Multi-period Payroll V12.30

This release introduces support for Multi-period Payroll (MPP) functionality in the Payroll module. MPP functionality allows a normal pay batch, which corresponds to the current (open) pay period, to include any unpaid/unprocessed historical timesheets and other pay transactions for any prior period in addition to timesheets and pay transactions that correspond to the current pay period.

The introduction of MPP functionality means that it is no longer necessary to process a separate adjustment pay batch for every prior pay period for which there are unpaid timesheets or transactions that are yet to be processed.

MPP replaces the interim solution that was available in prior versions of FastTrack360 that allowed a pay group to be configured so that late timesheets (i.e. unpaid timesheets for prior, closed pay periods) could be paid in a normal pay batch for the current, open pay period (for more information, see Removal of Include Prior Periods Pay Group Option). MPP expands on that functionality by:

allowing any type of unpaid/unprocessed transaction, not just late timesheets, to be processed in a pay batch for the current period, without the need to process separate adjustment pay batches for each respective adjustment period
facilitating payment of any type of payee, not just contractors who are not subject to tax, in a single pay batch by attributing tax, leave payments, leave accruals and other payroll-related transactions to the relevant corresponding pay periods where applicable
allowing manual pay items to be added to a payee’s earnings for the current or any prior period in which the payee belonged to the pay group of the pay batch.

How Does MPP Work?

When a normal (non-adjustment) pay batch is created for the current (open) pay period, any payee who belongs to the pay group, as at the end date of the current pay period, is now included in the pay batch by default if they have any unpaid/unprocessed transactions that correspond to the following:

the current pay period
any prior pay period during which they belonged to pay group of the pay batch.

For a list of the specific transaction types that trigger the automatic inclusion of a payee in a pay batch, see Pay Batch Creation Enhancements.

Payees who do not have any unpaid timesheets or outstanding transactions that require processing are excluded from the pay batch by default. However, they can be added into the pay batch at the Manual Items stage when the batch has been created if necessary.

At the Manual Items pay batch stage, manual pay items can be added for any date within or prior to the current pay period during which a payee belonged to the pay group of the pay batch.

At subsequent pay batch stages, the system processes any outstanding transactions related to that specific pay batch stage. For example, at the Leave Payments stage the system will pay any outstanding leave requests, irrespective of whether the leave requests relate to the current pay period or a prior pay period, assuming the conditions for paying the leave requests are met.

The table below summarises the main changes that apply to each pay batch stage because of the introduction of MPP functionality.

