9.10.6 Pay Sequence Maintenance (09113m)

If you do not have an in-depth knowledge of payroll/award concepts, do NOT change anything.

As a security precaution we recommend that before you commence processing here you print off the Pay Sequence Report (9.10.7) in detail and retain a hard copy.

Before proceeding further, do you understand the employee awards and workplace agreements in operation for your business? Can you clearly identify all payment obligations that need to be paid under each award or agreement? Do not proceed until you do.

If you are ready to commence, print the 9.10.9 Employee Class/Pay Sequence Report. Compare the employee types defined against the employee.

All payment items payable under award/agreements need to be created in the Master Pay Sequence table.

All items that go to make up a payrun are referred to as Pay Sequences ie: hourly rates, day rates, weekly rates, monthly rates, piece rates, meal Sequence, travelling Sequence, tool Sequence, wet under foot etc. They also include "on cost" items such as pay accruals and deduction items such as tax etc.

When setting up codes it should be noted that once a code is Deleted it is "Marked for Deletion" and cannot be reused or "un-deleted".

The Sequence codes are divided into the following group areas which coincide with the time sheet input screen (Menu Item 9.1)

• Questions 5 to 7 determine the rate that will be applied, therefore giving the value of Item 8.
• Questions 9 - 11 determine the quantity to be used in the calculation.

To demonstrate the setting up of a Sequence code, we will use the example of a code for "Apprentice Training".

In this case the procedure to follow is:

1. Pay Sequence No. (refer to Muli Code 521 for primary breakup). Because Apprentice Training will be paid as unproductive hours, the code must be inserted in the Sequence group 1000 - 1999. Training is normally in the range 1500 - 1599 and as an example Sequence code 1501 will be used. You can use the F3 Enquire key for a pop-up list to choose from if you want to change one of the existing ones.
2. Description. A short description of the Sequence's use is required to a maximum length of 32 characters. For our example - "Apprentice Training" will suffice.
3. Note Help - 501
4. Units or Process type - 524
5. Normal Quantity - Should always be "1" representing one measure.
6. Base pay sequence for Rate calculation
7. Factor for Adjustment - If a code was inserted under Item 6 you can insert an adjustment factor ie: half or double of the rate applicable to the code inserted in Item 6 above. For our example, because we did not insert a code in Item 6, it will automatically skip over this item.
8. Value for Adjustment - As per Item 7, except the adjustment can be done in dollars and cents as opposed to a percentage.
9. Normal/Calculated Rate - If a code was entered in Item 6 it will automatically insert that rate in this item. You have the opportunity to either put a hourly, daily, weekly rate in this item OR you put "1" which then tells the machine to go to the employees file and pay the normal rate.
10. Pay Sequence for Quantity - As per Item 6 except that this Item tells it to look at the quantity and not the pay rate. For our example, leave blank (space bar once and return).
11. Use Quantity or Extension - If a code is not inserted in Item 10, it will automatically skip this Item. If a code is inserted in Item 10 then enter either "Q" for Quantity or "E" for Extension of the rate of the code you have inserted in Item 10. For example if an overtime Sequence is being created, then the code for the trade rate would be inserted in Item 10 and you would select Q for Quantity (which is adjusted in Item 12). For our example Muli will automatically skip this item. 
12. Factor for Adjustment - Represents the amount of times you want Item 9 multiplied by. Example: If a time and a half Sequence was being created the factor for adjustment would be 1.5. For our example a factor of "1" is required.
13. Include for Income Accumulator - Yes/No - This Item is for PAYG Payment Summary purposes (ie Group Certs.). If this Sequence is a monetary item for the employee, then it is an income item - response is Y - Yes. For example an RDO accrual is a non income item. For our example the response is "Y" - Yes.
14. Include for Taxation Accumulator - Yes/No.
15. Include for Superannuation Accumulator - Yes/No. [For all items used in calculating the 9% superannuation obligation in Australia]. 
    Normally answered Yes unless the code you are creating does not have a direct bearing on the accrual or payment of employee's superannuation example: tax deduction. For our example the response is "Y" - Yes.
16. Include for Other accumulator - Yes/No
17. Print on Pay Packets? - Choices are: Y - Yes or N - No. Accruals or provisions are not printed on the employee's pay packet, but for our example the response is "Y" - Yes.
18. Link Code 523 - The 523 code is used to indicate additional control information.
    

