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OHAUA_INDEXATION_005 - Set Up Wage Types to Reduce Base for Indexation Payments

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In this Customizing activity, you set up the wage types that you use to reduce the base amount on which you calculate indexation payments for individual employees.

You reduce the base amount based on legal and customer-specific requirements, for example, in the following cases:

• An employee has jobs with different employers
  When an employee's second employer calculates indexation payments for the employee, it must deduct the employee's indexed income from his or her other job from the living wage. For more information, see the example below.

• An employee is absent or resigns
  For example, in your company, when employees hand in their notice, you reduce the amount on which you calculate indexation payments.

For more information about how the system uses the wage types that you set up in this Customizing activity, see the Indexation - Ukraine (UAIDX) function.

For the model wage types that you use to store an employee’s income on which indexation amounts have already been calculated, carry out the following steps:

1. If the wage type contains a payment amount that is relevant for calculating indexation amounts, in the Cumulations group box, select the checkbox for the Salary Indexation wage type.
2. Customize the wage types so that the system stores indexed income from the wage types in the Salary Indexation (/113) wage type in the Input (IT) table.
   To do this, choose a value of the Cumulation and Storage of Time Wage Types (3) or Cumulation and Storage at End of Gross Part (20) processing class that causes the system to store all indexed income in the Salary Indexation (/113) wage type in the Input (IT) table.

The system stores the Salary Indexation (/113) wage type in the Input (IT) table before the Indexation - Ukraine (UAIDX) function calculates indexation payments.

Assume that an employee has two jobs: one with a main employer and one with your company as a secondary employer.

In line with legislation, the employee's main employer calculates indexation payments for the employee's main job. When you calculate indexation payments for the employee's second job, you must deduct the employee's indexed income from his or her main job from the living wage.

In this Customizing activity, you set up the wage types that contain an employee’s indexed income from his or her main job. The system uses the wage types to reduce the base for calculating indexation payments by the indexed income from the employee's main job.

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