Select language:

Process documentation Calculation of WCB Premiums 

Purpose

For reporting and remittance reasons, it is necessary to know the WCB account to which the premium must be paid. Therefore, payroll cluster RK must contain WCB account and classification code information. To facilitate this requirement, standard WCB processing in mySAP HR Payroll contains the elements described below.

Process Flow

Standard WCB processing in mySAP HR Payroll contains the following elements.

Wage type series /1WA - /1WY (Workers’ Comp. Earnings)

Wage type series /4WA - /4WY (Workers’ Comp. Premiums)

The following table summarizes the use of wage type series /1WA through /1WY and wage type series /4WA through /4WY in the standard system.

Pr./
Ter.

Wage type

Contains the …

Wage type

Contains the …


AB


/1WA

base earnings used to calculate WCB employer payroll tax levied.

 

/4WA

premium established by Alberta WCB as employer payroll tax for WCB payments.


BC


/1WB

base earnings used to calculate WCB employer payroll tax levied.

 

/4WB

premium established by B.C. WCB as employer payroll tax for WCB payments.


NL


/1WF

base earnings used to calculate WCB employer payroll tax levied.

 

/4WF

premium established by Newf. & Labr. WHSCC as employer payroll tax for WCB payments.


SK


/1WK

base earnings used to calculate WCB employer payroll tax levied.

 

/4WK

premium established by Sask. WCB as employer payroll tax for WCB payments.


MB


/1WM

base earnings used to calculate WCB employer payroll tax levied.

 

/4WM

premium established by Manitoba WCB as employer payroll tax for WCB payments.


NB


/1WN

base earnings used to calculate WCB employer payroll tax levied.

 

/4WN

premium established by N.B. WHSCC as employer payroll tax for WCB payments.


ON


/1WO

base earnings used to calculate WCB employer payroll tax levied.

 

/4WO

premium established by Ontario WSIB as employer payroll tax for WCB payments.


PE


/1WP

base earnings used to calculate WCB employer payroll tax levied.

 

/4WP

premium established by P.E.I. WCB as employer payroll tax for WCB payments.


QC


/1WQ

base earnings used to calculate WCB employer payroll tax levied.

 

/4WQ

premium established by Quebec CSST as employer payroll tax for WCB payments.


NS


/1WS

base earnings used to calculate WCB employer payroll tax levied.

 

/4WS

premium established by N.S. WCB as employer payroll tax for WCB payments.


NU


/1WV

base earnings used to calculate WCB employer payroll tax levied.

 

/4WV

premium established by NWT / Nunavut WCB as employer payroll tax for WCB payments.


NT


/1WW

base earnings used to calculate WCB employer payroll tax levied.

 

/4WW

premium established by NWT/Nunavut WCB as employer payroll tax for WCB payments.


YT


/1WY

base earnings used to calculate WCB employer payroll tax levied.

 

/4WY

premium established by Yukon WCHSB as employer payroll tax for WCB payments.

In addition to series /1WA through /1WY (for assessable earnings) and series /4WA through /4WY (for premiums), the system uses a third wage type series — /1EA through /1EY — to store earnings in excess of the provincial maximum. This third series is described in detail below.

Example

Technical wage type /1WM contains the base earnings used to calculate the employer payroll tax to be levied for workers’ compensation purposes. These base earnings, multiplied by the employer experience rate, will determine the WCB assessable earnings contained in wage type /4WM.

The wage assessment ceiling for Manitoba is stored in payroll constant table T511K under payroll constant TWMBE. Employer experience rates for Manitoba and all other provinces are stored in table T5KWA.

If a wage type is to be included in this employer payroll tax, ensure that processing class 69 is configured accordingly.

In contrast, technical wage type /4WM contains the premium established by the Manitoba Workers’ Compensation Board as the employer payroll tax for WCB payments. The base earnings in wage type /1WM, multiplied by the experience rate, determine the WCB assessable earnings in this wage type.

The wage assessment ceiling for Manitoba is stored in table T511K under payroll constant TWMBE. Employer experience rates for Manitoba and all other provinces are stored in table T5KWA. The assessable earnings in wage type /1WM are displayed in the Workers’ Compensation Assessable Earnings Report, along with the corresponding provincial ceiling and employer experience rate.

