©© 2013 SAP AG. All rights reserved.

Scenario/Processes

Payroll ServicesScenario Overview

Posting and Closing

Collecting/Transferring Payroll Input Data

Processing Payroll Calculation

Initiating Payment

Performing Statutory Reporting

Scenario Explorer

Open Legend

HR Administrator

Scenario Description

The following business roles are involved in this scenario:

Click process chevrons for details

Defining Compensation Policy

Preparing Payroll Process

Defining Employees’ Compensation

Maintaining Employees’ Payroll Data

The Payroll Services business scenario is designed to efficiently support the payroll process with an external payroll system. Payroll Services combines the advantages of an internal payroll – transparency, monitoring, and controlling – with the advantages of an outsourced payroll - lower costs, higher efficiency, and lower risk of liability. In the Business Process Outsourcing (BPO) scenario of Payroll Services, the payroll provider takes care of tax calculations and remittance, and initiates the salary payments to employees, thereby reducing your administrative overhead.

Additionally, Payroll Services enables you to validate a preview of all payroll input data within the payroll snapshot before it is transferred to your payroll provider. This allows you to correct the data when necessary, giving you full control over the payroll before the payroll calculation has started.

Business Value

Scenario Flow

Further Information

©© 2013 SAP AG. All rights reserved.

Scenario/Processes

The Payroll Services business scenario is designed to efficiently support the payroll process with an external payroll system. Payroll Services combines the advantages of an internal payroll – transparency, monitoring, and controlling – with the advantages of an outsourced payroll - lower costs, higher efficiency, and lower risk of liability. In the Business Process Outsourcing (BPO) scenario of Payroll Services, the payroll provider takes care of tax calculations and remittance, and initiates the salary payments to employees, thereby reducing your administrative overhead.

Additionally, Payroll Services enables you to validate a preview of all payroll input data within the payroll snapshot before it is transferred to your payroll provider. This allows you to correct the data when necessary, giving you full control over the payroll before the payroll calculation has started.

Payroll ServicesScenario Overview

HR Administrator

Scenario Description

The following business roles are involved in this scenario:

Click process chevrons for details

Open LegendOpen Legend

<Role Name><Role Name> <Role Name>

Legend

Process mainly driven by the user

Process mainly driven by the system

Manual process not supported by the system

Process that communicates with third-party software (mouse-over for details)

Process with relevance to Financials

Related scenario

Info button with more information

Close Legend

Business Value

Scenario Flow

Further Information

Posting and Closing

Collecting/Transferring Payroll Input Data

Processing Payroll Calculation

Initiating Payment

Performing Statutory Reporting

Defining Compensation Policy

Preparing Payroll Process

Defining Employees’ Compensation

Maintaining Employees’ Payroll Data

Scenario Explorer

©© 2013 SAP AG. All rights reserved.

Scenario/Processes

Defining Compensation Policy with Compensation Structure

Payroll Services Process Details: Defining Compensation Policy

Scenario Explorer

Process Description

Maintain compensation structure and assign compensation components

Maintain compensation components

Performed byHR Administrator

In the Work CenterCompensation

Further Information

X

i i

Click process chevrons for details

Posting and Closing

Collecting/Transferring Payroll Input Data

Processing Payroll Calculation

Initiating Payment

Performing Statutory Reporting

Preparing Payroll Process

Defining Employees’ Compensation

Maintaining Employees’ Payroll Data

Click here to display process variant

The HR administrator plans and designs the compensation for employees using appropriate reward strategies based on predefined compensation structures and components. The administrator sets up the compensation structures and is also responsible for changes and adjustments: adapting point- and range-based compensation structures by maintaining grades, amounts, and minimum and maximum amounts. Basic elements in compensation are compensation components, comprising:

• Salaries or wages

• Regular earnings or deductions

• One-time earnings or deductions

The HR administrator also creates point- and range-based compensation structures for all employee groups, enabling grouping of employees based on their compensation packages. Compensation structures increase transparency for your company compensation policies and allow analysis of compensation across various employee groups.

Business Value

Scenario Flow

Further InformationSee alsoCompensation BasicsCompensation Structures

©© 2013 SAP AG. All rights reserved.

