benefits user guide

Benefits Administration User Guide

Version 8.0.3May 2002

Document Number BNUG-803UW-01

Human Resources

Lawson Software, Inc., believes that the information described in this manual is accurate and reliable, andmuch care has been taken in its preparation. However, no responsibility, financial or otherwise, can beaccepted for any consequences arising out of the use of this material, including loss of profit and indirect,special, or consequential damages. No warranties extend beyond the program specification.

The customer should exercise care to assure that use of the software and related documentation is in fullcompliance with the laws, rules, and regulations of the jurisdictions in which it is used.

These materials are confidential unpublished works of Lawson Software, Inc. Contents of this publicationare copyrighted and cannot be reproduced in any form without the written permission of Lawson Software,Inc. The information contained herein is subject to change. Revisions may be issued from time to time,and Lawson Software, Inc., assumes no responsibility to advise customers of changes or additions.

All brand or product names mentioned herein are trademarks or registered trademarks of LawsonSoftware, Inc., or the respective trademark owners.

© 2002 Lawson Software, Inc.

All rights reserved

Printed in the United States of America

Contents

List of Figures 13

Chapter 1 Using This Guide 17User Guide Conventions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17Product Documentation .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21Global Support Center. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21Documentation Contact . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21

Chapter 2 Benefits Administration Overview 23Benefits Administration Process Flow .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23Benefits: The Big Picture. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24Benefits Administration Integration with other Applications. . . . . . . . . . . . . . . . . . . . 25

Chapter 3 Benefits Administration Setup Overview 27

Benefits Administration Setup Overview..... . . . . . . . . . . . . . . . . . . 29Benefits Administration Setup Step-by-Step . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29

Chapter 4 Setup: BN Company 33

Concepts in this Chapter.. .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35What is a Benefit Company?. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35What are COBRA Occurrence Types? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35What is Reportable Group Term Life Insurance? .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36

Procedures in this Chapter .... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37Defining BN Company .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37Defining COBRA Parameters .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39Defining COBRA Occurrence Types .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41Defining Excess Life Insurance Rates .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42

Chapter 5 Setup: BN Preliminaries 45

Concepts in this Chapter.. .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46What are Annual Limits? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46What is a Vesting Schedule? .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46What is a Frequency Table? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47What is a Benefit Process Order?. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48

Benefits Administration User Guide Contents 3

Procedures in this Chapter .... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49Defining Annual Limits. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49Defining Insurance Carriers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50Defining Vesting Schedule . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51Defining Frequency Tables. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52Defining BN Process Order . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52Defining Postal Code Tables. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53

Chapter 6 Setup: Flex Plan 55

Concepts in this Chapter.. .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56What is a Lawson Flex Plan? .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56What are Flex Credits and Flex Credit Records?.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57When do I Define Flex Credit Records? .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58How are Flex Credits Issued and Structured? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58What Happens to Unspent Flex Credits?. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59

Procedures in this Chapter .... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60Defining Spending Account Only Flex Plans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61Defining Full Flex Plans .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62Defining Flex Credits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64Defining Flex Salary Parameters .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67Defining Flex Credit Rate Tables .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69Defining Flex Credits Based on Age .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72Defining Flex Credits Based on Years of Service.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74Defining Flex Credits Based on Dependents. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75Defining Flex Credits Based on Lifestyle . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76

Chapter 7 Setup: Benefits Plan 79

Concepts in this Chapter.. .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 81What is a Plan Type? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 81What are Benefit Categories? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 81What are Some Basic Plan Type Characteristics? .. . . . . . . . . . . . . . . . . . . . . . . . . . . . 82What are Coverage Types? .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 84What are Contribution Types? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 85What Contribution and Coverage Types Work Together? .. . . . . . . . . . . . . . . . . . . . 87How are Deductions used by Benefit Plans? .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 88What is a Default Plan? .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 89What Determines Eligibility? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 90Why Use Employee Groups with Benefit Plans? .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 90What are Waive Plans? .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 91What are Flex Core Plans? .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 92What are Benefit Dates? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 92

Procedures in this Chapter .... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 93Defining Benefit Categories .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 94

4 Contents Benefits Administration User Guide

Defining a Primary Benefit Plan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 95Defining Vesting and Covered Compensation Information . . . . . . . . . . . . . . . . . . .104Defining Investment Options. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .107Overriding General Ledger Accounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .108

Chapter 8 Setup: Benefit Entry Rules 113

Concepts in this Chapter.. .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 115What are Benefit Entry Rules? .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .115How are Entry and Re-entry Rules Defined? .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .115What are Entry Points? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .115

Procedures in this Chapter .... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 117Defining Entry Rules .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .117

Chapter 9 Setup: BN Plan Coverage 121

Concepts in this Chapter.. .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 123What are Benefit Salaries?. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .123What is a Coverage Reduction Table?.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .124When would I use Coverage Options? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .124When would I use Coverage Amounts? .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .124

Procedures in this Chapter .... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 125Defining Coverage Options .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .125Defining Coverage Amounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .129Defining Coverage Salary Parameters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .135Defining Coverage Reduction Table .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .138Defining Coverage Limits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .140

Chapter 10 Setup: BN Plan Contributions 147

Concepts in this Chapter.. .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 149How do I Define Benefit Contributions? .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .149What are the Differences between the Contribution Types? . . . . . . . . . . . . . . . . .150How are Contributions Calculated? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .153When Do I Use Rate Tables? .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .155How are Company Match Contributions Calculated? . . . . . . . . . . . . . . . . . . . . . . . . .155What are Flex Plan Contributions?.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .156

Procedures in this Chapter .... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 157Defining Contribution Rate Tables. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .158Defining Options Amount. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .165Defining Options Amount Range .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .170Defining Flat Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .173


Defining Salary or Coverage Rate Table . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .177Defining Contribution Limits. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .180Defining Match Limit Schedules . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .186Defining Match Percent Schedules . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .190

Chapter 11 Setup: Automation Rules 195

Concepts in this Chapter.. .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 197What are Benefit Automation Rules? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .197When Do I Use Add Rules?.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .197When Do I Use Change Rules? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .198When Do I Use Termination Rules?. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .199What is a Nested Employee Group? .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .200How Do I Use Employee Groups with Automation Rules? . . . . . . . . . . . . . . . . . . .200

Procedures in this Chapter .... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 202Defining Add Rules . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .202Defining Change Rules . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .205Defining Termination Rules .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .207

Chapter 12 BN Enrollment: Enrolling Employees in FlexPlans 211

Concepts in this Chapter.. .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 213What is a Flex Credit Record?. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .213What are Flex Periods? .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .213When is a Standard Time Record Created by a Flex Plan? .. . . . . . . . . . . . . . . . .214

Procedures in this Chapter .... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 215Automatically Create EE Flex Credit Records . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .215Manually Create EE Flex Credit Records .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .217

Chapter 13 BN Enrollment: Enrolling Employees in BenefitPlans 221

Concepts in this Chapter.. .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 223How do I Enroll Employees into Benefit Plans? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .223What is an Eligibility Date?. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .223What is a Start Date? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .224What Happens When I Override Salary? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .224

Procedures in this Chapter .... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 225Generating Benefit Enrollment Forms .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .225Enrolling Employees Automatically into Default Plans .. . . . . . . . . . . . . . . . . . . . . . .226Manually Enrolling an Employee into Multiple Plans .. . . . . . . . . . . . . . . . . . . . . . . . .230Enrolling Multiple Employees Manually. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .235


Enrolling Dependents. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .240Assigning Beneficiaries to a Plan.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .241Assigning Savings Bond Beneficiaries.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .241

Chapter 14 BN Enrollment: Maintain Employee Enrollments 243

Concepts in this Chapter.. .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 245What are Benefit Change Audit Records?.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .245What are Stop Dates? .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .246How does Lawson Process Benefits? .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .246What Must I Consider When Manually Changing a Flex Benefit? . . . . . . . . . . .247How Do I Make Flex Mid-Year Changes? .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .247What Happens when I Stop Benefits Using Automation Rules? . . . . . . . . . . . . .248What Happens when I Change Benefits Using Automation Rules? . . . . . . . . .249What Happens When I Add Benefits Using Automation Rules? . . . . . . . . . . . . .250

Procedures in this Chapter .... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 251Holding or Deleting Benefit Change Records .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .251Updating Automatically Based on Benefit Automation Rules .. . . . . . . . . . . . . . .253Updating Automatically for Age, Salary, or Years of Service . . . . . . . . . . . . . . . . .256Stopping EE Benefits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .259Manually Changing EE Benefits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .260Changing Flexible Spending Accounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .262Changing Flex Credits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .264Changing Dependent Benefits. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .266

Chapter 15 BN Enrollment: COBRA 267

Concept in this Chapter ... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 269Who is a COBRA participant? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .269

Procedures in this Chapter .... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 270Defining a COBRA Participant. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .270Enrolling a COBRA Participant . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .272Changing COBRA Participant Benefits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .274Adding a Second Occurrence or Tracking COBRA Dates .. . . . . . . . . . . . . . . . . . .275Notifying or Terminating COBRA Rights .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .277Generating COBRA Notification Letters .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .277Canceling COBRA Coverage for Delinquent Payments .. . . . . . . . . . . . . . . . . . . . .278

Chapter 16 BN Enrollment: Retiree 281

Concept in this Chapter ... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 282Who is a Retiree? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .282

Procedures in this Chapter .... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 283


Enrolling Retirees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .283Changing Retiree Benefits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .285Canceling Coverage for Delinquent Payments .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .286

Chapter 17 Plan Maintenance: Benefit Plans 287

Concepts in this Chapter.. .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 288Why would I Change My Benefit Plans?.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .288How does Lawson Track Benefit Plan Changes? . . . . . . . . . . . . . . . . . . . . . . . . . . . . .288What Statuses Does Lawson Track? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .290

Procedures in this Chapter .... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 291Updating Coverage Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .291Updating Contribution Information .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .292Updating Frequency Table Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .293Attaching a Different Frequency Table . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .294Updating GL Overrides . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .294Viewing Records Requiring Updating . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .295Updating Enrollment for Plan Changes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .296Updating Enrollment for Frequency Table Changes. . . . . . . . . . . . . . . . . . . . . . . . . . .298Terminating or Replacing a BN Plan .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .300Deleting a Coverage Option from a Benefit Plan .. . . . . . . . . . . . . . . . . . . . . . . . . . . . .302

Chapter 18 Plan Maintenance: Vacation Buy and Sell 303

Procedure in this Chapter .... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 304Update Employee Vacation Balances. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .304

Chapter 19 Plan Maintenance: Spending Account Balances 307

Procedure in this Chapter .... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 308Tracking Spending Account Reimbursements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .308

Chapter 20 Plan Maintenance: Stock Purchase Update 311

Procedures in this Chapter .... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 312Updating Stock Purchases . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .312

Chapter 21 Plan Maintenance: Savings Bond Update 313

Procedures in this Chapter .... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 314Adding Savings Bond Beneficiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .314


Defining Savings Bond Purchase Sequence. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .315Updating Savings Bond Purchases . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .316

Chapter 22 Plan Maintenance: Benefit Plan Limits 319

Procedures in this Chapter .... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 320Adjusting Defined Contribution or Defined Benefit Plan Balances. . . . . . . . . . .320Adjusting Covered Compensation Balances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .321Adjusting Vesting Hours .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .322

Chapter 23 Benefit Processes: Reportable Excess Group LifeInsurance 323

Procedure in this Chapter .... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 325Creating Reportable Income Time Records .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .325

Chapter 24 Benefit Processes: Benefit Plan Testing 329

Procedures in this Chapter .... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 330Listing Key Employees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .330Determining if Defined Contribution Plans are Top Heavy.. . . . . . . . . . . . . . . . . . .332Listing Highly Compensated Employees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .332Performing the ADP and ACP Tests .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .334Determining if Employees are Reaching an Elective Deferral Limit . . . . . . . . .335Determining Percentage DC/DB Plan Participation . . . . . . . . . . . . . . . . . . . . . . . . . . .335

Chapter 25 Benefit Processes: Retiree or COBRA Invoicing andTracking 337

Procedures in this Chapter .... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 338Creating Manual Invoices .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .338Creating Monthly Invoices.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .340Printing Invoices. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .341Entering and Automatically Applying Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .342Entering and Manually Applying Payments .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .343Updating Invoices and Payments to General Ledger . . . . . . . . . . . . . . . . . . . . . . . . .345

Chapter 26 Benefit Processes: Special Processing 347

Procedures in this Chapter .... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 348Simulating Benefit Elections . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .348Estimating Take Home Pay .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .350Forecasting Defined Contribution Account Balances . . . . . . . . . . . . . . . . . . . . . . . . .352


Purging Benefit Enrollments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .353Purging Invoices and Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .355

Appendix A Report Samples 357Employee Change Benefit Update (BN100) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .357Mass Benefit Add (BN101). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .359Plan Employee Update (BN102) .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .361Plan Update (BN105) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .363Life Insurance Reportable Income (BN150).. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .365Plan Parameter Listing (BN215). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .367Benefit Entry Rules Listing (BN216) .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .370Benefit Plan Status Report (BN220) .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .372Plan Participant Report (BN230) .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .374Employee Benefit Report (BN231) .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .376Benefits Statement (BN232) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .378Participation Report (BN236) .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .380One Page Benefit Statement (BN242) .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .382Benefit Election Form (BN245) .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .384Flex Missing Benefits Report (BN246) .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .386Monthly Premium Report (BN320) .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .388DC Plan Contributions (BN330) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .392

Appendix B Benefit System Logic Calculations 395

Calculating Annual and Hourly Pay Rates ... . . . . . . . . . . . . . . . . 396Calculating Annual Salary for an Hourly Employee . . . . . . . . . . . . . . . . . . . . . . . . . . .396Calculating Hourly Rate for a Salaried Employee . . . . . . . . . . . . . . . . . . . . . . . . . . . . .396

Company Match Calculations.... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 398Company Match Deduction Creation for Match Limit Schedules .. . . . . . . . . . .398Payroll Calculation for Match Limit Deductions .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .399Company Match Deduction Creation for Match Percent Schedules. . . . . . . . .400

Calculating the Cost of Excess Life Insurance .... . . . . . . . . . 404Determining Which Plans Are Reportable .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .404Determining Who Is Covered .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .404Determining the Value of Excess Coverage.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .405An Example of Calculating the Cost of Excess Life Insurance . . . . . . . . . . . . . . .408