    N = Nil
    C = Requires Accounting interface (to allow costs/recovery to GL)
    D = Requires Direct Deposit and Accounting
    E = Education item, requires Accounting
    J = Direct job cost item, requires Accounting
    W = May have Accounting

19. PAYG Group Summary Sequence 522 (updated Oct. 2010)
    

    A - Lump Sum A 
    Unused long service leave that accrued after 15/8/93 OR 

    Unused holiday pay and other leave related payments that accrued before 16/8/93 OR 

    Unused long service leave accrued after 15/8/78 or unused holiday pay or related payments, where the amount was paid because the payee ceased employment under an approved early retirement scheme because of an invalidity or because of a bona fide redundancy.

    B - Lump Sum B 
    Unused long service leave that accrued before 16/8/78. Only 5% is taxable.

    D - Lump Sum D 
    Genuine redundancy payment or approved early retirement scheme payment below the tax-free threshold. This amount is not taxable and should not be included on the individual's income tax return.

    E - Lump Sum E 
    Back payment that accrued more than 12 months ago. All of this amount is taxable but an offset may be available.

    Z - Allowances

    G - All wages etc (ie annual leave loading)

    T - Tax taken from wages and salaries

    N - Not on PAYG Payment Summary

20. State Payroll Tax Group 526
21. Timesheet Control 537
22. Usage control 200
23. Allocation
24. Pay sequence used to find Labour order

The following have additional data maintenance to allow further calculations:

K = Child Support DD + additional costs

Child Support (in Australia) - Allowance code 010 Link 523 Flag K. The principle of Child Support is that a company is given a “Notice of Child Support Deductions or Notice Pursuant to Section 72A”. This will normally state a deduct child support value of $xyz that is related to the employee's normal pay period. You should also be advised of the PEA (Protected Earnings Amount) and this normally changes each year for January.

Method of Calculation - Take the balance remaining

Gross Pay -Tax (all S) + salary sacrifice = Net Pay for CS

Deduct PEA Amount = Balance available

Value of CS is the lowest of Child Support Value OR Balance Available

With Muli Payroll, this would normally be set up as a Direct Deposit value.

L = Leave item accounting + details for Leave calculations

[Leave Item - Pay allowance B000 - B998. For detailed discussion refer to 9.10.1 Pay Leave Maintenance.]

R = Superannuation “Direct Deposit”, Accounting + DD + additional costs

S = Superannuation Accounting + additional Super controls

R&S - Superannuation - R indicates payment by Direct Deposit rather than by group superannuation scheme. Note: Salary Sacrifice (Q000 - Q998) is calculated on values in the Employee Allowance Maintenance section.

Employer Contributions (X000 - X998) There is no employee override

Superannuation Maintenance Screen

Superannuation Organisation Code

T = Tax calculation item + Accounting

Tax Calculation - In real life tax may be calculated under two scenarios - Fixed % OR by tax schedule. All allowance codes with the Tflag require the Tax Office provided data to be entered into the schedule to allow the required calculation to occur. Normally we would not expect supported Australian users to update the tax rules file, as this would be done as part of Muli support.

Each tax calculation requires the following data to be completed.

• Pay Allowance Code
• Tax Calc Rule = AUS (only at this time)
• Start Date
• Earning less day/week x x x
• a xxx
• b xxx

Tax is then calculated on the Tax Accumulator Value of the payment

Less annual offset amount *pay days/360 = Value used for calculation.