Scenario/Processes

Defining Compensation Policy with Compensation Structure

Payroll Services Process Details: Defining Compensation Policy

Scenario Explorer

Process Description

Maintain compensation structure and assign compensation components

Maintain compensation components

Further Information

X

i i

Click process chevrons for details

Posting and Closing

Collecting/Transferring Payroll Input Data

Processing Payroll Calculation

Initiating Payment

Performing Statutory Reporting

Preparing Payroll Process

Defining Employees’ Compensation

Maintaining Employees’ Payroll Data

Click here to hide process variant

Defining Compensation Policy without Compensation Structure

i

The HR administrator plans and designs the compensation for employees using appropriate reward strategies based on predefined compensation structures and components. The administrator sets up the compensation structures and is also responsible for changes and adjustments: adapting point- and range-based compensation structures by maintaining grades, amounts, and minimum and maximum amounts. Basic elements in compensation are compensation components, comprising:

• Salaries or wages

• Regular earnings or deductions

• One-time earnings or deductions

The HR administrator also creates point- and range-based compensation structures for all employee groups, enabling grouping of employees based on their compensation packages. Compensation structures increase transparency for your company compensation policies and allow analysis of compensation across various employee groups.

Performed byHR Administrator

In the Work CenterCompensationBusiness Value

Scenario Flow

Further InformationSee alsoCompensation BasicsCompensation Structures

©© 2013 SAP AG. All rights reserved.

Scenario/Processes

Payroll Services Process Details: Preparing Payroll Process

Scenario Explorer

Process Description

In the Work CentersPayroll Processing Compensation

Further Information

Click process chevrons for details

Defining Compensation Policy

Defining Employees’ Compensation

Maintaining Employees’ Payroll Data

Preparing PayrollProcess

Check mapping tables

Schedule future payroll processes

X

i i

The HR administrator schedules regular payroll runs according to the payroll periods (for example, bi-weekly, semi-monthly) of the different payroll groups. Depending on the planned payroll run date, the administrator creates the payroll periods, plans the payment dates, the payroll period start and end dates, and the cut-off dates – the latest dates that payroll-relevant data must be entered in the ByDesign system to ensure its inclusion in the payroll run.

The HR administrator is also responsible for smooth communication between the ByDesign system and the payroll provider system. This role includes ensuring that the mapping tables of pay types to provider pay types, time types to provider times types, and time account pay types to provider time account types are correctly maintained and up-to-date in the ByDesign system.

Performed byHR Administrator

Business Value

Scenario Flow

Further Information See alsoPayroll Run Quick Guide

Posting and Closing

Collecting/Transferring Payroll Input Data

Processing Payroll Calculation

Initiating Payment

Performing Statutory Reporting

©© 2013 SAP AG. All rights reserved.

Scenario/Processes

Payroll Services Process Details: Defining Employees’ Compensation

Scenario Explorer

Process Description

Click process chevrons for details

Preparing Payroll Process

Maintaining Employees’ Payroll Data

Defining Employee Compensation with Compensation Structure

X

Assign compensation structure and grade to employees

Maintain compensation according to compensation structure

Maintain deductions

i i i

Click here to display process variant

The HR administrator maintains all employee salary changes and adjusts the assignment of compensation structures and grades: adding new compensation components or maintaining amounts for earnings or deductions as required.

In the Work CenterCompensation

Further Information

Business Value

Scenario Flow

Further Information See alsoSynchronize Employee Data

Posting and Closing

Collecting/Transferring Payroll Input Data

Processing Payroll Calculation

Initiating Payment

Performing Statutory Reporting

Defining Compensation Policy

Performed byHR Administrator

©© 2013 SAP AG. All rights reserved.

Preparing Payroll Process

Posting and Closing

Collecting/Transferring Payroll Input Data

Processing Payroll Calculation

Initiating Payment

Performing Statutory Reporting

Defining Compensation Policy

Scenario/Processes

Payroll Services Process Details: Defining Employees’ Compensation

Scenario Explorer

Process Description Further Information

Click process chevrons for details

Maintaining Employees’ Payroll Data

Defining Employee Compensation with Compensation Structure

X

Assign compensation structure and grade to employees

Maintain compensation according to compensation structure

Maintain deductions

i i i

Click here to hide process variant

Defining Employee Compensation without Compensation Structure

i

The HR administrator maintains all employee salary changes of employees and adjusts the assignment of compensation structures and grades: adding new compensation components or maintaining amounts for earnings or deductions as required.

Business Value

Scenario Flow

Further Information See alsoSynchronize Employee Data

Performed byHR Administrator

In the Work CenterCompensation

©© 2013 SAP AG. All rights reserved.