Calculating COBRA Excess Premium Amounts ... . . . . . . . . . 410

Appendix C Benefit System Logic Information 411

Tracking Flex Credits .... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 412Standard Time Records .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .412Deductions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .413


Kinds of Flex Plans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .413

Defined Contribution Flex Benefits .... . . . . . . . . . . . . . . . . . . . . . . . . 420

Using Flex Benefit Periods ..... . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 421

Processing Automatic Benefit Changes..... . . . . . . . . . . . . . . . . . 423Creating Benefit Change Audit Records.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .423

Index 425


List of FiguresChapter 3 Benefits Administration Setup OverviewFigure 1. Procedure relationship:Benefits Administration setup overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29

Chapter 4 Setup: BN CompanyFigure 2. Form clip: Using BN00.1 to define benefit company .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38Figure 3. Form clip: Using BN00.2 to define COBRA parameters .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39Figure 4. Form clip: Using BN00.4 to define excess life insurance rates .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43

Chapter 5 Setup: BN PreliminariesFigure 5. Form clip: Using BN12.1 to define annual limits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50Figure 6. Form clip: Using BN03.1 to define vesting schedule .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51Figure 7. Form clip: Using BN30.1 to define benefit process order. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53

Chapter 6 Setup: Flex PlanFigure 8. Procedure relationship: Setup: Flex Plans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61Figure 9. Form clip: Using BN06.1 to define spending accounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62Figure 10. Form clip: Using BN08.1 to define flex credits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64Figure 11. Form clip: Using BN08.2 to define flex salary parameters .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67Figure 12. Form clip: Using BN08.3 to define flex credits based on age. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72

Chapter 7 Setup: Benefits PlanFigure 13. Procedure relationship: Setup: Benefit Plans .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 94Figure 14. Form clip: Using BN15.1 Main tab to define primary benefit plan .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 97Figure 15. Form clip: Using BN15.1 Eligibility tab to define primary benefit plan . . . . . . . . . . . . . . . . . . . . . . . . . . . . 98Figure 16. Form clip: Using BN15.1 Flex tab to define primary benefit plan. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 99Figure 17. Form clip: Using BN15.1 Deduction tab to define primary benefit plan.. . . . . . . . . . . . . . . . . . . . . . . . .100Figure 18. Form clip: Using BN15.1 Vest Tab to define vesting and covered compensation .. . . . . . . . . . . . .104Figure 19. Form clip: Using BN15.1 Invest tab to define investment options .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .108

Chapter 8 Setup: Benefit Entry RulesFigure 20. Form clip: Using BN16.1 to define entry rules.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .118

Chapter 9 Setup: BN Plan CoverageFigure 21. Procedure flow: Define coverage options. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .126Figure 22. Form clip: Using BN17.1 to define coverage options .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .127Figure 23. Procedure flow: Define coverage amounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .131Figure 24. Form clip: Using BN17.3 to define coverage amounts .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .132Figure 25. Procedure flow: Define coverage salary parameters .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .136Figure 26. Procedure flow: Define coverage reduction table .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .138Figure 27. Procedure flow: Define coverage limits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .142Figure 28. Form clip: Using BN17.4 to define coverage limits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .143

Chapter 10 Setup: BN Plan ContributionsFigure 29. Form clip: Using BN02.1 define age rate table . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .159Figure 30. Form clip: Using BN18.1 to define options amount . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .166Figure 31. Form clip: Using BN18.2 to define options amount range .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .171Figure 32. Form clip: Using BN18.3 to define flat contributions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .174Figure 33. Form clip: Using BN18.4 to define salary or coverage rate table. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .178Figure 34. Form clip: Using BN18.5 to define contribution limits. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .181

Benefits Administration User Guide List of Figures 13

Figure 35. Form clip: Using BN18.6 to define match limits schedules . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .187Figure 36. Form clip: Using BN18.7 to define match percent schedules. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .191

Chapter 11 Setup: Automation RulesFigure 37. Procedure flow: Define Add Rules. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .203Figure 38. Form clip: Using BN16.2 to define add rules . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .204Figure 39. Procedure flow: Define Change Rules .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .206Figure 40. Form clip: Using BN16.3 to define change rules . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .207Figure 41. Procedure flow: Define Termination Rules.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .208Figure 42. Form Clip: Using BN16.4 to define termination rules .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .209

Chapter 12 BN Enrollment: Enrolling Employees in Flex PlansFigure 43. Form clip: Using BN45.1 to manually create employee flex credit records.. . . . . . . . . . . . . . . . . . . . .217

Chapter 13 BN Enrollment: Enrolling Employees in Benefit PlansFigure 44. Form clip: Using BN245 to generate benefit enrollment forms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .226Figure 45. Form clip: Using BN101 to enroll employee into default plans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .227Figure 46. Procedure flow: Enrolling an Employee into Multiple Plans. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .231Figure 47. Form clip: Using BN31.2 to enroll an employee into multiple plans.. . . . . . . . . . . . . . . . . . . . . . . . . . . . .232Figure 48. Procedure flow: Enrolling manually multiple employees .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .236Figure 49. Form clip: Using HR13.2 to enroll dependents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .240

Chapter 14 BN Enrollment: Maintain Employee EnrollmentsFigure 50. Form clip: Using BN35.1 to hold or delete benefit change records .. . . . . . . . . . . . . . . . . . . . . . . . . . . . .252Figure 51. Form clip: Using BN100 to update benefit automation rules.. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .254Figure 52. Form clip: Using BN102 to update employee plan. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .257Figure 53. Form clip: Using BN32.1 to stop an employee�s benefits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .260

Chapter 15 BN Enrollment: COBRAFigure 54. Form clip: Using BN70.1 to define a COBRA participant. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .271Figure 55. Form clip: Using BN71.1 to enroll COBRA participants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .273

Chapter 16 BN Enrollment: RetireeFigure 56. Form clip: Using BN72.1 to enroll retirees .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .284

Chapter 17 Plan Maintenance: Benefit PlansFigure 57. Form clip: Using BN105 to update plan changes for enrollment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .296Figure 58. Form clip: Using BN104 to update enrollment for frequency table changes .. . . . . . . . . . . . . . . . . . .298Figure 59. Form clip: Using BN103 to terminate or replace a BN plan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .300

Chapter 21 Plan Maintenance: Savings Bond UpdateFigure 60. Procedure relationship:Savings Bond Update .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .314

Chapter 23 Benefit Processes: Reportable Excess Group LifeInsuranceFigure 61. Form clip: Using BN150 to create reportable income time records .. . . . . . . . . . . . . . . . . . . . . . . . . . . . .326

Chapter 25 Benefit Processes: Retiree or COBRA Invoicing andTrackingFigure 62. Form clip: Using BN180 to create monthly invoices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .340Figure 63. Form clip: Using BN81.1 to automatically apply payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .342Figure 64. Form clip: Using BN81.2 to manually apply payments .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .344

14 List of Figures Benefits Administration User Guide

Chapter 26 Benefit Processes: Special ProcessingFigure 65. Form clip: Using BN65.1 to simulate benefit elections .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .349

Benefits Administration User Guide List of Figures 15

16 List of Figures Benefits Administration User Guide

Chapter 1

Using This GuideThe purpose of this user guide is to provide reference material for your dailyuse of the product and for your needs in Lawson training.

This user guide contains procedures on basic and advanced features of theproduct. In addition, it provides information to help you understand how touse each procedure for your business processes.

User Guide ConventionsThis user guide uses specific text conventions, visual elements, andterminology.

Text ConventionsLawson user guides use the following standard text conventions.

This Representsbold A key name or a function key name.

For example, Shift is a key nameand Help (F1) is a function keyname.

A value or command that you musttype exactly as it appears.

A program name or a file name.

italics A manual title or form name.

An emphasized word or phrase.

A placeholder for a user-definedvalue or variable. Follow thecapitalization pattern of theplaceholder. For example, �Type$LAWDIR/print/username/jobname/stepnumber/FORprt� instructs you to type theuser name, job name, stepnumber, and form ID as follows:$LAWDIR/print/jane/em-plist/1/GL100.prt

(F1)�(F24) A function key number. �Press Help(F1)� instructs you to press the keymapped for the (F1) function.

Benefits Administration User Guide Chapter 1 Using This Guide 17

This RepresentsKey1+Key2 A key combination. �Press

Shift+FndNxt (F3)� instructs youto press and hold down the Shiftkey and then press the FndNxt (F3)function key. Release both keys tocomplete the action.

[ ] Optional parameters. You cantype none, one, or more of theparameters within the brackets. Forexample, the command

qsubmit [-Un] [-jJobQueue -dDate-tTime] username jobname

means that you can type a specificjob queue, date, or time, or you canomit these parameters.

[ | ] Optional parameters. You cantype only one of the parametersseparated by a vertical line. Forexample, the command

phraserpt[-n|t] BaseLanguage[Translation]

means that you can type either then or t parameter; you cannot typeboth.

... A parameter that can be repeated.For example, the command

scrgen [-scxvV] productline[systemcode [programcode...]]

means that you can type any numberof program codes.

Visual ElementsLawson user guides use the following visual elements.

STOP Information that must know before you attempt the procedure orprocess.

Need More Details? Check out the following concepts:

� Introduces a list of topics that provide additional or backgroundinformation. Each item in the list includes a cross-reference tothe information.

18 Chapter 1 Using This Guide Benefits Administration User Guide

Application integration. Events, required actions, or other consequences thatare related to other Lawson applications.

IMPORTANT Important information that you must consider when you performthe procedure.

CAUTION Cautionaryinformation about actionsthat involve a risk ofpossible damage toequipment, data, orsoftware.

WARNING Warninginformation about actionsthat involve a risk ofpersonal injury orirreversible destructionto the data or operatingsystem.

TIP Supplementalinformation aboutpossible shortcuts tothe procedure or yourbusiness process.NOTE Supplementalinformation that mightbe of interest to youas you complete theprocedure.

TerminologyThe following terms have precise meanings in Lawson documentation.

Term Meaningaccess Open a Lawson application form or

subform.

choose Start a process.

�Choose Add� instructs you to clicka button or a link on a form to add arecord to the Lawson system.


Term Meaningclick Place the cursor over an object

(such as a button, link, or tab) andpress the left mouse button.

NOTE This description applies to astandard PC mouse with standardsettings. You must translatethe meaning of �click� to what isappropriate for your equipment.

define Use a Lawson form to create a newrecord for a company, a vendor, aclass, a code, or another entity usedthroughout the Lawson system.

\_� or �

Specify configuration parameters,printers, security roles, data areas,and so on.

run Send data for processing. Forexample, run a report or batch job.

select Identify an item to process. Selectingan item does not start a process.

To select an item, place the cursorover an item and then click.

If you use character-based mode,highlight an item to select it.Sometimes, you must also pressMark or Next or choose OK.

type Press keyboard keys to enterinformation in a field and move thecursor to the next field.

At a command line, type the lettersexactly as written in the procedure,and then choose OK.

OK Choose OK to save or process thedata that you entered on the currentform.

� �Choose OK� instructs you toclick a button or a link on a form.An �OK� button might be labeled�Update� or show a check mark.An �OK� link might be labeled�OK.�

� �Choose OK� instructs you topress the keyboard key mappedas Enter.


Product DocumentationLawson offers the following product documentation:

� Online help

� User guides and manuals

� Release notes and installation instructions

� Enhancement and patch documentation

To find Lawson documentation, see the user interface orhttp://support.lawson.com. To obtain a login password and ID for the Supportsite, see your organization�s Lawson contact or your Lawson client manager.

Global Support CenterLawson Global Support Center (GSC) services are available to all Lawsoncustomers who are on maintenance support for Lawson products. See theGlobal Support Manual for the following information:

� What information to gather before you contact the GSC

� How to contact the GSC

� How the GSC processes your request

� How to receive enhancements and patches

� Which services are standard maintenance and which services are billable

To find the Global Support Manual, see http://support.lawson.com. To obtaina login password and ID for the support web site, see your organization�sLawson contact or your Lawson client manager.

Documentation ContactWe welcome your questions or suggestions about Lawson documentation.Please send comments to [email protected].


Chapter 2

Benefits Administration OverviewThe Lawson Benefits Administration application offers flexible tracking ofemployee, retiree, and COBRA participant benefits.

This chapter provides a high-level overview of Benefits Administration,including information on the application�s major processes, and integrationwith other Lawson and non-Lawson products.

Benefits Administration Process FlowThe Benefits Administration application can be considered as four mainprocesses: setup, benefit plan enrollment, plan maintenance, and benefitprocesses. Take a closer look at what the four processes involve.

Benefits Administration SetupThe Benefits Administration Setup section looks at the decisions neededto structure your organization�s use of Lawson Benefits Administration.Define the company parameters and settings that are specific to the BenefitsAdministration application. Structure your benefit plans and set your planentry rule requirements. Define coverage and plan contribution types, anddecide on automation rules to automate processing.

Benefits Plan EnrollmentThe Benefits Plan Enrollment section includes the processes and proceduresneeded to enroll your employees in your benefit plans. Included are flexbenefit, COBRA participant, and retiree enrollments. Also discussed in thissection is the process of maintaining your employees� enrollments.

Benefits Plan MaintenanceThe Benefits Plan Maintenance section considers a variety of maintenanceprocesses and procedures to update and maintain your organization�sbenefit plans. Included are maintenance on flex vacation-type plans,spending account withdrawals for employees and COBRA participants, stockpurchases, savings bond purchases, and maintaining benefit plan balances.

Benefits Administration ProcessesThe Benefits Administration Processes section considers assorted processesthat fill out your benefit maintenance needs. Included are incorporatingtaxable income from excess life insurance, auditing benefit data, COBRAparticipant and retiree invoicing, simulations, and purging.

Benefits Administration User Guide Chapter 2 Benefits AdministrationOverview

23

Benefits: The Big PictureYou use the Benefits Administration application to administer and trackyour employee, COBRA participant, and retiree benefits. The BenefitsAdministration User Guide is divided into four major activity sections.

ReportableExcess LifeInsurance

VacationBuy/SellUpdate

BNProcesses

MaintainingBN Plans

PlanMaintenance

Flex Plans

Employees

BN PlanEnrollment

BN Company

Preliminaries

Setup

Flex Plan

BN-Plans

BNAutomation

Rules

MaintainEmployee

Enrollments

COBRA StockPurchaseUpdate

SavingsBond

Update

Benefit PlanTesting

Invoice andPaymentTracking

SpecialProcessing

MaintainingBN Limits

BN-PlanCoverage

BN-PlanContributions

SpendingAccountBalance

Retirees

You Are Here

BN EntryRules

24 Chapter 2 Benefits Administration Overview Benefits Administration User Guide

Benefits Administration Integration with other ApplicationsThis section explains how the Lawson Benefits Administration applicationintegrates with other Lawson applications.

