Two tiered calculation
Problem
I need to define a formula for a deduction or a benefit and I would like it tiered. How do I go about this?
Solution
Paymate uses Payroll Categories to define Earnings, Benefits, Deductions, Payroll Tax, Accrual, and miscellaneous items. When you define a formula deduction or a formula benefit, you may specify it as Two Tiered.
When you click on Two Tiered Calculation you will see 4 more fields:
· Annual Threshold
· % to apply to Lower Tier
· % to apply to Higher Tier
· Prorate Threshold
Example 1, if you specify
· The formula as 100% of all Earnings
· The Annual Threshold as $40000.00
· The % for Lower Tier as 2%
· The Higher Tier as 4.8%
· Prorate Threshold is checked
Then the calculation on a single payroll would look like this
· Employee is paid Monthly
· Employee has $4000.00 paid on January timesheet
· Threshold on this timesheet would be $3333.33 (Annual Threshold / Employee Pay Frequency)
· 2% of $3333.33 is $66.67
· 4.8% of $666.67 is $32.00
· Result would be $98.67
Example 2, if you specify
· The formula as 100% of all Earnings
· The Annual Threshold as $800.00
· The % for Lower Tier as 2%
· The Higher Tier as 4.8%
· Prorate Threshhold is unchecked
Then the calculation on a single payroll would look like this
· Employee is paid Monthly
· Employee has $4000.00 paid on January timesheet
· 2% of $4000.00 is $80.00
· Result would be $80.00
Program will use the lower tier percentage until the year-to-date of this category is reached to annual threshhold ($800.00), then the program will use the higher tier percentage.