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VC_T7EG02 - Define EOS Calculation Rules

VC_T7EG02 - Define EOS Calculation Rules

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In this activity, you define the rules that the system uses when calculating end of service (EOS) payout or provision.

Enter a unique identifier and description for each of your EOS calculation rules. Then, under End of Service Calculation Rule Attributes, specify the parameters that the system must use for each of your rules.

When defining your parameters, consider the following options that you have:

  • Determe whether a given payment is supposed to be made one time only, or based on the service duration. In the latter case, you can determine different EOS compensation slabs for different service duration ranges. When processing the rules, the system takes the information from the Minimum Service Duration field sequencially to build up the different slabs.
  • Define if the payment is to be in a fixed amount, a percentage of the EOS base, or proportional to a number of days.
  • Group together the rule conditions using the Rule Group field. This enables you to include different conditions for the same service duration.

Assume that you are adding entries for three different EOS compensation slabs based on the employee's years of contribution:

Service Duration Compensation Amount
<1 year Fixed amount of EGP 700
1 to 5 years 0.5 month per contribution year
>5 years 1 month per contribution year

You would enter the following data:

Rule Group Min.Durat Factor Paymt Type Amount Crcy
0 0 One Time Payment Fixed Amount 700 EGP
1 1 Per Duration Unit Percentage of EOS Base 0.50 EGP
1 6 Per Duration Unit Percentage of EOS Base 1 EGP

Presuming that you have configured the service duration unit as years, your settings mean the following:

  • Every employee terminated gets EGP 700, regardless of service duration.
  • The employee gets 0.5 month's worth of salary for each year of service, until the 5th year. This is delimited by the different rows grouped together in rule group 1. The first states that the minimum service duration is 1 year. It goes on successively for each subsequent year of service, until the system encounters the next entry, which is 6.
  • From the 6th year onwards, the employee gets 1 month's worth of salary per year of service. Since the system does not find any subsequent condition under rule group 1, it takes the 6th year rule for every subsequent year of service past the 6th.

So, for an employee with 8 years of service and an EGP 10000 monthly salary, processing those rules mean a total EOS compensation of EGP 55700. Here is the breakdown:

Payout Years Total
700 - 700
5000 5 25000
10000 3 30000

You can further customize the solution so that it takes different slabs for the same service contribution ranges. For example:

Rule Group Min.Durat Factor Paymt Type Amount Crcy
0 1 Per Duration Unit Fixed Amount 300 EGP
0 6 Per Duration Unit Fixed Amount 700 EGP
1 1 Per Duration Unit Percentage of EOS Base 0.50 EGP
1 6 Per Duration Unit Percentage of EOS Base 1 EGP

With those settings, you are telling the system to do the following:

  • From 1 to 5 years, pay EGP 300 and 0.5 month's worth of salary per year of service
  • From 6 years onwards, pay EGP 700 and 1 month's worth of salary per year of service





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