PersonnelAdministration

Payroll

HumanResources

TimeManagement

GeneralLedger

BenefitsAdministration

PayrollThe Benefits Administration application creates deductions for payroll use.The Payroll application submits salary compensation and hours for trackingagainst limits. Closing the payroll cycle updates employee balances forcovered compensation and contribution amounts for defined contributionand defined benefits plans.

Personnel AdministrationThe Personnel Administration application creates personnel actions forBenefits Administration automation rules and COBRA record creation.

Time ManagementThe Benefits Administration application updates the balances in the timeaccrual plan for vacation buy and sell plans.

Benefits Administration User Guide Chapter 2 Benefits AdministrationOverview

25

General LedgerThe Benefits Administration application updates the General Ledgerapplication with COBRA and Retiree invoicing.

Employee and Manager Self-ServiceThe Employee and Manager Self-Service application gives employees andmanagers access to vital information over your organization�s intranet.Employee and Manager Self-Service lets the HR and Payroll departmentsavoid excessive manual data entry by letting employees and managersupdate their own information. Your organization determines what informationis available for employees and managers to view or update. Employees andmanagers access the information whenever and wherever it is needed.

Employee and Manager Self-Service lets your organization establish specificbenefit enrollment processes through which employees view and update theirbenefit elections. Employees have instant and direct access to their ownbenefit enrollment information, including current elections, other plans forwhich they are eligible, plan descriptions, and detailed coverage and premiuminformation. Employees are led through the process based on rules youdefine, and an employee eligibility. Employees select their choices and uponcompletion and receive a summary of their benefit decisions. The employeeelections update your Lawson database so that no data entry is necessary byyour benefits administration staff.

26 Chapter 2 Benefits Administration Overview Benefits Administration User Guide

Chapter 3

Benefits Administration Setup OverviewBefore you can start enrolling and maintaining your benefit plans, you mustperform several setup tasks. By completing these setup tasks, you providebasic information that is vital for benefit processing. For example, the types ofbenefit plans you want to offer, type of coverage, how employees and yourcompany will make contributions and deductions, whether you want to trackbeneficiaries and who are your insurance carriers.

Benefits Administration User Guide Chapter 3 Benefits AdministrationSetup Overview

27



BNProcesses

MaintainingBN Plans

PlanMaintenance

Flex Plans

Employees

BN PlanEnrollment

BN Company

Preliminaries

Setup

Flex Plan

BN-Plans

BNAutomation

Rules

MaintainEmployee

Enrollments


SavingsBond

Update

Benefit PlanTesting


SpecialProcessing


BN-PlanCoverage



Retirees

You Are Here

BN EntryRules

28 Chapter 3 Benefits Administration SetupOverview


Benefits Administration Setup OverviewYou must complete required setup within the Benefits Administrationapplication and in other specified Lawson applications. The following diagramshows the order in which you should perform the setup steps.

Figure 1. Procedure relationship:Benefits Administration setup overview

BN Company

Preliminaries

-Optional-Flex Plan

BN-Plans

-Optional-BN

AutomationRules

BN-PlanCoverage


BN EntryRules

Benefits Administration Setup Step-by-StepYou can find details about concepts and procedures related to setup in thefollowing chapter and in the additional noted resources.


29

Setup What is required? For more information,see

Benefit Company You need to definecompany parametersthat are specificto the LawsonBenefits Administrationapplication. Thischapter coversinformation youneed to define thoseparameters.

" Setup: BN Company"on page 33 in this userguide.

Benefit Preliminaries You define thosesetting that all yourbenefit plans can use.Those settings are:

� Annual limits

� Insurance carriers

� Vesting schedule

� Frequency tables

� Benefit processorder

� Postal code tables

" Setup: BNPreliminaries" on page45.

Flex Plan If your companyprovides flex benefitsor reserved spendingaccounts, you need todefine your Flex Plansbefore you define yourcompany�s overallbenefits

" Setup: Flex Plan" onpage 55.

Benefit Plan When defining benefitplan parameters, youare structuring theplan. Benefit plansuse several differentfeatures in the HumanResources application.You use employeegroups from the HumanResources application.You also use Deductioncodes, Pay classes,and Pay codes fromthe Payroll application.

" Setup: Benefits Plan"on page 79.




Benefit Entry Rules The Benefit applicationrequires plan entryrules for employeeenrollment in benefitplans.

Before you defineentry rules, you wantto define the payclass and employeegroups you plan to useto calculate benefiteligibility.

" Setup: Benefit EntryRules" on page 113.

BN Plan Coverage In each plan youcan define uniquecoverage for differentgroup of employees.You can also definedefault coverage optionfor a plan. If youdefined your coverageoption as No coverage,you do not need theinformation in thischapter.

" Setup: BN PlanCoverage" on page 121.

BN Plan Contributions There are sevendifferent contributiontypes. In each planyou can define uniquecoverage for differentgroup of employees.

Before you canset up benefit plancontributions, youmust have a benefitplan, coverage, anddeduction codesdefined. You cannotsuccessfully createplan contributionswithout the appropriatedeductions attached tothe plan

" Setup: BN PlanContributions" on page147.


31


Automation Rules Benefit automationrules let you automateBenefit processing.This chapter focuseson those proceduresthat define the add,change, and terminateautomation rules

" Setup: AutomationRules" on page 195.

Non-Lawson Payroll



Chapter 4

Setup: BN CompanyTo use the Benefits Administration application, you must define companyparameters that are specific to the Lawson Benefits Administration application.This chapter covers information you need to define those parameters.

If you are upgrading your application from release 7.2.x to release 8.0.x, seethe Upgrade Information Packet (UIP) for complete information about whattasks you need to complete before using this application. The UIP is availablefrom your Lawson Client Manager.

Benefits Administration User Guide Chapter 4 Setup: BN Company 33



BNProcesses

MaintainingBN Plans

PlanMaintenance

Flex Plans

Employees

BN PlanEnrollment

BN Company

Preliminaries

Setup

Flex Plan

BN-Plans

BNAutomation

Rules

MaintainEmployee

Enrollments


SavingsBond

Update

Benefit PlanTesting


SpecialProcessing


BN-PlanCoverage



Retirees

You Are Here

BN EntryRules

34 Chapter 4 Setup: BN Company Benefits Administration User Guide

Concepts in this ChapterTIP To skip directly tothe procedures, see"Procedures in thisChapter" on page 37

The following concepts provide background and conceptual information forthe procedures within this chapter.


� "What is a Benefit Company?" on page 35

� " What are COBRA Occurrence Types?" on page 35

� "What is Reportable Group Term Life Insurance?" on page 36

What is a Benefit Company?Lawson uses a benefit company to hold the parameters that are specific toyour plans. This benefit company is associated with the Human Resourcescompany you previously set up.

Benefit Company ParametersThese defaults are specific to your benefit plans. The parameters includethe following:

� General Ledger account you want to use for cash received from invoicepayments

� Invoice billing dates for retirees and COBRA participants

� Whether health, dental and dependent life plans will track dependent cov-erage

� COBRA occurrence types

� Rates to calculate taxable amount for reportable group life insurance

What are COBRA Occurrence Types?COBRA occurrence types are qualifying events that cause the loss of benefitcoverage for an employee or dependent. Examples of occurrence typesinclude divorce, separation, death, termination, reduction in working hours, orloss of dependent status based on plan definition.

When you set up your benefit company and begin to define COBRAparameters, you define occurrence types as a code that represents anoccurrence. For example, D represents divorce, or RE represents reductionin working hours. COBRA applies only to the United States.


What is Reportable Group Term Life Insurance?If the company pays all or a portion of the premium for a group life insuranceplan, then coverage amounts in excess of the Internal Revenue Service(IRS)-determined limit results in taxable or �imputed� income to the employee.Using rates set by the IRS, the value of the excess coverage is added to anemployee�s taxable wages and is subject to payroll withholding taxes.

For example: The IRS has determined that the first $50,000 of group term lifeinsurance coverage is exempt from this calculation. An employee is enrolledin a plan where the company pays half of the cost of the coverage. Theemployee�s total coverage is $75,000, so the excess coverage is $25,000.(75,000 - 50,000).

This amount must be multiplied by the rate associated with the employee�sage bracket to determine the value of this excess coverage, which thenbecomes reportable income for the employee. If the employee pays theirportion of the premium with after-tax dollars; however, the premium paid canoffset the calculated imputed income.


Procedures in this ChapterThe only required procedure to set up a benefit company is defining a BenefitsAdministration (BN) company. Defining COBRA parameters, occurrencetypes, and excess life insurance are optional.

Defining a BN Company You must define a BN companybefore you can use the BenefitsAdministration application.

Defining COBRA Parameters Optionally, you define the defaultsfor tracking COBRA participantsand invoicing COBRA and retireeparticipants.

Defining COBRA OccurrenceTypes

Optionally, you define theoccurrences and the number ofmonths coverage extends for eachoccurrence.

Defining Excess Life InsuranceRates

Optionally, you define theparameters for the applicationto calculate employee tax liability forthe cost of excess life insurance.

Defining BN CompanyBefore you can define benefit plans, you must define your company�s benefitparameters. This procedure outlines the process for defining a benefitcompany.


� "What is a Benefit Company?" on page 35

� "Benefit Company Parameters" on page 35


STEPS To define a benefits company1. Access Benefits Company (BN00.1).

Figure 2. Form clip: Using BN00.1 to define benefit company

2. Select Company in the Company field.3. Enter the general ledger account you want to use in the Cash Account

field. The application uses the cash account information when you receiveCOBRA and retiree benefit payments.

4. Enter Retiree information. Consider the following fields.

Billing Period Leave blank on your initial setup. This fieldis automatically updated when you processinvoices. If you leave this field blank, it is updatedby Invoice Edit (BN180), then by Invoice Print(BN181).

Due Days Type the number of days from an invoice datethat retiree premiums are due. The applicationcalculates due dates for invoices using this field.You can use BN180 to overwrite the due days.

Grace Period Type the number of days from an invoice�s duedate that COBRA participants and retirees mustpay their premium.

NOTE Outstanding Invoice Listing (BN175)uses this value to determine which invoices areoutstanding.

5. Select the dependent coverage you want to track in the Covered Depen-dents area. You can track Health, Dental and Dependent Life plans.

6. Choose the Add form function.


Related Reports and InquiriesTo UseView company benefits Company Parameter Listing (BN200)

Defining COBRA ParametersThis procedure allows you to define the defaults for tracking and invoicingCOBRA participants.

STEPS To define COBRA parameters1. Access COBRA Parameters (BN00.2).

Figure 3. Form clip: Using BN00.2 to define COBRA parameters

2. Select the Company in the Company field.3. If you want the application to assign participant numbers, define the partic-

ipant numbering information. Consider the following fields.

IMPORTANT If you use Employee Change Benefit Update (BN100) toautomatically create COBRA participant records, you must select Yes inthe Autonumbering field.

Auto numbering Select Yes if you want the application to assignnumbers to COBRA participants when they areadded.

BeginningNumber

If you selected YES in the Autonumbering field,enter the number you want to start numberingCOBRA participants with. After COBRAparticipant records have been created, the lastnumber used displays in this field.

4. Define the Notification days. Consider the following fields.


Employee Type the number of days a covered employeeor dependent has to notify the employer of aqualifying event. If the employer is not notified inthis number of days, the employee or dependentloses the right to extend coverage.

Company Type the number of days after a qualifying eventthat the company has to notify employees anddependent of their right to extend coverage.

Election Type the number of days employees anddependents have to notify the company of theirelection of coverage. If the employer is notnotified in this number of days, the employee ordependent loses the right to extend coverage.

IMPORTANT If the difference between the Occurrence Date and CompanyNotified fields on COBRA Participant (BN70.1) is greater than the number ofdays in the Employee field on COBRA Parameters (BN00.2), the COBRAparticipant�s Termination Date becomes the same date as the COBRAparticipant�s occurrence date; the participant forfeits the right to extendcoverage.

5. Define your COBRA billing information. Consider the following fields.

Premium percent Type the percent of the total premium to chargeCOBRA participants. This value must be at least100 percent. For example, if you want to increasean employee�s premium by 2% to cover COBRAadministration costs, you type 102.

Excess premiumaccount

If the premium percent is greater than 100because of to the surcharge for administrationcosts, select the GL account where you want thesurcharge to accumulate.

If you leave the account field blank, the surchargeaccumulates in the accrual account defined oneach plan.

Billing Period Leave this field blank for the initial set up. Thisfield is automatically populated and updated asyou complete the invoicing process each month.


Due Days Type the number of days from an invoice datethat COBRA premiums are due.

Initial GracePeriod

Type the number of days from the due date ofthe first invoice that COBRA participants have topay their first premium.

NOTE Outstanding Invoice Listing (BN175)uses this value to determine which invoices areoutstanding.


Related Reports and InquiriesTo UseList the COBRA participants whohave not been notified within thespecified days

COBRA Notification Report (BN170)

Determine which participants didnot pay their premiums in the graceperiod

Outstanding Invoice Listing (BN175)

Defining COBRA Occurrence TypesAn occurrence is an event that allows an employee or the employee�s qualifiedbeneficiaries to continue benefit coverage. Examples of an occurrenceinclude divorce, separation, death, termination, reduction in working hours, ora dependent whose age exceeds the plan definition of a dependent.

Define the occurrences and the number of months coverage extends for eachoccurrence. In addition, you can assign standard letters to occurrences.


� " What are COBRA Occurrence Types?" on page 35


STEPS To define COBRA occurrence types1. Access COBRA Occurrence Types (BN00.3).2. Select the Company.3. Type the maximum number of months you want coverage to extend for

multiple occurrences, in the Multiple Events Maximum field.4. Consider the following fields.

Type Type the code that represents the kind ofoccurrence.

Description Type the occurrence description. For example,reduction in working hours.

Months Type the number of months that COBRAparticipant coverage extends for this occurrence.For example, 18 months after a reduction inworking hours.

Letter Select a standard letter if you want to send astandard letter to people with this occurrence. Astandard letter can be defined using StandardLetter (BN05).


Related Reports and InquiriesTo UseDefine standard letters Standard Letter (BN05.1)

Defining Excess Life Insurance RatesYou define parameters to calculate an employee�s tax liability for excessemployee and dependent life insurance. The parameters include theexcludable coverage amount and a monthly costs table. The IRS determinesthe monthly cost table which is subject to change. You must maintain themonthly cost table every year.