Scenario/Processes

Payroll Services Process Details: Maintaining Employees’ Payroll Data

Scenario Explorer

Process Description Further Information

Click process chevrons for details

Defining Employees’ Compensation

Maintaining Employees’ Payroll Data

Maintain payroll group assignment

Maintain payment data

Maintain tax and/or social insurance data

X

i i i

X

During the payroll hire process, the HR administrator maintains employees’ payroll data, such as the payroll group assignment, payment information, and additional information for further bank accounts. According to country-specific regulations, tax and/or social insurance data for employees is also maintained.

In the Work CenterPersonal AdministrationBusiness Value

Scenario Flow

Further Information See alsoSynchronize Employee Data

Posting and Closing

Collecting/Transferring Payroll Input Data

Processing Payroll Calculation

Initiating Payment

Performing Statutory Reporting

Preparing Payroll Process

Defining Compensation Policy

Performed byHR Administrator

©© 2013 SAP AG. All rights reserved.

Scenario/Processes

Payroll Services Process Details: Collecting & Transferring Payroll Input Data

Scenario Explorer

Process Description Further Information

Click process chevrons for details

Posting and Closing

Processing Payroll Calculation

Initiating Payment

Performing Statutory Reporting

XCollecting Payroll Input Data and Transferring Data usingFile Download and Automated Upload

View warnings and error messages from provider. Update/resend snapshot as necessary

Transfer data file to payroll provider

Create and download data file

Check and correct snapshot data. Recreate snapshot as necessary

Create snapshot

iiiii

Click here to display process variants

X

The Business Process Outsourcing (BPO) scenario for a regular payroll run in the ByDesign

environment begins with the collection of all new or changed payroll, compensation, and time data into a payroll snapshot, which is then systematically validated for inconsistencies. Errors in the snapshot data are identified by the ByDesign system for the HR administrator to view and correct, followed by re-creation of the snapshot as required. Once the snapshot data is complete and accurate, an XML file is created, downloaded, and transferred to a third-party payroll provider .

The different variants in this process are dependent on how the data are brought into the payroll provider’s system. In all variants, it is essential that the complete process of snapshot creation and transfer to the provider is repeatable.

In the Work CenterPayroll ProcessingBusiness Value

Scenario Flow

Further Information

See alsoExpense Report Notification to Payroll ProcessingPayroll Processing with DATEV (DE only)

Defining Compensation Policy

Preparing Payroll Process

Defining Employees’ Compensation

Maintaining Employees’ Payroll Data

Performed byHR Administrator

©© 2013 SAP AG. All rights reserved.

Collecting Payroll Input Data and Transferring Data usingFile Download and Automated Upload

Scenario/Processes

Payroll Services Process Details: Collecting & Transferring Payroll Input Data

Scenario Explorer

Process Description Further Information

Click process chevrons for details

X

Click here to hide process variants

Collecting Payroll Input Data and Exporting Data via Automated Messaging (currently not supported)

Collecting Payroll Input Data and Exporting XML Data Converted to Exceli

i

View warnings and error messages from provider. Update/resend snapshot as necessary

Transfer data file to payroll provider

Create and download data file

Check and correct snapshot data. Recreate snapshot as necessary

Create snapshot

iiiii

The Business Process Outsourcing (BPO) scenario for a regular payroll run in the ByDesign

environment begins with the collection of all new or changed payroll, compensation, and time data into a payroll snapshot, which is then systematically validated for inconsistencies. Errors in the snapshot data are identified by the ByDesign system for the HR administrator to view and correct, followed by re-creation of the snapshot as required. Once the snapshot data is complete and accurate, an XML file is created, downloaded, and transferred to a third-party payroll provider .

The different variants in this process are dependent on how the data are brought into the payroll provider’s system. In all variants, it is essential that the complete process of snapshot creation and transfer to the provider is repeatable.

Business Value

Scenario Flow

Further Information

See alsoExpense Report Notification to Payroll ProcessingPayroll Processing with DATEV (DE only)

Defining Compensation Policy

Preparing Payroll Process

Defining Employees’ Compensation

Maintaining Employees’ Payroll Data

Posting and Closing

Processing Payroll Calculation

Initiating Payment

Performing Statutory Reporting

Performed byHR Administrator

In the Work CenterPayroll Processing

©© 2013 SAP AG. All rights reserved.

Scenario/Processes

Processing Payroll: Gross-to-NetCalculation Performed by Payroll Provider

Payroll Services Process Details: Processing Payroll Calculation

Scenario Explorer

Process Description

In the external payroll provider system

Further Information

Click process chevrons for details

Validate payroll results. Update snapshot when necessary

Run payroll

ii

X

Click here to display process variant

Performed byPayroll Provider

The payroll provider processes payroll and checks payroll results for completeness and correctness. The provider ensures that the calculation of tax and social insurance contributions meets the relevant country-specific regulations.

