Retrospective pay rate changes are applied by processing a Back Pay batch.

A Back Pay batch groups together paid timesheets requiring reprocessing against updated pay rates. There are two types of Back Pay batches:

• agreement batches

• payee batches.

Agreement batches update pay rates for a selection of pay agreements. All timesheets paid against the selected pay agreements since the effective date of the retrospective rate change are reprocessed against the new pay rates.

Payee batches update the hourly, extra hourly (for Nordic countries only) or the monthly pay rates of a selection of payees. Paid timesheets belonging to the selected payees processed since the effective date of the rate change are reprocessed against the new pay rates. Payee batches cannot be created for the country of Australia or New Zealand.

The diagram below summarises the stages involved in processing a Back Pay batch.

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Each stage of the Back Pay batch process is described below.

Initial Stage

During this stage of the process you are required to provide the information required to create the Back Pay batch, which is as follows:

• country

• batch type

• rate effective date

• adjustment reason.

The country of the batch determines which pay agreements or payees can be updated when the batch is processed. For example, if the batch is created for the country of Norway, the batch can include pay agreements or payees belonging to the country of Norway.

The batch type determines if the batch will reprocess all timesheets paid against selected agreements (agreement batch) or only those timesheets that belong to selected payees (payee batch). The Payee batch type is unavailable for the countries of Australia and New Zealand.

The rate effective date is the date to which the pay rate change is back-dated. The Back Pay process will adjust pay items and, optionally, bill items that fall on or after the rate effective date.

The adjustment reason explains why the retrospective pay rate adjustment is being applied. This is selected from a predefined list of adjustment reasons that is specific to your business.

Agreement Selection Stage

This stage of the process applies to agreement batches only and requires you to select the pay agreements to be included in the batch. All timesheets paid against the selected pay agreements on or after the rate effective date will be reprocessed.
At this stage of the process, you can select any pay agreement that meets all of the following conditions:

• belongs to the country of the batch, as selected during the initial stage of the batch process

• has one or more pay rate rules with a rate type of Fixed Rate.

Payee Selection Stage

This stage of the process applies to payee batches only and requires you to choose the payees whose hourly, extra hourly or monthly pay rate is to be retrospectively updated. Only those timesheets that belong to the payees you select at this stage of the process will be reprocessed within the Back Pay batch and only if the timesheets had been originally paid on or after the rate effective date of the batch.

Rate Selection Stage

This stage of the process requires you to specify the updated pay rates that apply as of the rate effective date.

When processing an agreement batch, you can update the pay rates defined by pay rate rules belonging to any pay agreement you chose to include at the agreement selection stage of the batch process.

When processing a payee batch, you can define a new hourly, extra hourly or monthly pay rate for payees you chose to include at the payee selection stage of the batch process.

Debtor Selection Stage

This stage of the process involves selecting the debtors who are to be rebilled so that the rate changes that will be affected by the back pay batch can be passed onto the debtors.

A debtor is available for selection at this stage of the process if a timesheet that was previously billed to the debtor will be automatically adjusted as a result of processing the back pay batch.

If a debtor is selected, the adjustment timesheets that are linked to that debtor will interpreted against the relevant bill agreements to generate adjusted bill amounts. This allows new invoices to be created and delivered via the Billing module. For example, the credit/rebill process can be used in the Billing module to credit out the original invoices and to create new, adjusted invoices that can be issued to the debtor to pass on the rate change.

Released Stage

During this stage of the process, the Interpreter service processes the Back Pay batch.

If the batch is an agreement batch, the following occurs as a result of the Interpreter processing the batch:

1. Applicable pay rate rules belonging to the pay agreements, which were selected at the agreement selection stage of the process, are expired (closed)

2. New pay rate rules are added to the selected pay agreements and the validity start dates of the pay rate rules are set to the rate effective date of the batch

3. Timesheets processed against the updated pay agreements since the rate effective date of the batch are reversed to negate any pay and, if applicable, bill items generated when the timesheets underwent pay and bill interpretation

4. Adjustment timesheets are created to replace the reversed timesheets and undergo pay and, if applicable, bill interpretation against the updated rates

5. The Interpreter sets the status of the batch to Closed, thereby preventing any further changes to the batch.

If the batch is a payee batch, the following occurs as a result of the Interpreter processing the batch:

1. The hourly, extra hourly or monthly pay rates of the payees, which were selected at the payee selection stage of the process, are updated as of the rate effective date of the batch.

2. Timesheets belonging to the updated payees that were processed since the rate effective date of the batch are reversed to negate any pay and, if applicable, bill items generated when the timesheets underwent pay and bill interpretation.

3. Adjustment timesheets are created to replace the reversed timesheets and undergo pay and, if applicable, bill interpretation against the updated rates.

4. The Interpreter sets the status of the batch to Closed, thereby preventing any further changes to the batch.

The difference between the pay amount of an original timesheets and that of the adjustment timesheet created by the Back Pay process is then used to determine by how much a payee's gross wage will be adjusted by the system to factor in the retrospective rate change.

Similarly, if the bill amount is to be adjusted, the system uses the difference between the bill amount of the original timesheet and that of the adjustment timesheet to determine the bill adjustment amount.