The Benefits Administration application uses the values you define inconjunction with information in each life insurance plan to determine whichemployees and dependents have excess life insurance, and to calculatethe cost of excess life insurance.




STEPS To define excess life insurance rates1. Access Group Life W-2 Table (BN00.4).

Figure 4. Form clip: Using BN00.4 to define excess life insurance rates

2. Select the Company in the Company field.3. Type the current amount of excludable life insurance for employee and

dependent life. The cost of group life insurance in excess of this exclusionmust be reported as income to the employee.

4. Type the dollars of coverage on which the cost of insurance is based.5. Consider the following fields.

Age For each premium rate, enter the starting age.The application will calculate the ending age.

Cost Enter the monthly cost of excess life insurance.The cost is for the increment of coverage definedin the Monthly Cost Per field, which is dictatedby the IRS.


Chapter 5

Setup: BN PreliminariesThis chapter focuses on those procedures you need to perform before youdefine your benefit plans. All benefit plans can use the settings you define inthese procedures.



BNProcesses

MaintainingBN Plans

PlanMaintenance

Flex Plans

Employees

BN PlanEnrollment

BN Company

Preliminaries

Setup

Flex Plan

BN-Plans

BNAutomation

Rules

MaintainEmployee

Enrollments


SavingsBond

Update

Benefit PlanTesting


SpecialProcessing


BN-PlanCoverage



Retirees

You Are Here

BN EntryRules

Benefits Administration User Guide Chapter 5 Setup: BN Preliminaries 45




� "What are Annual Limits?" on page 46

� "What is a Vesting Schedule?" on page 46

� "What is a Frequency Table?" on page 47

� "What is a Benefit Process Order?" on page 48

What are Annual Limits?Annual limits are the maximum compensation and maximum annual additionsfor a calendar year. These limits are used by the Benefits Administration andPayroll applications. The Benefits Administration application uses theselimits for discrimination testing. The Payroll application uses these limits todetermine when contributions for defined contribution plans should stop.

What is a Vesting Schedule?A vesting schedule is a table that determines when your company�scontributions become non-forfeitable to an employee. You define the vestingschedule based on years of service.

When you attach a vesting schedule for a benefit plan, you define theminimum number of hours that must be worked in a plan year, to havethat year count toward vesting. You can also use a pay class to determinewhich hours are counted.

For information on pay classes, see the Payroll User Guide.

You use vesting schedules for defined benefit and defined contribution plans.You can assign the same vesting schedule to multiple plans, or if vesting isdifferent for each plan, you can assign a different schedule to each plan. Forexample, the table below illustrates a vesting schedule.

Number of years Percent Vested

Less than 2 years 0%

2 years 40%

3 years 60%

4 years 80%

5 or more years 100%

46 Chapter 5 Setup: BN Preliminaries Benefits Administration User Guide

What is a Frequency Table?This is a table the Benefits Administration application uses to establishemployee benefit deductions. The Benefits Administration application alsouses frequency tables in Flex Plans, to determine the amount for standardtime records.

You define annual contributions for benefit plans, and the table determinesthe amount of each deduction and when the deduction should be included inthe payroll cycle for all employees, regardless of their pay frequency. Thisway you do not have to define separate contribution amounts for each of thepossible pay frequencies.

Frequency Table ComponentsFrequency tables are made up of contribution divisors and deduction cyclesby employee pay frequency. A frequency table is required for all plans thatcreate a deduction or standard time record for an employee. The frequencytable must be the same for all benefit plans under a flex plan.

ExampleA frequency table consists of one Divisor and nine Deduction Cycle fields foreach pay frequency. The following is an example of a frequency table.

Table 1 Every Cycle Occurrences

Deduction CyclesPay Frequency Divisor 1 2 3 4 5 6 7 8 9Weekly 52 X X X X X

Bi-Weekly 26 X X X

Semi-Monthly 24 X X

Monthly 12 X

Table 2 Once a Month Occurrences

Deduction CyclesPay Frequency Divisor 1 2 3 4 5 6 7 8 9Weekly 12 X

Bi-Weekly 12 X

Semi-Monthly 12 X

Monthly 12 X

How the Divisor and Deduction Cycle Fields areUsedThe Benefits Administration application uses the Divisor field to determinethe amount for deductions and standard time records. For example, anemployee has a benefit with a $300 annual contribution. The employee�s


pay frequency is weekly. Using example 1, the Benefits Administrationapplication determines the deduction amount by dividing the contribution bythe Divisor of the employee�s pay frequency. The employee�s deductionfor the benefit is $5.77 ($300/52).

Using example 2, the deduction will only be taken once a month, the amountof the deduction would be $25 (300/12). The annual contribution is dividedby 12 regardless of pay frequency, since the deduction will only be takenonce a month, or 12 times each year.

The Deduction Cycles fields determine when the Payroll application deductsthe employee contribution from the employee�s payment, or when the Payrollapplication adds the standard time record. For a monthly frequency in thetable shown above, the Payroll application takes deductions only duringthe first payroll cycle.

For information on deductions and deduction cycles, see the Payroll UserGuide.

How Do You Use the Table?When you define a benefit plan, you assign a frequency table to the plan.You can assign the same frequency table to every plan. If either the divisoror the deduction cycles are different by plan, you can assign a differentfrequency table to each plan.

IMPORTANT You need to update the employee deductions and standardtime records before the next payroll cycle if you: - Assign a different frequencytable to a benefit plan - Change a frequency table assigned to a benefit ora flex plan For more information, see " Plan Maintenance: Benefit Plans"on page 287.

What is a Benefit Process Order?A Benefit Process Order is the order in which your plan types display on thebenefit entry form or flex enrollment form. It is also the order enrollments areprocessed if you add multiple benefits at one time. You can define sequencesfor a company, a process level, or an employee.

The following is the process order: employee, process level, company. Forexample, if a company-wide sequence is defined for Two Rivers company,and employee Ann Smith has an order different from Two River�s order, theapplication uses the employee�s order.


Procedures in this ChapterThe following procedures set up those elements used by all benefit plans.

Defining Annual Limits Tasks to determine the maximumcompensation and annual limits forthe calendar year.

Defining Insurance Carriers Tasks to define your company�sinsurance carriers.

Defining Vesting Schedule Tasks to define the table thatdetermines when your company�scontributions become non-forfeitableto an employee.

Defining Frequency Tables Tasks to define the table used tocalculate the pay period contributionsof each employee.

Defining BN Process Order Tasks to indicate the order you wantyour plan types to appear on thebenefit entry form.

Defining Postal Code Tables Tasks to define postal code tableyou can use as additional benefiteligibility criteria.

Defining Annual LimitsThe Benefits Administration application uses the maximum compensation andmaximum annual additions for discrimination testing and to determine whencontributions for defined contribution plans should stop.

IMPORTANT You must perform this procedure annually, even if the limitsdo not change.

STOP You need to define a deduction class for the maximum additionslimit. For more information, see the Human Resources User Guide.


� "What are Annual Limits?" on page 46


STEPS To define annual limits1. Access Benefits Annual Limits (BN12.1).

Figure 5. Form clip: Using BN12.1 to define annual limits

NOTE The plan yearmay or may not coincidewith the calendar year.

2. Type the plan year, maximum compensation, and maximum annual addi-tions amounts.

3. Choose the Add form function. If you are adding a new year to an existinglist, choose the Change form function.

Defining Insurance CarriersTo track and associate insurance carriers with a plan, you must define yourcompany�s insurance carriers.

STEPS To define insurance carriers1. Access Insurance Carrier (BN01.1).2. Consider the following fields.

Insurer Type the code you want to represent the insurer.

Insurer ID Type the insurer�s identification number.

3. Fill out the remaining fields.4. Choose the Add form function.

Related Reports and InquiriesTo UseView a specific insurance carrier Insurance Carrier Listing (BN201)


Defining Vesting ScheduleThe vesting schedule determines when a company�s contributions becomenon-forfeitable to an employee based on years of service.


� "What is a Vesting Schedule?" on page 46

STEPS To define vesting schedule1. Access Vesting Schedule (BN03.1).

Figure 6. Form clip: Using BN03.1 to define vesting schedule

2. Type the code and a description that represent the vesting schedule in theSchedule field.

3. Consider the following fields.

Years of Service Type the number of years of service required foreach level of vesting. At least one year must bedefined.

Vesting can be based on plan year, calendar yearor employment year as defined in the Vest Compform tab of Benefit Plan (BN15.1). See "DefiningVesting and Covered Compensation Information" on page 104, for more information.

Vested Percent Type the employee�s vested percentage for thisyear of service.



Related Reports and InquiriesTo UseView vesting schedules Vesting Schedule Listing (BN203)

Defining Frequency TablesThe Benefits Administration application uses frequency tables so you do nothave to define a contribution amount for every pay frequency. Instead, youdefine one contribution record with the annual amount of the premium. Theapplication then uses the table to determine the individual deduction amountfor each employee.



STEPS To define frequency tables1. Access Frequency Table (BN04.1).2. Select Company in the Company field.3. Type the code and the description that represents the frequency table in

the Table field.NOTE The number ofpay periods in a yearwill default into this fieldfor each pay frequency.If you need a differentvalue, type that value inthe field.

4. Type the contribution divisor for your employees.5. Select the deduction cycle.

IMPORTANT To add the frequency table, at least one cycle must be markedfor each pay frequency, even if your company does not use that frequency.


Related Reports and InquiriesTo UseView frequency tables Frequency Table Listing (BN204)

Update benefits for frequency tablechanges

Frequency Table Update (BN104)

Defining BN Process OrderThis procedure allows you to define the order in which you want benefit plansto appear on the benefit form. You can define the process order for thecompany level, the process level or the employee level.



� "What is a Benefit Process Order?" on page 48

STEPS To define BN process order1. Access Benefit Process Order (BN30.1).

Figure 7. Form clip: Using BN30.1 to define benefit process order

2. Select the Company from the Company field.3. Type a number beside each plan type to indicate the sequence.4. Choose the Add form function.

Option for defining a BN process orderIf you want to define the order for a specific process level, then select theprocess level in the Process Level field and type a number beside eachplan type to indicate the sequence.

If you want to define the order for a specific employee, then select anemployee in the Employee field and type a number beside each plan typeto indicate the sequence.

Defining Postal Code TablesYou use postal code tables to further define benefit eligibility criteria. Whenyou assign a postal code table to a plan, you limit the plan�s eligibility toemployees with benefit postal codes assigned to the table.

Benefit postal codes for an employee are defined on the Ben Dates formtab of HR11.1.


STEPS To define postal code tables1. Access Eligibility Postal Codes (BN11).

NOTE To load thePostal code tablesinto the BenefitsAdministrationapplication you usethe Universe utilities�importdb�.

2. Select the Postal Code table you want to use in the Postal Code Table field.3. Type the postal code you want to define.4. Choose the Add form function.

Related Reports and InquiriesTo UseView an employee�s benefit postalcode

Employee (HR11) Ben Dates tab


Chapter 6

Setup: Flex PlanThis chapter focuses on procedures you use to set up flex plans. If yourcompany provides flex benefits, you must define your flex plans before youdefine your company�s overall benefits.



BNProcesses

MaintainingBN Plans

PlanMaintenance

Flex Plans

Employees

BN PlanEnrollment

BN Company

Preliminaries

Setup

Flex Plan

BN-Plans

BNAutomation

Rules

MaintainEmployee

Enrollments


SavingsBond

Update

Benefit PlanTesting


SpecialProcessing


BN-PlanCoverage



Retirees

You Are Here

BN EntryRules

Benefits Administration User Guide Chapter 6 Setup: Flex Plan 55


The following concepts provide background and conceptual information forthe procedures within this chapter


� "What is a Lawson Flex Plan?" on page 56

� "What are Flex Credits and Flex Credit Records?" on page 57

� "How are Flex Credits Issued and Structured?" on page 58

� "What Happens to Unspent Flex Credits?" on page 59

� "When do I Define Flex Credit Records?" on page 58

What is a Lawson Flex Plan?In Lawson, a flex plan can either be a spending account only, or a full flex plan.The major characteristic of a flex plan is the 12-month enrollment period. Youdefine the plan�s start date (month and day) which determines the flex planyear. All enrollments in the flex plan will be stopped automatically at the endof each plan year. Coverage or contribution levels must then be re-elected forthe new plan year, even if the same coverage or contribution level is desired.

When you define flex plans, you determine if your flex plan is a spendingaccount only or a full flex plan. You need to consider the following when youdefine a flex plan:

� Spending account only or full flex plan

� Who is eligible for plan participation

� How you want to issue flex credits

� How you want to manage unspent flex credits

Spending Account OnlyA spending account only flex plan is defined when the only benefit which willbe attached to the flex plan is reserve spending accounts. (i.e. the typeof plans that allows pre-tax contributions to be used for reimbursementof qualified medical or dependent care expenses.) This type of flex planinvolves minimal set-up, and enables the application to enforce the 12 monthenrollment period that is normally a feature of spending account plans.

Full Flex PlansThere are two major characteristics to a full flex plan: flex credits and the12 month enrollment period. For all employees associated with a full flexplan the following is true:

� At least one flex credit record must be defined for each flex plan year

56 Chapter 6 Setup: Flex Plan Benefits Administration User Guide

� An employe must have a flex credit record for the flex plan year to enroll inany benefits

� An employee may receive or spend flex credits by enrolling in benefits

� The stop date for all benefits will default to the last day of the flex plan year

For the application to determine when to allocate flex credits, a frequencytable must be associated to flex plans. All benefit plans within the Flex Planmust use the same frequency table as the flex plan. The frequency tabledetermines both the amount of standard time records and the pay cycleswhen flex credits are added.

What are Flex Credits and Flex Credit Records?Flex credits are the amounts you give to your employees to purchase benefits.Employees then use these credits to purchase benefits.

When you define flex credits, the application creates a flex credit record thatdetermines how flex credits are calculated. In addition flex credit recordsdetermine the percentage (if any) of unspent flex credits that is paid toemployees as taxable wages, and the amount (if any) of regular pre-taxincome that can be used to purchase benefits after all flex credits have beenused. Flex credits may be calculated based on many variables, includingsalary, years of service, age, or number of dependents.

A flex record is defined for the benefit plan, so you can generate a record foreach employee. Any employee enrolled in the plan will have an individual flexcredit record.

ExamplesScenario Example

Flex credits (given before enrollment)that can be used to purchase otherbenefits with 80 percent of anyunused dollars taken as taxableincome.