If the payroll results are not correct because of invalid data sent to the provider from the ByDesign system, this data must be corrected and a snapshot of the data re-created. A new data file is then created in the ByDesign system and transferred to the payroll provider.

Business Value

Scenario Flow

Further InformationSee alsoQuick Guide for Work (in Payroll Processing)

Defining Compensation Policy

Preparing Payroll Process

Defining Employees’ Compensation

Maintaining Employees’ Payroll Data

Posting and Closing

Initiating Payment

Performing Statutory Reporting

Collecting/Transferring Payroll Input Data

©© 2013 SAP AG. All rights reserved.

Scenario/Processes

Payroll Services Process Details: Processing Payroll Calculation

Scenario Explorer

Process Description Further Information

Click process chevrons for details

The payroll provider processes payroll and checks payroll results for completeness and correctness. The provider ensures that the calculation of tax and social insurance contributions meets the relevant country-specific regulations.

If the payroll results are not correct because of invalid data sent to the provider from the ByDesign system, this data must be corrected and a snapshot of the data re-created. A new data file is then created in the ByDesign system and transferred to the payroll provider.

In the external payroll provider system

Performed byPayroll Provider

Processing Payroll : Gross-to-Net Calculation Using Automated Messaging

(currently not supported)

Business Value

Scenario Flow

Further InformationSee alsoQuick Guide for Work (in Payroll Processing)

Processing Payroll: Gross-to-NetCalculation Performed by Payroll Provider

Validate payroll results. Update snapshot when necessary

Run payroll

ii

X

Click here to hide process variant

Posting and Closing

Initiating Payment

Performing Statutory Reporting

Collecting/Transferring Payroll Input Data

Defining Compensation Policy

Preparing Payroll Process

Defining Employees’ Compensation

Maintaining Employees’ Payroll Data

©© 2013 SAP AG. All rights reserved.

Defining Compensation Policy

Preparing Payroll Process

Defining Employees’ Compensation

Maintaining Employees’ Payroll Data

Scenario/Processes

Payroll Services Process Details: Initiating Payment

Scenario Explorer

Process Description Further Information

Click process chevrons for details

Processing Payroll Calculation

Initiating Payments

Transmit bank transfer file

Create bank transfer file

ii

X

Click here to display process variants

The payroll provider initiates salary payments to the employees. How this process is done is provider-dependent. In this scenario, one example of a possible payment initiation process performed by the provider is illustrated. Three alternative variants to this example process are also shown.

In the external payroll provider system

Performed byPayroll Provider

Business Value

Scenario Flow

Further InformationSee alsoQuick Guide for Work

Posting and Closing

Performing Statutory Reporting

Collecting/Transferring Payroll Input Data

©© 2013 SAP AG. All rights reserved.

Defining Compensation Policy

Preparing Payroll Process

Defining Employees’ Compensation

Maintaining Employees’ Payroll Data

Processing Payroll Calculation

Initiating Payments

Transmit bank transfer file

Create bank transfer file

ii

X

Click here to hide process variants

Posting and Closing

Performing Statutory Reporting

Collecting/Transferring Payroll Input Data

Scenario/Processes

Payroll Services Process Details: Initiating Payment

Scenario Explorer

Process Description Further Information

Click process chevrons for details

The payroll provider initiates salary payments to the employees. How this process is done is provider-dependent. In this scenario, one example of a possible payment initiation process performed by the provider is illustrated. Three alternative variants to this example process are also shown.

In the external payroll provider system

Performed byPayroll Provider

Business Value

Scenario Flow

Further Information

Check Printing and Dispatch

Bank Transfer via Customer

Bank Transfer to Employees from Provider’s Bank Account

See alsoQuick Guide for Work

©© 2013 SAP AG. All rights reserved.

Scenario/Processes

Payroll Services Process Details: Performing Statutory Reporting

Scenario Explorer

Process Description

For this statutory process, the payroll provider:

Performs statutory reporting for tax and social insurance

Prints forms for employees (for example, remuneration statements)

Prints forms for authorities (for example, contribution statements)

Transfers data to authorities according to country-specific regulations

Further Information

Click process chevrons for details

Initiating Payment

Performing Statutory Reporting

Run required statutory reports for tax and social insurance

Create formsTransmit data to authorities

iii

X

In the external payroll provider system

Performed byPayroll Provider

Business Value

Scenario Flow

Further InformationSee alsoProducing Statutory Reports

Processing Payroll Calculation

Collecting/Transferring Payroll Input Data

Posting and Closing

Defining Compensation Policy

Preparing Payroll Process

Defining Employees’ Compensation

Maintaining Employees’ Payroll Data

©© 2013 SAP AG. All rights reserved.

