Payment Method (SAP Library

Payment Method

Definition

The method used to calculate partial period factors.

Use

If the payment method is employed, the employee is remunerated for the period actually worked or for paid absences. The constant for the flat-rate period working time is used as the divisor.

If the payroll is run for monthly periods, the general divisor determines that each calculation unit (hour or day) has the same value, irrespective of whether the period is a short or long month.

The payment method is suitable for use in the following situations:

The employee has many unpaid absences.

The actual length of the period is not different from the general length of the period (for example, weekly payment).

The payment method is not suitable to use in the following situations:

Payroll is run for an employee on a monthly basis (monthly or half-monthly) and the employee has only few unpaid absences.
In long months (for example, July) remuneration could be calculated and the amount could exceed the basic remuneration amount for the period, despite the absences.
In short months (e.g. February) an employees remuneration is reduced too much even if there are few absences.
Partial payments must be calculated for exact periods.

The employee would receive an amount that is different from the remuneration amount for the period because the number of hours or days does not correspond to the average.

Structure

The partial period factor is calculated as follows:

Factor = (planed working time - absence) / general period working time

You can use the average values typical for your particular country, industry, or company as general period working time.