John receives $1,500 flex creditsbefore he chooses his benefits. Hespends $1,200 to purchase benefits.Of the $300 remaining, he receives80% or $240, as taxable wages.


Scenario Example

Flex credits (given by election ofbenefit) that can be used to purchaseother benefits with 100 percent ofany unused dollars taken as taxableincome.

Tom is covered under his wife�shealth plan. Based on his election towaive coverage, he gets $500 flexcredits to spend. He spends $400of the flex credits to purchase familydental coverage and receives $100as taxable wages.

Flex credits (given by election) thatcannot be used to purchase otherbenefits with 100 percent goingdirectly to taxable income.

Based on Sue�s election to takesingle health coverage, she receives$100 flex credits. Sue also elects totake a supplemental life benefit thatcosts $200. Since she cannot applyher $100 in flex credits to the costof the supplemental life, the $100is added to her taxable wages andthe $200 cost of supplemental life isdeducted from her wages.

When do I Define Flex Credit Records?Before the beginning of each flex plan year, you define how flex credits aredetermined. You must define a flex credit record with a new effective dateevery plan year, since each flex credit record is only valid for 12 months.

How are Flex Credits Issued and Structured?There are three options you can use to issue flex credits to your employees:

� Issue credits before employees choose their benefits

� Associate credits to specific benefit plans, then issue credits based on theemployee�s benefit choice

� Issue credits based on a combination of the first two options

If you issue credits before your employees choose their benefits, you canstructure the flex credits in any of the following combinations:

� A base amount to every eligible employee. For example, all employees ina flex plan receive $1,000.

� A percentage of each employee�s salary. You can define a minimum andmaximum salary amount for calculating flex credits. For example, eachemployee in the flex plan receives flex credits equal to 10% of his or hersalary. An employee earning a $30,000 salary receives flex credits worth$3,000.

� An amount for each employee�s age, years of service, number of depen-dents, or lifestyle points.


If you base credits on age, years of service, dependents, or lifestyle, you needto define rate tables to vary the credits. For age and years of service you cangive credit based on an employee�s annual salary or as a flat amount.

What Happens to Unspent Flex Credits?You can allow employees to add unspent credits to their gross pay as taxableincome. For example, you let your employees keep 80% of their unspentcredits. Jane Doe has $1,000 of unspent flex credits. She will now have $800added to her taxable wages for this flex year.

If you do not indicate an amount for unspent taxable credits, when you defineyour flex credits, employees will lose all their credits.


Procedures in this ChapterIn Lawson, a flex plan can either be a spending account only, or a full flexplan. The procedures below detail how to set up Flex plans for your company.

Defining Spending Account OnlyFlex Plan

Tasks to define a spending accountonly flex plan. You define the planyear and select the plan�s frequencytable for the spending account.

Defining Full Flex Plan Tasks to define a full flex plan. Youmust define a flex credit if you definea full flex plan.

Defining Flex Credits Tasks to define the flex credits youwant to give employees beforethey enroll in benefit plans, and thepercentage of unused flex creditsthey can add to their taxable wages.

Defining Flex Salary Parameters Tasks to define the parameters theapplication uses to determine eachemployee�s salary for flex creditcalculations.

Defining Flex Credit Tables Tasks to define the age, years ofservice, lifestyle and dependent ratetables. You can assign flex creditsbased on any of these tables.

Defining Flex Credits based onAge

Tasks to assign flex credits basedon age.

Defining Flex Credits based onService

Tasks to assign flex credits based onthe number of years an employee isemployed with your company.

Defining Flex Credits based onDependents

Tasks to assign flex credits basedon the number of employeedependents.

Defining Flex Credits based onLifestyle

Tasks to assigned flex credits basedon the number of an employee�slifestyle credits.


Figure 8. Procedure relationship: Setup: Flex Plans

Define spending onlyflex plan

Define flex credits

Define full flex plan

Define flex credit salaryparameters

Or

Define flex age credits

Define flex servicecredits

Define flex dependentcredits

Define flex lifestylecredits

Define flex credit tables

Defining Spending Account Only Flex PlansUse this procedure to define a spending account only flex plan. When youdefine a spending account only flex plan, you can identify an employee groupto further define employee eligibility.




STEPS To define spending account only flex plans1. Access Flex Plan (BN06.1).

Figure 9. Form clip: Using BN06.1 to define spending accounts

2. Select the Company from the Company field.3. Type the code and the description that represents the flex plan.4. Optional: If you want to identify a specific employee group for the plan,

select the group you want from the Employee Group field. If you leaveEmployee Group field blank, all employees become eligible.

5. Select Yes in the Spending Account Only field.6. Select the frequency table from the Frequency Table field. If you haven�t

defined a frequency table see "Defining Frequency Tables" on page 52 formore information.

7. Select the currency you want to assign to the flex plan in the Currency field.8. Choose the Add form function.

Related Reports and InquiriesTo UseList all flex plans Flex Plan Listing (BN206)

Defining Full Flex PlansUse this procedure to define a full flex plan. You can define different amountsof flex and pretax credits based on employee groups so employees indifferent employee groups can participate in the same flex plan but receivedifferent amounts of flex credits.




STOP Before you can define a full flex plan you must define Flex PayCodes. For further information see the Payroll User Guide.

STEPS To define full flex plans1. Access Flex Plan (BN06.1).

NOTE During initialsetup the display fieldsin the core plans partof the form are blank.After you define yourcore plans on BenefitPlan (BN15.1), and thecore benefit plansassociate with the flexplan, information willappear on the form.

2. Select the Company from the Company field.3. Type the code and the description that represents the flex plan.4. Complete the Flex Parameters. Consider the following fields.

Start Date Type the month and day you want the plan tobegin. Flex plans are based on 12-month periods.

Employee Group If you want to identify a specific employee groupfor the plan, select the group.

If you leave this field blank, all employeesbecome eligible for this flex plan.

Spending AccountOnly

Select No.

Frequency Table Select the frequency table that you wantassociated with the flex plan.

Flex Pay Code Select the flex pay code to use when unspentflex credits are paid out as taxable income. Thisfield is required even if unspent flex credits areforfeited.

Currency Select the currency you want to assign to the flexplan. If the company is not multi currency youcan leave the field blank. The company currencydefaults.

IMPORTANT A currency must be associated to aplan. The default currency is the currency definedfor your company. If your company does not usemulti-currency, then the flex plan currency mustmatch the company currency.


Related Reports and InquiriesTo Use

List flex plans Flex Plan Listing (BN206)


Defining Flex CreditsThis procedure defines the basis on which employees receive flex creditsin a flex plan that issues credits before the employees make their benefitelections. A flex credit record must be defined for all full flex plans in order toenroll employees, even if employees receive some or all of their flex creditsby enrolling in benefit plans. For more information, see " Setup: BenefitsPlan" on page 79 and " Setup: BN Plan Contributions" on page 147.




� "What Happens to Unspent Flex Credits?" on page 59

STEPS To define flex credits

STOP Before you can define flex credits, you must define the full flex plan.See "Defining Full Flex Plans" on page 62 for more information.

1. Access Flex Credits (BN08.1).

Figure 10. Form clip: Using BN08.1 to define flex credits

2. Select the Company in the Company Field.3. Select the Flex plan in the Flex Plan field. This is the same flex plan you

defined on Flex Plan (BN06.1).4. Type the start date for the flex credit. You type day, month and year. The

month and day must be the same as the flex plan�s start date in Flex Plan(BN06.1).

5. Fill out the Flex Credits parameters. You can give flex credits as both abase amount and percent of salary. Consider the following fields.


Base Amount If the plan gives a base amount of flex credits toemployees in a group, type the amount you wantto give as credit. Also select the employee groupname in the Employee Group field.

Leave this field blank if you type 100 in the BasePercent of Salary field.

Base Percent ofSalary

If the plan gives a base percent of salary of flexcredits to employees in a group, type the percentof an employee�s salary you want to give ascredit. Also select the employee group name inthe Employee Group field.

NOTE To base credit only on an employee�ssalary leave Base Amount blank.

IMPORTANT If you enter a value here you mustdefine the flex salary parameters, see "DefiningFlex Salary Parameters" on page 67.

Unspent TaxableCredits

Type the percent of unspent flex credits thatemployees can add to their gross pay as taxableincome.

IMPORTANT If you leave this field blank,employees lose all unspent flex credits.

Minimum TotalCredits

This field is optional and you can leave it blank.

Type the minimum flex credits an employee canreceive. If the total flex credits calculated for anemployee is less than this amount, the employeereceives this amount.

Maximum TotalCredits

This field is optional and you can leave it blank.

Type the maximum flex credits an employeecan receive. If the total credits calculated foran employee are greater than this amount, theemployee receives this amount.


TIP Enter pre-taxamount large enough tocover at least two timesthe maximum amountany employee couldspend on benefits. If theemployee has spent allhis or her dollars andhad a benefit change,the application assumesthe credits have beenspent.

6. Fill out the Pretax Credits parameters. Consider the following fields.

Amount Type the maximum amount an employee canspend from their regular pretax earnings topurchase benefits.

If there is no limit, leave this field blank.

Percent of Salary Type the maximum percent of regular pre-taxearnings an employee may spend to purchasebenefits.

If employees can spend a percent of their salaryon a pretax basis to purchase benefits, type thatpercent.

If there is no limit, type 100.


Options for defining flex creditsThe following options are available from Flex Credits (BN08.1).

Choose the Comments button to access Comments (BN90.1). Use this formto type comments about the flex plan, flex credits, or an employee�s benefit.

Choose the Salary button to access Flex Salary Parameters (BN08.2). Usethis form to determine how the application calculates an employee�s salary.See "Defining Flex Salary Parameters" on page 67.

Choose the Age button to access Age Credits (BN08.3). Use this form to giveflex credits based on employees age. See "Defining Flex Credits Based onAge" on page 72.

Choose the Service button to access Service Credits (BN08.4). Use this formto give employees flex credits based on the number of years they haveworked at your company. See "Defining Flex Credits Based on Years ofService" on page 74.

Choose the Dependents button to access Dependents Credits (BN08.5). Usethis form to define the number of credits employees receive based on theirnumber of dependents. See "Defining Flex Credits Based on Dependents" onpage 75.

Choose the Lifestyle button to access Lifestyle Credits (BN08.6). Use thisform to assign employee�s flex credits based on lifestyle. See "Defining FlexCredits Based on Lifestyle" on page 76.

Related Reports and InquiriesTo UseList Flex Plans Flex Plan Listing (BN206)


Defining Flex Salary ParametersThis procedure defines the parameters the application uses to calculate anemployee�s salary. If you entered a value in the Base Percent of Salary fieldin the Flex Credits form, then complete this form.

STOP Before you define the salary tables, define the basic flex creditinformation. See "Defining Flex Credits" on page 64.




STEPS To define flex salary parameters1. Choose the Salary button, on Flex Credits (BN08.1), to open Flex Salary

Parameters (BN08.2).

TIP If you enter a valuein the Base Percent ofSalary field on FlexCredits (BN08.1), awindow automaticallyopens, with this form,when you add the FlexCredit record.

Figure 11. Form clip: Using BN08.2 to define flex salary parameters

2. Select the salary type you want to use for the flex credit calculation in theType field. The following table explains the different salary options.

Select To use

Employee Salary The employee�s annualized rate ofpay from HR11.1 (Employee) or,if applicable, the employee�s stepand grade schedule.

Benefit Salary The benefit salaries from theBenefit form tab of HR11.1.

Emp and Ben Sal The employee�s annualized rateof pay from HR11.1 plus a benefitsalary. You use this option if onlysome of your employees in thisplan will need to have a benefitsalary amount maintained, such asemployees paid on commission.


3. Select the date you want to use to determine employee salaries in the Datefield. The table below explains the date options.

Select To determine an employee�ssalary

Current on the system date flex credits arecalculated.

First of Month on the first of the month flex creditsare calculated.

As of Date on a particular month and day.The application uses the monthand day that you specify in the ASof MMDD field.

4. Complete the form. Consider the following fields.

As of MMDD andYear

Type the date you want to use to determine anemployee�s salary for coverage calculations.� If you selected As of Date in the Date field,

type the month and day.� If you leave the Year field blank when you

use the As of Date, the application calculatesan employee�s salary on the latest monthand day specified.

� If you type a Year, the employee�s salary isdetermined on the exact month, day, andyear you specify.

� If an employee does not have a salary historyfor the date specified, the application usesthe current salary.

Minimum andMaximum

Type the minimum and maximum salary amountsfor calculating flex credits. If an employee�s salaryis either less or greater than these amounts, theapplication uses these amounts to calculate flexcredits for the employee.

Method This is a required field. If you do not want theapplication to use any rounding methods, suchas rounding numbers up and down, select NoRounding.

5. Choose the OK button.6. Choose the Add form function or select another credit table to fill out.


Defining Flex Credit Rate TablesNOTE Age and servicerate tables are alsoused to define companyand employee costsfor a benefit plan. Formore information, see"Defining ContributionRate Tables" on page158

You use rate tables to define flex credit amounts based on age, service,number of dependents, and lifestyle credits. The application calculates theflex credits using either an amount or percent.

When you assign a rate table to a benefit plan�s flex credit record, the ratetable�s start date must match the start date of the flex credit record.

STEPS To define flex credit rate tables1. Access Rate Table Menu (BN02.1).2. If you want to base flex credits on age, select Age Rate Table.3. Define the age rate table. Consider the following fields.

Company Select the company.

Table Type a code and description that represents therate table in the Table field.

Rate table codes must be unique among ratetable types. For example, if the code for an agerate table is 2A, another type of rate table cannotalso use the code 2A.

Start Date Type the start date of the rate table.

The same rate table can have many start datesto accommodate rate changes. When you assigna rate table to a flex credit record, the rate table�sstart date must match the start date of the flexcredit record. If you add a new rate table witha new start date, you must also add a new flexcredit record.

Currency Select the currency you want to assign to this ratetable. If you leave this field blank, the companycurrency defaults, only if the company is not multicurrency.

IMPORTANT Any rate table associated with aflex plan must have the same currency as theflex plan.


Beg Age Type the starting age for the flex credits you aredefining. The application calculates the endingage for the age range. At least one age rangeis required.

NOTE Leave this field blank to begin the firstrange with zero.

Flex Credits Type the amount you want to give as flex creditsnext to the corresponding age range.

4. Choose the Add form function5. If you want to base flex credits on service, select Service Rate Table.6. Define the service rate table. Consider the following fields.