Caution

Wage types in wage type series /1WA through /1WY do not carry over excess amounts. Excess amounts are carried over by wage type series /1EA through /1EY, described below. Only the maximum assessable earnings for the province or territory in question are stored in wage type series /1WA through /1WY.

Wage type series /1EA - /1EY (Workers’ Comp. Excess Amounts)

Once payroll ceases to cumulate amounts in wage type series /1WA through /1WY, it moves all excess amounts into wage type series /1EA through /1EY. Wage type series /1EA through /1EY therefore stores excess WCB amounts in the corresponding province or territory. No premium is calculated on amounts in this wage type series; all WCB premiums remain stored in wage type series /4WA through /4WY.

Example

Technical wage type /1EM contains all earnings that exceed the maximum assessable earnings defined for Manitoba by the Manitoba Workers’ Compensation Board. If the amount stored in technical wage type /1WM reaches the maximum assessable earnings ceiling, then the standard system creates /1EM to carry over all amounts in excess of that ceiling. While no premium is calculated on these excess amounts, the amounts themselves must still be reported.

Payroll cluster table WCB1

The Canadian payroll cluster RK contains a payroll table called WCB1. This table stores information that is relevant for the processing of WCB premiums, including the accounts, the classification codes, and the rates. The information contained in this table follows the tax split and therefore always corresponds to the same time intervals as table TAX1. The split of the WCB1 cluster table is equivalent to the CNTR1 split that is used for tax calculation.

The Display Cluster RK (Payroll Results Canada) program (RPCLSTRK) allows you to view table WCB1, and the payroll log also displays this table, where appropriate. Furthermore, payroll function PRINT allows data to be printed from this table, where appropriate.

Employment standard jurisdiction

WCB jurisdictions are stored in the Employment standard jurisdiction field in Tax Assignment infotype (0461). You are also at liberty to assign employees to another province or territory for WCB reasons by simply creating a new record for the employee in Infotype 0461. This action, however, changes the calculation of the WCB premium. If an employee is re-assigned to a different WCB jurisdiction during the pay period, then the premium will be calculated according to the split for both the old and the new assignment.

Payroll Driver

The Payroll Driver uses the following three functions for the calculation of WCB premiums:

KTXDM: Canadian Tax Infotypes Data Management

This payroll function create and populate cluster table WCB1 with all the information relevant to WCB premiums. Validation checks are performed to verify the consistency of the information. If the system finds errors, the employee is rejected.

P0221: Non-Authorized Manual Cheque

Function P0221 populates cluster table WCB1 in the event an adjustment run is performed.

KFTAX: Calculate Flat Taxes and Levies

The actual amount of the WCB premium in question is calculated here. Wage types /1WA through /1WY and /4WA through /4WY are also generated here. In case maximum assessable earnings are reached, then only wage types /1EA through /1EY are moved to the results table.

Example

Warren Reed is an employee of ABC Inc. working in Ontario from 2001-01-15 to 2001-01-28 and in Quebec from 2001-01-29 to 2001-01-31. Therefore, two records of Infotype 0461 are required for Warren in pay period 02/2001 (semi-monthly). Warren’s assessable income is $840 for the pay period. Maximum assessable earnings have not yet been reached in either province. Warren belongs to the company’s retail section. The retail rate for Ontario is $1.50, while for Quebec, it is $2.50. Given this scenario, Warren’s payroll results in tables RT and WCB appear as follows.

Table RT (pay period 2001-01-15 to 2001-01-31)

Abart

Wage type

Wage type text

Split indicator

Amount

*

/1WO

ON/Workers’ Comp. Earnings

01

$672.00

*

/1WQ

QC/Workers’ Comp. Earnings

02

$168.00

*

/1EO

ON/Workers’ Comp. Excess Earnings

01

$0.00

*

/1EQ

QC/Workers’ Comp. Excess Earnings

02

$0.00

3

/4WO

ON/Workers’ Comp. Premium

01

$10.08

3

/4WQ

QC/Workers’ Comp. Premium

02

$4.20

Table WCB (pay period 2001-01-15 to 2001-01-31)

Split

Class.

group

WCB juris.

Begin

End

WCB account

Class. code

Rate

01

0001

ON

2001-01-15

2001-01-28

2345532

4611

$1.50

02

0001

QC

2001-01-29

2001-01-31

93011537

81070

$2.50

 

Leaving content frame