2012 R3 CU8: Flexible Benefit Accruals

This is the fifth post in a series related to the new functionality introduced in Dynamics AX 2012 R3 CU8. Several new features were added in the HR and Payroll areas based on customer feedback. Features to be covered in the series include: Total compensation statement, FMLA tracking, Premium earning generation, Regular rate of pay, Benefit accrual enhancements, and Forecast position enhancements. Be sure to subscribe to updates for our blog to learn about this new functionality

Flexible benefit accruals

Currently in AX we have the ability to accrue benefits based on an hourly accrual.

This feature provides the Payroll administrator with additional flexibility as it relates to benefit accruals. We have added the ability to accrue based on specific earning codes, rather than all earnings as is the case today.

In addition to the accrual flexibility, we have also added the ability to accrue based on a specific frequency and the ability to accrue compensatory time.

Setup benefit accruals

Benefit accrual plans can be set up using rules that are used to determine how the benefit is accrued and used. Accrual method options now include hourly, payroll frequency, worker date, and Compensatory time. The steps for creating a benefit accrual plan are as follows:

1. Open the Benefit accrual set up form by going to Payroll > Setup > Benefits > Benefit accrual plans.
2. Click New on the action pane and enter the following plan information:

1. Benefit accrual plan:
2. Description:
3. Accrual rate basis:
4. Annual plan start date
5. If the plan allows balances to be carries forward at the end of the year

• Define the plan rules:

1. Months of service for each tier
2. The accrual rate or amount
3. The Maximum accrual limit
4. The minimum balance allowed in the plan (if users are allowed to go negative in the plan)

• Identify the earning codes that when used, will subtract time from the workers accrual plan balance.
• Identify the earning codes that when used, will add time to the workers accrual plan balance(if needed for the selected plan).
  

The second step is to define the date that will be used to calculate a workers months of service.

Navigate to Payroll > Setup > Parameters > Payroll Parameters to verify the field that will identify a worker’s months of service. Options include the workers’ seniority date or a custom date for each worker.

Enroll a worker in a benefit accrual plan

The process to enroll a workers is still the same, but there may be an additional step depending on the plan you select.

1. On the Area page, navigate to Common > Workers > Workers and select a worker. Once the record is highlighted, select Personal Information > Benefit accruals from the Action pane to open the Benefit accruals form. 
2. Click the New button to add a new benefit accrual plan for a worker. Once you select the plan, you can change the Service data basis from what is defaulted from the Parameters form, if desired. This will change the date used to calculate the years of service for this particular worker only.
   

Accruing benefit accrual time

As the worker meets the qualifications for the plan, they will accrue time in the specified plan.

Using the existing earning statement process, enter time for an earning code that has been designated to accrue time for the plan that the worker is enrolled in.

As earning statements are processed and released, that time will accrue for the worker. This can be seen by accessing the workers record and viewing their Benefit accruals form after the pay statement has been submitted.

Using benefit accrual time

Now that the worker has accrued time, they are eligible to use that time as desired.

Using the existing earning statement process, enter time for an earning code that has been designated to subtract time for the plan that the worker is enrolled in.

As earning statements are processed and released, that time will subtract for the worker. This can be seen by accessing the workers record and viewing their Benefit accruals form after the pay statement has been submitted.

Summary

This expansion of the existing benefit accrual functionality adds flexibility to account for varying situations that may occur within your business.