Beg Year Type the lower value of the years-of-servicerange for the flex credits you are defining. Theapplication calculates the ending year of servicefor each range. At least one years-of-servicerange is required.

NOTE Leave this field blank for the first rangeto begin with zero.

Flex Credits Type the amount you want to give as flex creditsnext to the corresponding year of service range.

7. Choose the Add form function.8. If you want to base flex credits on dependents or lifestyle credits, select

Credits Rate Table.9. Define the credit rate table. Consider the following fields.









Beg Nbr Type number of dependents or lifestyle creditsfor this range.

Flex Credits Type the number of flex credits employeesreceive for the number of dependents or lifestylecredits indicated on this detail line.

The lifestyle credits are entered and maintainedon HR11.


Defining Flex Credits Based on AgeYou can define flex credits based on the following credit tables: Age, service,dependents and lifestyle. This procedure outlines the tasks to define yourflex credits based on age.

STOP Before you define flex credits based on age, define the basic flexcredit information. See "Defining Flex Credits" on page 64.




STEPS To define flex credits based on age1. Choose the Age button, on Flex Credits (BN08.1), to open Age Credits

(BN08.3).

Figure 12. Form clip: Using BN08.3 to define flex credits based on age

2. Select the date you want to use to determine employee age in the Datefield. The table below explains the date options.


Select To determine an employee�s age





As of MMDD andYear

Type the date you want to use to determine anemployee�s age for flex credit calculation.� If you selected As of Date in the Date field,


use the As of Date, the application calculatesan employee�s age on the latest month andday specified.

� If you type a Year, the employee�s age isdetermined on the exact month, day, andyear you specify.

Rate Table Select the table you want the application to useto calculate flex credits.

Credit Per To give flex credits using the employee�s annualsalary rather than a flat amount, type the salaryamount for each credit. The application calculatescredits as follows: employee�s salary/Credits Per* Credits.

If you leave this field blank, age credits are a flatamount.

Method If you don�t want the application to use anyrounding methods, select No.

Minimum andMaximum

Type the minimum and maximum credits anemployee can receive based on age. Minimumand maximum credits apply only when credits arecalculated based on the salary amount enteredin the Credit Per field.

4. Choose the OK button.5. Choose the Change form function for Flex Credits (BN08.1).


Defining Flex Credits Based on Years of ServiceYou can define flex credits based on the following credit tables: Age, service,dependents and lifestyle. This procedure outlines the tasks to define your flexcredits based on years of service.

STOP Before you define flex credits based on years of service, define thebasic flex credit information. See "Defining Flex Credits" on page 64.




STEPS To define flex credits based on years of service1. Choose the Service button, on Flex Credits (BN08.1), to open Service

Credits (BN08.4).2. In the Date field, select the date you want to use to determine employee

years of service. The table below explains the date options.

Select To determine an employee�syears of service






As of MMDD andYear

Type the date you want to use to determinean employee�s years of service for coveragecalculations.� If you selected As of Date in the Date field,


use the As of Date, the application calculatesan employee�s years of service on the latestmonth and day specified.

� If you type a Year, the employee�s years ofservice is determined on the exact month,day, and year you specify.


Credit Per To give flex credits using the employee�s annualsalary rather than a flat amount, type the salaryamount for each credit. The application calculatescredits as follows: employee�s salary/Credits Per* Credits.

If you leave this field blank, years of servicecredits are a flat amount.

Minimum andMaximum

Type the minimum and maximum credits anemployee can receive based on their years ofservice. If the calculated credits are less orgreater than these amounts the application givesthis amount of credits to the employee.

4. Choose the OK button.5. Choose the Change form function on Flex Credits (BN08.1).

Defining Flex Credits Based on DependentsYou can define flex credits based on the following credit tables: Age, service,dependents and lifestyle. This procedure outlines the tasks to define yourflex credits based on the number of dependents.

STOP Before you define flex credits based on dependents, define the basicflex credit information. See "Defining Flex Credits" on page 64.





STEPS To define flex credits based on dependents1. Choose the Dependents button, on Flex Credits (BN08.1), to open Depen-

dents Credits (BN08.5).2. Select the date, you want to use to determine number of dependents in the

Date field. The table below explains the date options.

Select To determine an employee�snumber of dependents





As of MMDD andYear

Type the date you want to use to determine anemployee�s number of dependents.� If you selected As of Date in the Date field,


use the As of Date, the application calculatesan employee�s number of dependents on thelatest month and day specified.

� If you type a Year, the employee�s numberof dependents is determined on the exactmonth, day, and year you specify.



Defining Flex Credits Based on LifestyleYou can define flex credits based on the following credit tables: Age, service,dependents and lifestyle. This procedure outlines the tasks to define your flexcredits based on lifestyle.


STOP Before you define the flex credits based on lifestyle credits, definethe basic flex credit information. See "Defining Flex Credits" on page 64.You also need to define the employee�s lifestyle credits on the EmployeeBenefits form tab (HR11.1). See the Human Resources User Guide formore information.





STEPS To define flex credits based on lifestyle1. Choose the Lifestyle button on Flex Credits (BN08.1), to open Lifestyle

Credits (BN08.5).2. Select the date in the Date field, you want to use to determine employee

lifestyle credits. The table below explains the date options.

Select To determine an employee�slifestyle credits





As of MMDD andYear

Type the date you want to use to determine thenumber of lifestyle credits.� If you selected As of Date in the Date field,


use the As of Date, the application calculatesan employee�s number of lifestyle credits onthe latest month and day specified.

� If you type a Year, the employee�s number oflifestyle credits are determined on the exactmonth, day, and year you specify.




Chapter 7

Setup: Benefits PlanThis chapter focuses on procedures to set up your benefits plans. Whendefining benefits plan parameters, you are structuring the plan. Benefits plansuse several different features in the Human Resources application.

If you are upgrading your application from release 7.2.x to release 8.0.x, seethe Upgrade Information Packet (UIP) for complete information about whattasks you need to complete before using this application. The UIP is availablefrom your Lawson Client Manager.

Employee groups, defined in the Human Resources application, are used toidentify eligibility, entry rules, coverage, contributions, and general ledgeroverrides.

Deduction codes, pay classes, and pay codes are used from the Payrollapplication:

� to track employee and company expenses

� to track hours for eligibility, vesting, compensation and dollars for contribu-tions

� allocation of flex credits and computed income amounts that are added toemployee�s taxable wages

STOP Before you set up you must define the employee groups onEmployee Group Definition (HR55) and Eligibility Postal Codes (BN11) postalcodes. The Benefits Administration application uses the information enteredon HR55 and BN11 as part of employee benefit eligibility.

Benefits Administration User Guide Chapter 7 Setup: Benefits Plan 79



BNProcesses

MaintainingBN Plans

PlanMaintenance

Flex Plans

Employees

BN PlanEnrollment

BN Company

Preliminaries

Setup

Flex Plan

BN-Plans

BNAutomation

Rules

MaintainEmployee

Enrollments


SavingsBond

Update

Benefit PlanTesting


SpecialProcessing


BN-PlanCoverage



Retirees

You Are Here

BN EntryRules

80 Chapter 7 Setup: Benefits Plan Benefits Administration User Guide




� "What is a Plan Type?" on page 81

� "What are Benefit Categories?" on page 81

� "What are Some Basic Plan Type Characteristics?" on page 82

� "What are Coverage Types?" on page 84

� "What are Contribution Types?" on page 85

� "What Contribution and Coverage Types Work Together?" onpage 87

� "How are Deductions used by Benefit Plans?" on page 88

� "What is a Default Plan?" on page 89

� "What Determines Eligibility?" on page 90

� "Why Use Employee Groups with Benefit Plans?" on page 90

� "What are Waive Plans?" on page 91

� "What are Flex Core Plans?" on page 92

� "What are Benefit Dates?" on page 92

What is a Plan Type?Plan types in the Lawson application determine how a plan is set up and thefeatures and reporting available for the plan. The table below lists the plantypes available in the Benefits Administration application.

Health Savings Bond

Dental Stock Purchase

Disability Spending Accounts

Employee Life Vacation

Dependent Life Defined Contribution

Defined Benefit

What are Benefit Categories?Use benefit categories to further define plans. Categories enable theapplication to default benefits. Categories are also used for reporting. For


example, you can further define employee life plans with the categories lifeor Accidental Death and Dismemberment (AD&D). You can define a defaultlife plan and a default AD&D plan.

The table below lists the predefined categories.

Profit sharing Short term disability (STD)

Money purchase Long term disability (LTD)

ESOP Life

401(k) Sell vacation

403(b) Medical

457 Long term care

Thrift or Savings Vision

Registered retirement savingsplans

Medical reimbursement

Deferred profit sharing Dependent care

Legal account Buy vacation

Accidental life and dismember-ment (AD&D)

In addition to the predefined categories available in the Benefits Administrationapplication, you can define your own categories.

What are Some Basic Plan Type Characteristics?The table below lists important plan attributes and available categories. See"What are Coverage Types?" on page 84 for more information.

Plan Type Pre-definedCategories

Attributes

Defined Benefit Participation hours

Covered compensationby plan year

Vesting

Beneficiaries



Attributes

Defined Contribution Profit sharing

Money purchase

ESOP

401(k)

403(b)

457

Thrift or Savings

Registered RetirementSavings Plans

Deferred Profit Sharing

Participation hours

Covered compensationby plan year

Vesting

Beneficiaries

Investment accounts

Discrimination testing

Dental Dependents benefits

Dependent Life Dependent benefits

Beneficiaries

Used to calculateimputed income

Disability STD (short termdisability)

LTD (long termdisability)

Beneficiaries

Employee Life Life

AD&D (Accidental Lifeand Dismemberment)

Used to calculateimputed income

Health Medical

Long term care

Vision

Dependents benefits

Spending Account Medical reimbursement

Dependent care

Legal account

Payroll updates planyear contributions

Allows reimbursementTransactions

Savings Bond Payroll updatescontributions by plan

Purchases bonds

Tracks owners,co-owners andbeneficiaries

Maintains bond history



Attributes

Stock Purchase Payroll updatescontributions by plan

Purchases stock

Maintains stockpurchase history

Vacation Buy vacation

Sell vacation

Buy or sell hours in atime accrual plan

What are Coverage Types?When you set up your benefit plan, you identify what kinds of coverage youwant to offer your employees. Lawson enables you to use three types ofcoverage to set up your plan.

The list below describes the three coverage types.

Type DescriptionNo Coverage (0) No coverage is offered under the

benefit plan. You would use NoCoverage for benefit plans likedefined contribution and spendingaccounts that have employeecontributions but no coverage.

Coverage Options You define the specific options thatan employee may choose uponenrollment.

For example, a health plan mightoffer options such as single,employee + 1 and family.

Coverage Amounts A coverage amount is determined inone of several ways. You can definea coverage amount as a specific flatamount, a chosen amount basedon set increments, or a calculationusing a percent or multiple of anemployee�s salary.

For example, you can define anemployee life plan in which anemployee can elect a coverageamount of one to five times his orher salary. Or, a disability plan thatoffers coverage as a percent of anemployee�s salary.


NOTE You have theoption of using acustom calculation fordetermining coverage.Custom calculationsuse the User Exitsfunctionality. Formore information,see the ApplicationDevelopmentWorkbench Standards.

The coverage type is then used in conjunction with contribution types tofurther define a benefit plan.

No Coverage ExampleRiver Bend Hospital�s 401(k) plan is based on employee contributions.

To define this plan, River Bend would select No Coverage to be entered inthe Coverage Type field.

Coverage Option ExampleRiver Bend Hospital has a health plan that has the following coverage options:

� Employee

� Employee plus one

� Employee plus two

� Employee plus three

� Full family

� Medicare supplement

To define this plan, River Bend would select Coverage Options to be enteredin the Coverage Type Field.

Coverage Amount ExampleRiver Bend Hospital�s Supplemental Life plan allows employees to selectcoverage in $5,000 increments up to a maximum coverage of $75,000 up tothe age of 60. After age 60, the coverage is reduced by 50 percent.

To define this plan, River Bend would select Coverage Amounts to be enteredin the Coverage Type field.

What are Contribution Types?For each plan, you can define unique contributions. Lawson offers six differentcontribution types. Contributions can be flat amount premiums, amountscalculated by the application, or amounts determined by the employee. See"Contribution Type Examples" on page 86 for more information.

The following are the types of contributions you can define.

Type DescriptionOptions Amount (1) The cost for each coverage option is

a flat amount and is the same for allemployees in a group.


Type DescriptionOptions Amount Range (2) The cost for each coverage

option varies based on salary,age or years-of-service ranges foremployees in a group.

Flat Contributions (3) The cost is a flat amount for allemployees in a group. The cost maybe based on employee�s salary, age,years of service.

Salary or Coverage Rate Table (4) The cost is calculated by multiplyinga rate times the employee�s amountof coverage or salary. The rate maybe based on age, salary, or years ofservice.

Contribution Limits (5) Contributions are designated by theemployee, up to a specified limit.

Match Limit Schedule (6) Used for benefit plans that specifyemployee contribution limits that arematched by a company contribution.

Match Percent Schedule (7) Used for benefit plans that specifyemployee contribution limits thatare matched by the company basedon the percent of the employee�scontribution.

No Contribution (0) Use for benefit plans that will nottrack any contributions, neither bythe employee, or company paid.

Contribution Type ExamplesNOTE You have theoption of using acustom calculation fordetermining coverage.Custom calculationsuse the User Exitsfunctionality. Formore information,see the ApplicationDevelopmentWorkbench Standards.

Options Amount - For example, employees pay $400 for single coverage or$1100 for family coverage under a health plan.

Options Amount Range - For example, a company may reward years ofservice by paying a larger share of the cost of health insurance. Employeeswith less than five years of service pay $450 for single coverage, whileemployees with more than five years of service pay only $325, with thedifference being added to the company�s share of the cost.

Flat Contributions - The cost is a flat amount for all covered employeesin a group. Cost may be based on age, salary, or years of service, butdoes not vary with level of coverage. For example, a company-providedEmployee Assistance Plan has a flat cost to the company of $100 for eachcovered employee.

Salary or Coverage Rate Table - The cost is calculated by multiplying a ratetimes either an employee�s salary or the amount of coverage in the plan. Therate used in the calculation may be based on age, salary, or years of service.For example, the cost of a disability plan is $.75 per $1,000 of coverage in theplan, where coverage is 60% of an employee�s base salary.


Contribution Limits - For example, a medical reimbursement account allowsemployees to contribute any amount they choose up to $2,000 per year.