Scenario/Processes

Payroll Services Process Details: Posting and Closing

Scenario Explorer

Process Description

The HR administrator extracts payroll posting data from the payroll provider system and posts payroll results generated by the provider into General Ledger. In a final step, he closes the payroll period.

In the Work CenterPayroll Processing General Ledger

Further Information

Click process chevrons for details

Performing Statutory Reporting

Posting and Closing

Extract payroll posting data from provider system

Upload data into General Ledger

Close payroll period

iii

X

Business Value

Scenario Flow

Further InformationSee alsoTransferring Payroll Results to Accounting

Initiating Payment

Processing Payroll Calculation

Collecting/Transferring Payroll Input Data

Performed byHR Administrator

Defining Compensation Policy

Preparing Payroll Process

Defining Employees’ Compensation

Maintaining Employees’ Payroll Data

©© 2013 SAP AG. All rights reserved.

Initiate

Maintaining Employee Compensation

Maintaining Employee Payroll Data

Payroll Services Business Value

Scenario Explorer

Overview

This scenario is ideal for HR executives in midsize companies who need to set up and manage scalable, accurate, and efficient payroll processes in a country-compliant manner.

You can deploy workforces regionally or internationally, control payroll costs, perform company-wide compensation planning, and improve the accuracy of your company’s time reporting.

SAP Business ByDesign integrates compensation planning and time recording into payroll processing and allows for accounting records to be updated.

Support for global payroll outsourcing so that payroll is run accurately, on time, and in compliance with country regulations

Recording functions that are integrated with project management and financials to simplify resource allocations, payments, and profitability analysis

Automated payroll processing that reduces the costs of HR services

Tight integration of outsourced payroll for optimized collaboration and efficient communication with payroll provider

Key Benefits

Run

Collecting/Transferring Payroll Input Data

Processing Payroll Calculation

Initiating Payment

Settle

Performing Statutory Reporting

Post to Ledger

Business Value

Scenario/Processes

Scenario Flow

Further Information

©© 2013 SAP AG. All rights reserved.

Initiating Payment

Collecting/Transferring Payroll Input Data

Processing Payroll Calculation

Payroll Services Scenario Flow Variant: Payroll Services

Legend

Work center in which process is performed

Business document flow

Process related to Financials

Related scenarios

Process mainly driven by the user

• Process variant1

• Process variant 2

Scenario Explorer

Work Center

Additional Application

• File Download and Transfer to Provider

• Using XML Data File with Excel Conversion

• Automated Messaging

• Salary Payments on Behalf

• Check Printing• Bank Transfer File• Salary Payments from

Payroll Provider Bank

• Gross-to-Net Calculation by Payroll Provider

• Gross-to-Net Calculation via Automated Messaging

Defining Compensation Policy

Defining Employees’ Compensation

Maintaining Employees’ Payroll Data

Workforce Administration

Time and Labor Management

Expense Reimbursement

Preparing Payroll Process

Performing Statutory Reporting

Posting and Closing

Financial Closing

Compensation

Organizational Management/

Payroll Processing

Payroll Processing

Personnel Administration

External Payroll

Processing

Payroll Processing

General Ledger

External Payroll

Processing

External Payroll

Processing

Process communicating with third-party software

• With Compensation Structure

• Without Compensation Structure

• With Compensation Structure

• Without Compensation Structure

Business Value

Scenario/Processes

Scenario Flow

Further Information

©© 2013 SAP AG. All rights reserved.

Payroll ServicesFurther Information

Scenario Explorer

ForumGet in touch with experts to discuss your specific requirements. To enter the community, click here.*

More DetailsSAP provides a complete product documentation, covering all aspects of the business scenario. For more details, click here.

Self-Enablement SystemsIf you want to try out the business scenario, click here.*

WIKIIn addition to the product documentation, SAP provides Wikis that describe additional aspects of SAP Business ByDesign. To access the WIKI, click here.*

Do you want to try it out? Do you need more information? Do you want to discuss with others?

VV

* Note that to access the links above you need to have a user in SAP Business Center. If you cannot access the page directly and if you are using Microsoft Internet Explorer®, please check http://support.microsoft.com/kb/890474.

Further Information

Business Value

Scenario Flow

Scenario/Processes