Pay Batch Stage	Changes
Manual Items	Payees can be added into the pay batch manually. For normal pay batches: unprocessed transactions from prior pay periods are automatically included in the pay items to be paid in the batch (for more information, see Pay Batch Creation Enhancements) manual pay items can be added for the current pay period or any prior pay period during which a payee belonged to the pay group of the pay batch payees who have no outstanding transactions to be processed can be added to the pay batch (for more information, see Adding Payees into a Pay Batch).
Rolled-up Holiday Pay	This is a new pay batch stage that allows payees to be paid an additional amount on top of their normal earnings in lieu of taking paid leave. For more information, see Rolled-up Holiday Pay Batch Stage.
Leave Accrual	The order of this stage has been moved to before the Leave Payments stage. Leave is accrued based on earnings/time worked for all periods that are included in the pay batch for each payee, not just earnings/time attributable to the current pay period. Each period in the pay batch for which there is a leave accrual is processed in chronological order and, where the conditions for transferring accrual into entitlement are met, the accrued leave is transferred into entitlement before the system continues to accrue for the next period. On drilling down into the pay details of an individual payee, automatic leave accrual transactions that have been triggered in the pay batch are grouped by the pay period to which the transactions correspond. For more information, see Leave Accrual Pay Batch Stage - Payee Pay Details Enhancements.
Leave Payments	The order of this stage has been moved to after the Leave Accrual stage. Unprocessed leave requests are paid irrespective of whether the leave requests correspond to the current pay period or a prior pay period. Leave accruals are topped up or recalculated to factor in leave that must be accrued on leave paid in the current pay batch. For more information, see Top-up and Recalculation of Leave Accruals. On drilling down into the pay details of an individual payee, leave payment transactions that have been triggered in the pay batch are grouped by the period to which the transactions correspond. For more information, see Leave Payments Pay Batch Stage - Payee Pay Details Enhancements.
Termination	Payees whose employment has been terminated in a prior pay batch or prior period can be included in a MPP pay batch to facilitate making payments after leaving. For more information regarding employment termination and MPP functionality, see MPP and Employment Termination below.
Auto Enrolment	Unenrolled payees are not automatically enrolled in a pension scheme if they have an employment termination date, irrespective of whether they have unpaid timesheets in the current pay batch that belong to prior periods that predate the payee’s termination date. That prevents terminated payees from being enrolled in a pension scheme if will no longer be engaged by the agency after the end of the current pay period.
Gross Deductions	Deductions that are configured to deduct a fixed amount per pay period are automatically applied once for each pay period if: the payee has transactions for the period in the pay batch the deduction has not already been applied for the period. Deductions that are configured to deduct a percentage of earnings per period are calculated or recalculated for each period for which the payee has earnings in the pay batch. Ad-hoc deductions that are manually added at this stage are applied to the open period to which the pay batch corresponds. On drilling down into the pay details of an individual payee, deductions of the same type are grouped together irrespective of the period to which they correspond. For more information, also see Enhancements to Applying Closed Deductions for Prior Period Payments.
HMRC Deductions	HMRC deductions are calculated on all rateable earnings on the pay batch, irrespective of whether the earnings belong to the current or a prior period.
Net Deductions	Deductions that are configured to deduct a fixed amount per pay period are automatically applied once for each pay period if: the payee has transactions for the period in the pay batch the deduction has not already been applied for the period. Deductions that are configured to deduct a percentage of earnings per period are calculated or recalculated for each period for which the payee has earnings in the pay batch. Ad-hoc deductions that are manually added at this stage are applied to the open period to which the pay batch corresponds. On drilling down into the pay details of an individual payee, deductions of the same type are grouped together irrespective of the period to which they correspond. For more information, also see Enhancements to Applying Closed Deductions for Prior Period Payments.
VAT	For VAT registered contractors, VAT is calculated on top of unpaid earnings for all periods, irrespective of whether the earnings belong to the current or a prior period. VAT on reimbursements is calculated for unpaid reimbursement items included in the pay batch, irrespective of whether they belong to the current or a prior period.
Wage Costs	Employer wage costs are calculated on all rateable earnings included in the pay batch, irrespective of whether the earnings belong to the current or a prior period.
Review	No specific changes have been made to this stage.

MPP and Payroll Reporting

Existing payroll reports that are available in the Payroll module can be run be run by pay period date ranges. Because a pay batch can now include payments for multiple periods, when running a payroll report by a pay period date range, the specified date range may only include part of the payments that were processed in a given pay batch, since a pay batch may include any number of periods. It is important to take this into consideration when running payroll reports in this release onward.

MPP and Employment Termination

There are some implications of the new MPP functionality that you must be aware of regarding terminating employment.

Leave Accruals Triggered by Leave Service

If a payee’s employment is terminated part-way through a pay period and the payee accrues leave that is triggered via the Leave Service, the payee may accrue leave for the entire final pay period during which they are employed, irrespective of whether they actually worked the full period. Therefore, a manual adjustment may need to be made to the payee’s leave balance at the Leave Accrual pay batch stage to reduce their final accrual accordingly.

To prevent this, an employment end date and termination reason can be selected directly on the Payroll > Payee > Payee Entry screen to terminate the payee’s employment, thereby preventing the need to terminate the payee in a pay batch.

Prior Period Termination Date

When a payee is terminated in a pay batch, the employment termination date must fall in the current period irrespective of any prior period transactions that might be included in the same pay batch for that payee. Therefore, if the employment termination date must be backdated to a prior pay period, the employment end date and termination reason must be selected directly on the Payroll > Payee > Payee Entry screen as opposed to at the Termination stage in a pay batch.

Payments Post Termination

If a payee is paid in a pay batch after their employment termination date, leave accruals will not cease automatically post the termination date. Because of this, it is important that any payments that are made post termination are paid using pay codes that are not included in leave Accrual Rules for any Leave Types that are configured in the Leave module.

Adjustment Pay Batches

The introduction of MPP functionality means that it will no longer be necessary to process adjustment pay batches (pay batches for prior, closed periods). The exceptions to that are as follows:

when processing balancing payments
when processing earlier tax year to date adjustments.

Because of this, changes have been made to how adjustment pay batches are processed. For more information, see Changes to Adjustment Pay Batches V12.30.