Match Limit Schedule - Used for benefit plans where employee contributionsare matched by the company up to a specific limit. The match is determined asa percentage, and may vary based on years of service. For example, a 401(k)plan where an employee may contribute up to 15% of their eligible earningsand the company match is 50% of the employee�s contributions up to 8%.

Match Percent Schedule - Used for benefit plans where employeecontributions are matched by the company, and the amount of the matchvaries over the range of possible contribution levels. For example, a 403(b)plan where an employee may contribute up to 12% of their eligible earnings,and the company match is 100% on the first 1%, an additional 60% on thenext 4%, and an additional 40% on the next 2% of contribution.

No Contributions (0) - Used for benefit plans that will not track any companyor employee expense associated with the plan. For example, a visiondiscount plan for which the company pays a flat annual fee. Cost will not betracked based on enrollment in the plan, only coverage.

What Contribution and Coverage Types Work Together?The table below lists contribution and coverage types that you can combinewhen you set up you benefit plan. The coverage type you select determineswhich contribution type you can select.

Coverage Type

Contribution 0

No Coverage

1

CoverageOptions

2

CoverageAmounts

0 NoContribution

X X

1 OptionsAmount

X

2 OptionsAmount Range

X

3 FlatContribution

X X

4 Salary orCoverage RateTable

X

5 ContributionLimits

X

6 Match LimitSchedule

X

7 Match PercentSchedule

X


How are Deductions used by Benefit Plans?The Benefits Administration application uses deductions to:

� track employee and company contributions on a pay period basis

� determine to which general ledger accounts the plan�s cost should beposted

NOTE If you wanttransactions forparticular employeesposted to differentgeneral ledgeraccounts, you canoverride (by employeegroup) the generalledger accounts that aredefined on deductions.See "Overriding GeneralLedger Accounts" onpage 108

You assign deductions to benefit plans; each deduction can be assignedto only one benefit plan.

The following list explains the use of each type of deduction. You can defineeach type of deduction as an amount or a percent. The deductions you usefor a plan depends on the contribution type you select for a plan and howyou define the contribution.

The list below describes the deductions.

Pretax Tracks employee pretaxcontributions.

After limit Tracks employee after-taxcontributions for 401(k) and403(b) plans when the employeehas met the pretax limit.

If the Use AT Limit Deductionsfield in the Options form tab ofHR00.1 (Company) is No, afterlimit deductions are not valid; theapplication continues to use pretaxdeductions on an after-tax basis.

After-tax Tracks employee after-taxcontributions.

Company Tracks the company contributionwhen the company contributionis not a match of the employeecontribution.

Company Match Pretax Tracks the company contributioncalculated as a match of theemployee pretax deduction.

Company Match After-limit Tracks the company contributioncalculated as a match of theemployee after-limit deduction.

Company Match After-tax Tracks the company contributioncalculated as a match of theemployee after-tax deduction.

Flex company (for flex plans only) Tracks the company�s cost when anemployee uses flex dollars to payfor a benefit.


What is a Default Plan?A default plan lets the Benefits Administration application automatically enrollemployees when they become eligible. There are four default types you canuse to define a default plan. The table below describes the four types.

Type DescriptionAlways default Benefit update programs enroll

an employee when the employeebecomes eligible.

By plan type Benefit update programs enroll aneligible employee if the employeehas no other benefits of the sameplan type (for example, no otherhealth plan).

By plan category Benefit update programs enroll aneligible employee if the employeehas no other benefits of thesame plan type and category (forexample, no other spending accountplan with the category �medicalreimbursement�).

Do not default Benefit update programs do notautomatically enroll an employee. Amass enrollment program will list,but not enroll, employees who areeligible for the plan.

Example of Always DefaultThe B & B Clothing Company gives all eligible employees $10,000 of lifeinsurance coverage in the basic life plan regardless of any coverage theemployee elects in the supplemental life plan.

Example of Default by Plan CategoryUnder the benefit plan type for employee life insurance, the Johnson BookStore offers their employees two life plans and one AD&D plan identified byplan categories. An employee can chose from within the life plans to receiveeither a $15,000 flat amount of coverage or a multiple of their salary. The flatamount life plan is defined to default by plan category. If the employee doesnot choose the multiple of life plan, the update program will automaticallyenroll them in the flat amount plan.


What Determines Eligibility?Employee groups and postal code tables allow you to indicate employeeeligibility. An employee must meet all of a plan�s eligibility requirements toenroll in the plan. Also, the employee�s currency and country must match theplan�s currency and country.

The following list explains the use of each type of eligibility criteria.

Employee group Assigning an employee group to aplan limits the plan�s eligibility toemployees in the employee group.You can associate retirees to anemployee group.

Benefit postal codes Assigning a postal code table to aplan limits the plan�s eligibility toemployees with a benefit postal codethat matches one in the plan�s postalcode table. Benefit postal codes aremaintained on the employee masterrecord in the Human Resourcesapplication.

Why Use Employee Groups with Benefit Plans?An employee group is a user-defined group of employees based on specificcriteria, or employees grouped manually by employee number.

You can use employee groups in the Benefits Administration application forthe following:

� Eligibility criteria for flex plans. For example, only full-time employees areeligible for a flex plan.

� Eligibility criteria for benefit plans. For example, only nonunion employeesare eligible for participation in a self-funded short-term disability plan.

� Criteria for the calculation of flex credits. For example, employees in theMidwest receive $1,000 flex credits to purchase benefits while employeeson the West Coast receive $1,500.

� Waiting periods. For example, there is a 60-day waiting period for part-timeemployees and no waiting period for full-time employees.

� Coverage. For example, union employees can choose life insurance cov-erage at one, two, or three times their salary, while nonunion employeescan choose between one to five times their salary in coverage.

� Contributions. For example, contributions are $1,000 for employees in theMidwest and $2,000 for employees on the West Coast.

� General ledger overrides. For example, benefit transactions for executiveemployees are posted to unique general ledger accounts.


� Benefit automation rules. For example, a full-time employee at ABC Foodsswitches to part-time, thereby making him ineligible for benefit coverage.The Benefits Administration application stops his benefits based on theautomation rules defined for the personnel action that changes him from afull-time to a part-time employee.

You will normally want to include an employee group on the Eligible tab ofBenefit Plan (BN15.1). This is considered the main eligible group, and if youare using benefit automation rules, this group is required on the plan. At aminimum, terminated employees are usually not eligible for benefit plans; inthis case, you would use an employee group to identify only active employeesas being eligible for the plan.

Aside from eligibility, employee groups may be used many places withinthe Benefits Administration application to define different parts of a givenplan uniquely for different groups. If the different parts of the plan, such ascoverage or contributions, do not vary by group, you do not need to attach agroup to these records. A record defined with no employee group attachedwill apply to all employees in the main eligible group for the plan. To preventunnecessary setup and maintenance, Lawson Software recommends thatyou only attach a group when needed.

When varying parts of a benefit plan by employee group, make certain thatyou define mutually exclusive groups for each of the records, so that only onerecord will apply to each employee in the plan.

For example, if you define waiting periods for a group of salaried employeesand for a group of part time employees, define the employee groups assalaried full-time and salaried part-time. This ensures that an employee willnot qualify for more than one waiting period. If more than one waiting periodapplies to an employee, the Benefits Administration application displaysan error message at benefit entry.

What are Waive Plans?A waive plan tracks employees who decline coverage in a plan or plans. Itcan be a default plan for employees who do not elect a benefit plan at thetime of enrollment. Under a flex plan, you can give an employee flex creditsfor waiving coverage.

IMPORTANT For benefit enrollment on the web, waive plans are necessaryanytime an employee may choose to decline coverage within a group of plans.

ExamplesInternational Technical Services Inc., (ITS) has set up health and dental waiveplans. All employees at ITS who choose not to enroll in health and dentalbenefits are enrolled in the waive plan so ITS can track these employees.


The Perex Company has a flex benefit plan. They enroll employees who donot chose health and dental plans in a waive plan to allocate flex credits forwaiving coverage.

What are Flex Core Plans?This is the minimum coverage an employee must elect under a flex plan. Ifa core plan exists, an employee cannot waive coverage. However, for flexhealth and dental plans, you can let an employee waive a core health ordental flex benefit in favor of the spouse�s health or dental plan.

What are Benefit Dates?You can use various dates to determine when an employee can enroll in aplan. Waiting periods and enrollment requirements on benefits plans can bebased on the following employee dates.

� Hire

� Adjusted hire

� Anniversary

� Seniority

� Five user-defined benefit dates

ExampleRiver Bend Hospital uses the hire date field on Employee to store the originalhire date of the employee. The adjusted hire date is used in a re-hire situationas the date the employee is re-hired at River Bend. The seniority date is adate calculated to reflect the employee�s combined time of service.

The eligibility date for the 401(k) plan at River Bend for a new hire iscalculated from the employee�s hire date. If an employee leaves River Bendand is subsequently re-hired, the adjusted hire date is used to calculate thewaiting period for that re-hired employee in the 401(k) plan. The seniority dateis used to calculate years of service for determining the company match.


Procedures in this ChapterThe procedures in this chapter provide instructions to define your benefit planparameters. When you define a benefit plan, you identify the benefit typeand then define specific parameters for that benefit type. For each plan, youdefine coverage and contribution types. Entry rules, coverage, contributions,and general ledger overrides of the deduction accounts can be unique byemployee groups.

Defining Benefit Categories Tasks to define categories for benefitplans.

Defining Primary Benefit Plan Tasks to define the primaryinformation every benefit plan uses.

Defining Vesting and CoveredCompensation

Tasks to define compensation,vesting and reporting requirementsfor defined contribution and definedbenefit plans.

Defining Investment Options Tasks to define investment accountsfor defined contribution plansthat offer employees a choice ofaccounts in which they can investcontributions.

Overriding General LedgerAccounts

Tasks to override the general ledgeraccounts on deductions an paycodes for an employee group.


Figure 13. Procedure relationship: Setup: Benefit Plans

Define primary benefitinformation

Define benefitcategories

Define Vesting andCovered

Compensation

Define general ledgeroverrides

Define InvestmentOptions

Defining Benefit CategoriesCategories enable you to further define your benefit plans. Categories areassociated with a plan type, and the application uses categories for creatingdefault benefits and for reporting. The Benefits Administration application isdelivered with several pre-defined categories. This procedure outlines thetasks to define additional benefit categories.



STEPS To define benefit categories1. Access Benefit Plan Categories (BN13.1).2. Select the plan type from the Plan Type field.3. Type the code you want to represent the category in the Category field.4. Type the category description in the Description field.5. Choose the Change form function.


Defining a Primary Benefit PlanThis procedure outlines those tasks to define the primary benefit plan.You candefine plans for employees, dependents, retirees, and COBRA participants.You use Benefit Plan (BN15.1) to define the primary benefit plan. There areeight tabs containing essential benefit plan information.

When you define the primary benefit plan, you define the information for eithera Flex or a Non-Flex plan. For a Flex plan you enter information on the Main,Eligible, Deduct, and Flex tabs. For a Non-Flex plan you enter informationon the Main, Eligible, and Deduct tabs. Depending on the information youentered on the four main tabs, you might also need to enter information on theVest Comp, Bill Acct, Misc or Invest.

The table below describes those tabs.

Tab Purpose Flex OnlyMain Indicates the type of

benefit plan you aredefining.

Eligible Indicates who is eligiblefor the benefit plan.

Flex Indicates if the benefitplan is under a flexplan. If employeesreceive flex credits forelecting the benefitplan, you can select apay code to track thosecredits.

Yes

Vest Comp Defines compensation,vesting and reportingrequirements fordefined contributionand defined benefitplans.

Deduct Select the benefitplan�s frequency tableand deductions.

Bill Acct Select general ledgeraccounts for invoicingCOBRA participant andretiree contributions.Use this form tabonly if the RetireesCovered or the COBRAParticipants Coveredfield on the Eligibilityform tab is Yes.


Tab Purpose Flex Only

Misc Indicate whether alife insurance planis included in thecalculation of imputedincome, to indicatethe value and costof savings bonds,to define spendingaccount transactionlimits, or to associatea vacation plan with atime accrual plan. Youcan also associatea Canadian planregistration numberfrom this tab.

Invest Define investmentaccounts for definedcontribution plans thatoffer employees achoice of accounts inwhich they can investcontributions.





� "How are Deductions used by Benefit Plans?" on page 88

� "What are Waive Plans?" on page 91

STEPS To define primary benefit plan1. Access Benefit Plan (BN15.1).2. Select the company from the Company field.3. Select the plan type from the Plan Type field.

If the plan is Then

Reserve spending Choose the Misc tab and selectReimbursement.

Saving Bond Choose the Misc tab and type thevalue and cost of the saving bond.


If the plan is Then

EL or DL Choose the Misc tab and selectYes if imputed income.

For Canadian Plans

T4-RPP or DPSP

Choose Misc tab and type the planregistration number.

TIP The applicationidentifies benefit plansby plan type and plancode. You can use thesame plan code for thedifferent plan types youdefine.

4. Type the code that represents the benefit plan.5. Enter the plan�s basic information on the Main tab.

Figure 14. Form clip: Using BN15.1 Main tab to define primary benefit plan

Consider the following fields.

Category Select a category for the benefit plan.

If you define the plan to default by plan category,this field is required.

Start Date Type the starting date for the plan. This is theearliest date any enrollment in the plan can occur.

For defined contribution and defined benefitplans, the month and day of the start datedefine the beginning date for each plan year.Compensation, DC/DB account balances, andvesting, are tracked based on the plan year.

Stop Date If there is a date after which employees are nolonger able to enroll in the plan, type the stopdate for the plan.

Coverage Type Select the coverage type for the plan.

Contribution Type Select the plan�s contribution type. Thecontribution type you can select depends on thevalue you selected in the Coverage Type field.


Default Select the type of default plan. If you do not wantthe plan to be a default plan, select N.

Waive Select if the plan is a waive plan.

International Select the country code and the currency youwant to associate with this plan.

If you leave currency field blank, the applicationwill use currency defined for the company.

If your company uses multiple work countries,this field is required.

If your company does not use multiple workcountries, this field must match the companywork country.

You define whether or not a company usesmultiple work countries on Company (HR00.1).

IMPORTANT A benefit plan can only apply toone country and have only one currency.

6. Choose the Eligibility tab to define employee eligibility.

Figure 15. Form clip: Using BN15.1 Eligibility tab to define primary benefit plan



Covered Select if employees are eligible to enroll in thisplan.

