To create a standard earnings element for Gratuity (Flat Amount) in Oracle HCM, follow these steps:
1. Navigate to Setup and Maintenance:
- From the Home page, go to Setup and Maintenance under the Tools section.
2. Search for Manage Elements:
- In the search bar, type “Manage Elements” and select the Manage Elements task from the search results.
3. Create a New Element:
- In the Manage Elements page, click Create to start creating a new element.
4. Element Basic Information:
- Enter the following details:
- Primary Classification: Select Earnings.
- Secondary Classification: Choose Regular Earnings or Gratuity (depending on the available options in your system).
- Element Name: Name the element, such as Gratuity – Flat Amount.
- Reporting Name: Use the same name or a simplified version for reporting.
- Effective Date: Set the effective start date for the element.
5. Define Input Values:
- Specify the input values for the element. Since it’s a flat amount element, you’ll typically configure:
- Flat Amount: This will be the amount of gratuity paid out.
- You can also add additional input values if needed (e.g., comments, dates, etc.).
- If the flat amount is fixed for all employees, you can define a default value for this input.
6. Processing Rules:
- Define the element’s processing rules:
- Recurring or Non-Recurring: Choose whether this earning is paid regularly (recurring) or as a one-time payment (non-recurring). For gratuity, it’s often a non-recurring payment.
- Proration: Determine if proration applies if the employee works only part of the pay period (optional for a flat amount element).
- Final Close: Decide if the element should be processed during the employee’s final payroll, such as upon termination or retirement.
7. Costing (Optional):
- If the gratuity should be allocated to specific cost centers or accounts, configure the Costing options here. This is important if you need to track gratuity expenses separately.
8. Element Eligibility:
- After creating the element, you can define its eligibility. Choose who is eligible to receive this element:
- You can set eligibility criteria based on employee attributes such as job, department, location, or specific groups.
- Navigate to Manage Element Eligibility and assign the newly created element to the relevant group of employees.
9. Save and Close:
- After configuring all required options, click Save and Close to finalize the element creation.
10. Test the Element:
- To ensure the element is functioning correctly, assign the element to an employee through Manage Element Entries and input the flat gratuity amount. Run a sample payroll to validate the setup.