnel Area

Personnel areas divide a company code into sub-units. The personnel area is an organizational unit; according to a personnel administrative, reporting requirements, time management and payroll organizational point of view, a personnel area represents a delimited enterprise area. The personnel area has the following functions:
The personnel area is used to generate default values for data entry, for example, an employee s payroll area. The personnel area is a selection criterion for reporting. The personnel area constitutes an authorization check unit.

Enterprise Structure>Personnel Area

Examples of personnel areas might be major organization divisions, or major geographical divisions (Headquarters, East, West, etc.).

Enterprise Structure>Personnel Subarea

Personnel subareas are a subdivision of the personnel area. Organizational control of the main HR subareas, namely the pay scale and wage type structures and work schedule planning, takes place at the personnel subarea level. The personnel subarea has the following organizational functions: Specifying the country grouping; this controls the dialog for entering country-specific personnel data and the setting up and processing of wage types and pay scale groups in Payroll; within a company code, the country grouping must be unambiguous Assigning a legal entity to differentiate between the individual companies from a legal point of view It specifies groupings for Time Management. This enables you, for example, to set up work schedules, substitution types, absence types, and leave types on the basis of a specific personnel subarea. The personnel subarea is a selection criterion for evaluations. The personnel subarea is used to generate default values for pay scale area and pay scale type for an employee s basic pay. It specifies the public holiday calendar. Defining personnel subarea-specific wage types per personnel area It assigns a legal person for payroll.

Enterprise Structure>Personnel Subarea

Personnel subareas can also be subdivisions of the personnel area by function (i.e. human resources, finance) if employees in different locations have different holiday calendars because the countries, states, union contracts, or other entity has required this, each location will be in a different Personnel Subarea. For instance, the employees in Mandaluyong may get off for Liberation day, while the employees in part of Quezon City get off for Quezon City day. Mandaluyong would be in one Personnel Subarea and Quezon City in another.

Enterprise Structure>Organizational Key

The organizational key improves the enterprise structure and the personnel structure. You can use an organizational key to carry out a further organizational assignment for employees. The elements company code, personnel area and personnel subarea from the company structure, help to make up the organizational key. The organizational key is a part of the authorization check.

Personnel Structure
Describes an employee s position in a company from the individual employee s view. The personnel structure can be considered from two perspectives:
administrative perspective
Employee group Employee subgroup Payroll area Organizational key

organizational perspective
Position Job Organizational unit

Personnel Structure>Employee Group

Employee groups represent a primary subdivision of personnel. An employee group defines the extent to which its employees place their labor at the disposal of the enterprise. The Personnel Administration component makes a significant differentiation between active, pensioner and early retiree employee groups or may also be regular, proby, etc. The employee group has the following organizational functions:
Employee groups allow you to generate data entry default values, for example, for the payroll accounting area or an employee s basic pay. Employee groups serve as selection criteria for reporting. Employee groups constitute an authorization check unit.

Personnel Structure>Employee Subgroup

Employee subgroups subdivide employee groups. Within the employee group for active employees, for example, a distinction is made between the following employee subgroups: Hourly wage earners Monthly wage earners Pay scale employees Non-pay scale employees All of the control features for the personnel structure are defined at the employee subgroup level. The most important control features are as follows: You can standardize or differentiate how an employee is dealt with for a personnel calculation rule using the grouping of employee subgroups. For example, you can control whether an employee s remuneration is calculated on a monthly or hourly basis using this grouping. You determine which wage types are permissible for which employee subgroups using the employee subgroup grouping for the primary wage types. With the employee subgroup grouping for collective agreement provision you restrict the eligibility of pay scale groups, so that only certain pay scale groups are valid for specific employee subgroups.

Personnel Structure>Employee Subgroup

You determine which work schedules are permissible for which employee subgroups using the employee subgroup grouping for the work schedule. You determine which work schedules are permissible for which employee subgroups using the employee subgroup grouping for the work schedule. You can set up appraisal criteria dependent on employee subgroup using the employee subgroup grouping. The employee subgroup enables you to define data entry default values, for example, for the payroll area or an employee s basic pay. The employee subgroup is a selection criterion for evaluations. Employee subgroups are an authorization check unit.

Employee subgroups subdivide employee groups according to the employee s status. For instance the Company Employee Group can be subdivided into exempt and non-exempt status for overtime pay. Another Subgroup can divide employees who are paid on an executive pay scale from those paid on a salaried or hourly pay scale. Another Subgroup can be divided by how a particular collective bargaining agreement s provision affect which pay scales or time schedules are valid for which groups of employees. Employee subgroups also allow you to divide employees into different categories. (E.g. Active, Permanent, Part Time). Employee subgroups also used to determine security access and selection criteria for reporting, e.g. Staff, Senior Staff. In addition, these employee combinations will typically share the same payroll, benefits and time-related rules.

Personnel Structure>Payroll Area

The payroll area is an organizational unit in the Human Resources department which can be defined for a unified payroll area. The payroll area classifies all the employees for whom payroll runs at the same time. Typically, Payroll Accounting Areas used to divide the workforce into logical groups of employees. These groups are based on payroll frequency, start date of the payroll run and, sometimes, geographical locations and security access. The payroll schedule is tied to payroll areas. The specific dates for which the payroll runs are determined as follows: The general payroll period is stored as a period modifier for each payroll area. For example, payroll can be performed on a monthly, semi-monthly, bi-weekly, or weekly basis. The exact dates are stored for each valid accounting period. The exact dates of the current payroll period are determined by using the payroll control record, which contains the period for which the last payroll was run, and the next period for which the payroll will run.

Pay Scale Structure

Binds collective agreement elements with the primary aim of determining each remuneration according to the collective agreement. The pay scale structure is defined by the following elements:
Pay scale type Pay scale area Employee subgroup grouping for collective agreement provisions Pay scale group Pay scale level

Pay Scale Structure> Payscale Type

The pay scale type defines the area of economic activity for which a collective agreement is valid. The area in which it is valid may be determined at company or trade union level and often applies to a whole industry, for example, the chemical and metal processing industries or the civil service.

Pay Scale Structure> Payscale Area

The pay scale area defines the geographical area in which a collective agreement is valid. The geographical validity area is determined by the size of the pay scale area.

Pay Scale Structure> Payscale Group and Level

The pay scale area defines the geographical area in which a collective agreement is valid. The geographical validity area is determined by the size of the pay scale area. Pay scale groups and pay scale levels are the criteria used to classify data for job evaluations and indirect valuations. Pay scale levels are subdivisions of pay scale groups. You define pay scale groups and levels per country grouping, pay scale type, pay scale area and employee subgrouping grouping for the collective agreement provision