Employee Group Select an employee group to limit the plan�seligibility to employees in the employee group.

IMPORTANT If you plan to use automation rules,you must select an employee group.

If you leave this field blank, all employees whomeet the plan�s other eligibility requirements areeligible to enroll in the plan.

If you select both an employee group and apostal code table, employees must meet botheligibility criteria to be eligible for the plan.

Retirees Indicate if retirees are eligible to enroll in this planand if you want to use an employee group todetermine retiree eligibility.

COBRAParticipants

Indicate if COBRA participants are eligible toenroll in this plan.

7. If you want to cover retirees or COBRA participants in this plan, choose theBill Acct tab and select the general ledger accounts for tracking COBRAparticipant and retiree contribution information.

8. If this plan is a Flex Plan, choose the Flex Tab.

Figure 16. Form clip: Using BN15.1 Flex tab to define primary benefit plan


Flex Plan Select the Flex plan for this benefit plan.

Flex Core Select Yes if the plan is a core benefit plan.


Reduces FlexCredits

Select a flex company deduction. If you leavethis field blank, the application does not use flexcredits to pay for the benefit.

IncreasesEmployee Pay

Select the pay code for the application to use tocreate a standard time record for the employeeusing the plan�s frequency table.

If you leave this blank, the application creates orupdates the employee�s standard time record withthe flex pay code entered on Flex Plan (BN06.1).

Pay codes, refer to Payroll User Guide forinformation about pay codes.

Vacation If you are defining a flex vacation plan andyou are using the Lawson Time Managementapplication, select the vacation plan that youwant updated with the number of hours bought orsold with the Benefits Administration application.

9. Choose the Deduction tab to attach the benefit plan�s frequency table anddeductions. If the plan is defined with a contribution of No Contribution,leave the fields on this tab blank.

STOP If you have not defined the necessary deduction codes, you mustdefine them now. Save the plan after attaching the frequency table bychoosing the Add function at this point in the procedure. After you definethe deduction, enter the codes on BN15 and choose the Change functionwhen you are done defining the plan.

Figure 17. Form clip: Using BN15.1 Deduction tab to define primary benefit plan

1. If the plan�s contributions are calculated as a flat amount or a percent ofsalary, select the Amount subtab. Consider the following fields.


Pretax If you are selecting a pretax deduction for adefined contribution plan, the deduction youselect must have a tax status as follows. For401(k) plans, the tax status must be 401(k). For403(b) plans, the tax status must be 403(b). For457 plans, the tax status must be 457.

After-Tax If employees contribute a flat amount for thisbenefit on an after-tax basis, select an after-taxdeduction.

Company If the plan contribution type is 1 to 5, selecta company deduction to track companycontributions that are a flat amount.

Company Match -Pretax

If the plan contribution type is 6 or 7 and thecompany matches employee pretax contributionsthat are a flat amount, select a company matchingdeduction.

The tax status of the company match must equalthe tax status of the corresponding employeededuction.

Company Match -After-Tax

If the plan contribution type is 6 or 7 andthe company matches employee after-taxcontributions that are a flat amount, select acompany matching deduction.

Employee If this is a defined contribution plan and anemployee�s flat amount contributions switch frompretax to after-tax after the employee has metthe 401(k) and 403(b) pretax limits, select thededuction used for the employee�s after limitcontribution. If the Use AT Limit Deductions fieldin the Options form tab of HR00.1 is No, leavethis field blank.

IMPORTANT Deductions used for after limitcontributions must be linked to the correspondingpre-tax deductions on Deductions (PR05.1).


TIP To base a percentcontribution on specifictypes of pay rather thanall pay, assign a payclass to the deductionwhen you define thededuction in Deduction(PR05.1).

2. If the plan�s contributions are calculated as a flat percent, select the Per-cent subtab. Consider the following fields.

Pretax Select the pretax. If you are selecting a pretaxdeduction for a defined contribution plan, thededuction you select must have a tax status asfollows. For 401(k) plans, the tax status mustbe 401(k). For 403(b) plans, the tax status mustbe 403(b). For 457 plans, the tax status mustbe 457.

After-Tax If employees make percent contributions on anafter-tax basis, select an employee after-taxdeduction.

Leave this field blank for benefit plans under aflex plan.

Company If the plan contribution type is 1 to 5, selecta company deduction to track companycontributions that are a percentage of eachemployee�s compensation. Leave this field blankfor benefit plans under a flex plan.

Company Match -Pretax

If the plan contribution type is 6 or 7 andthe company matches employee percentcontributions made on a pretax basis, select acompany matching deduction.



Company Match -After-Tax

If the plan contribution type is 6 or 7 andthe company matches employee after-taxcontributions that are a percent, select acompany matching deduction.


Employee If this is a defined contribution plan and anemployee�s percent contributions switch frompretax to after-tax after the employee has metthe 401(k) and 403(b) pretax limits, select thededuction used for the employee�s after limitcontribution. If the Use AT Rollover Deductionsfield in the Options form tab of HR00.1 (Company)is No, leave this field blank.

IMPORTANT Deductions used for after limitcontributions must be linked to the correspondingpre-tax deductions on Deductions (PR05.1).

3. Choose one of the following tabs.

If the plan is Then

Reserve spending Choose the Misc tab and selectReimbursement

Saving Bond Choose the Misc tab and type thevalue and cost of the saving bond.

EL or DL Choose the Misc tab and selectyes for Reportable Life if this planshould be included in the imputedincome calculations (US Only).

For Canadian Plans

T4-RPP or DPSP

Choose Misc tab and type the planregistration number.

4. Choose the Add function. If you need to define covered compensation,vesting, or investment options for defined contribution or defined benefitplans, see Additional options for defining benefit plans.

Additional options for defining benefit plansThe following options are available from the Benefit Plan (BN15.1).

Choose the Vest Comp tab to define vesting and covered compensationinformation for defined benefit and defined contribution plans. See "DefiningVesting and Covered Compensation Information " on page 104.


Choose the Invest tab to define investment accounts for defined contributionplans that offer employees a choice of accounts in which they can investcontributions. See "Defining Investment Options" on page 107.

Related Reports and InquiriesTo UseList all benefit plan information Plan Parameter Listing (BN215)

Defining Vesting and Covered Compensation InformationThis procedure outlines the tasks to define compensation, vesting andreporting requirements for defined contribution and defined benefit plans.

The Benefits Administration application maintains vesting hours using theplan year, calendar year, or employment year. Vesting hours are tracked forall eligible employees even if the employee is not currently enrolled in adefined contribution or defined benefit plan. This allows the application totrack vesting hours for employees before they enroll in a plan.



� "Contribution Type Examples" on page 86

STEPS To define vesting and covered compensation information1. Choose the Vest tab on Benefit Plan (BN15.1).

Figure 18. Form clip: Using BN15.1 Vest Tab to define vesting and coveredcompensation



Pay Class Select the pay class that determines eachemployee�s covered compensation for theplan year. The application tracks coveredcompensation for comparison against the annuallimits defined on Benefits Annual Limits (BN12.1).Covered compensation is not used to calculatecontribution amounts.

If you leave this field blank, all compensation isincluded as an employee�s covered compensationfor the plan year.

Apply MaximumLimit

If this is a 401(k) or 403(b) plan, select the valuethat indicates whether you want the LawsonPayroll application to stop each employee�scontributions when the employee�s coveredcompensation for the plan year exceeds themaximum compensation limit.

If you select Yes and an employee participatingin the plan has compensation that meets orexceeds the limit, the Payroll application reducesthe employee�s compensation used to calculatecontributions to the limit. If the Payroll applicationreduces the compensation used to calculatecontributions to zero, the Payroll application doesnot calculate a contribution for the employee. Youcan override this field for individual employees inthe Benefits form tab of Employee (HR11.1).

If you select No, the Payroll application continuesto take contributions regardless of the maximumcompensation limit.

TIP Select the Annual Limits button to changethe maximum compensation limit. This limit isdefined in Benefits Annual Limits (BN12.1) byplan year.

Schedule Select a vesting schedule for the plan.

A vesting schedule is a table that determineswhen a company�s contributions becomenon-forfeitable to an employee.


Computation Year Select the type of year that is used to determinethe vesting computation period.

If you select Calendar Year, the vestingcomputation period begins on the January 1 andends on December 31.

If you select Employment Year, the vestingcomputation period is based on the employmentdate defined in the Vesting From Date. The FromDate can be defined as an employee�s hire date,adjusted hire date, anniversary date, and so on.

If you select Plan Year, the vesting contributionperiod is based on the month and day of the planstart date.

Closing the payroll cycle Payroll Close (PR197)updates vesting based on this field.

From Date If this is a defined contribution or defined benefitplan, select the date on which vesting begins foreach employee enrolled in the plan.

Count Prior Years Select the value that indicates whether thevesting calculation includes the years anemployee has worked before the plan start date.

For example, an employee was hired in 1962and the defined contribution plan began in 1982.If you select Yes, the application includes the 20years from 1962 to 1982 in vesting. If you selectNo, the application begins vesting calculationsfrom 1982.

Pay Class Select the pay class that determines eachemployee�s vesting hours for the plan year.

If you leave this field blank, all hours are includedfor vesting calculations.

Active Last Day Select the value that indicates whether an eligibleemployee must be active on the last day of theplan year to receive a company plan contribution.


Related Reports and InquiriesTo UseList vesting schedule Vesting Schedule Listing (BN203)


Defining Investment OptionsThis procedure outlines those tasks to define investment accounts for definedcontribution plans that offer employees a choice of accounts in which they caninvest contributions. Defining investment options enables you to track theinvestment choices made by employees. This information however does notflow through to the contribution amounts.




STEPS To define investment options1. Choose the Invest tab on Benefit Plan (BN15.1).

Figure 19. Form clip: Using BN15.1 Invest tab to define investment options


InvestmentElections

Select the value that indicates whether anemployee can choose the distribution of plancontributions.

DistributionIncrements

Type the minimum percent increments employeescan distribute into an account when splittinginvestments into multiple accounts.

For example, if you type 25, employees caninvest 25.0 percent, 50.0 percent, 75.0 percent or100.0 percent of their contributions in an account.

TIP Set one of theinvestment accountsas the default.If an employeedoes not make aninvestment electionupon enrollment, allcontributions areinvested in the defaultaccount.

3. Type the Investment account information.4. Choose the Add form function.

Overriding General Ledger AccountsThis procedure outlines those tasks to override the general ledger accountson deductions and pay codes for an employee group.


IMPORTANT Lawson recommends that you review Payroll general ledgerdefaulting before using this feature.

The application uses the deductions and pay codes assigned to a plan todetermine which general ledger accounts are used to post transactions for theplan. You can override the general ledger accounts for the plan.

If you override general ledger accounts, the Payroll application uses thegeneral ledger accounts from this form when deductions are created inEmployee Deduction (PR14.1) or standard time records are created inStandard Time Record (PR30.1).


STEPS To override general ledger accountsTIP If you accessGeneral LedgerOverrides (BN20.1)through the Overridebutton on BN15.1 afterinquiring on the plan,the company, plantype, and plan fieldsare populated and theplan�s deduction andpay codes are listed.

1. Access General Ledger Overrides (BN20.1).2. Select the company from the company field.3. Complete the form. Consider the following fields.

Plan Type Select the type of plan for which you want tooverride general ledger accounts.

For example, if you want to override generalledger accounts for the deductions and paycodes of an employee life plan, select EL.

Plan Select the plan you want.

Start Date Type the start date of this general ledger overridetable.

You can vary general ledger override tablesby start date. This allows you to define uniquegeneral ledger overrides for different periods. Ifthe general ledger overrides change, add a newrecord for the new general ledger overrides.

Employee Group Select the employee group for which you want tooverride general ledger accounts.

If you are defining general ledger overrides thatare unique to a particular group of employees,select this employee group for which this overriderecord applies. If you leave this field blank,the application uses this override record foremployees who do not meet the criteria for aspecific employee group override record.

IMPORTANT If you define general ledgeroverrides by employee group, make sureemployee groups are defined such that anemployee can be a member of only one group ata time. If an employee belongs to more than onegroup for which overrides have been defined,benefit entry programs and benefit update reportsshow the situation as an error.

4. Inquire to display the deduction and pay codes relative to this plan.

5. Select the distribution company, expense, and accrual accounts thatshould override the default values for the desired deduction or pay code. Ifyou leave Exp CO or Exp Account Unit blank and select only an expenseaccount, the Payroll application uses the normal defaulting defined fordistribution company accounting units.



Related Reports and InquiriesTo UseList all BN plan information Plan Parameter Listing (BN215)


Chapter 8

Setup: Benefit Entry RulesThis chapter focuses on the procedure to define benefit entry rules. TheBenefits Administration application requires plan entry rules for employeeenrollment in benefit plans.

STOP Entry rules use pay class and employee groups to calculate benefiteligibility.

For information on defining pay classes, see the Payroll User Guide.

For information on employee groups, see HR User Guide.

Benefits Administration User Guide Chapter 8 Setup: Benefit Entry Rules 113



BNProcesses

MaintainingBN Plans

PlanMaintenance

Flex Plans

Employees

BN PlanEnrollment

BN Company

Preliminaries

Setup

Flex Plan

BN-Plans

BNAutomation

Rules

MaintainEmployee

Enrollments


SavingsBond

Update

Benefit PlanTesting


SpecialProcessing


BN-PlanCoverage



Retirees

You Are Here

BN EntryRules

114 Chapter 8 Setup: Benefit Entry Rules Benefits Administration User Guide



� "What are Benefit Entry Rules?" on page 115

� "How are Entry and Re-entry Rules Defined?" on page 115

� "What are Entry Points?" on page 115

What are Benefit Entry Rules?Entry rules are the criteria to calculate when an employee can enroll in a plan.You define a plan�s entry rules to specify the waiting period requirement, ifany, that an employee must satisfy to enroll in a plan. All plans must have atleast one entry rule defined.

How are Entry and Re-entry Rules Defined?You define entry rules for initial enrollments and re-enrollments. An initialenrollment is the first time a benefit is added for an employee in a benefittype. A re-enrollment is any time an employee is enrolled in a plan type forwhich the employee has already had a benefit.

NOTE If a plan�s entryrules change, Lawsonrecommends that youadd a new entry rulerecord for the plan. Thismethod lets you definenew rules with futuredates and provides anonline audit trail ofchanges.

When you define initial entry or re-entry rules, you indicate the beginning date(such as the hire date or anniversary date) on which the employee is eligibleto enroll in the benefit. You can add to this date a number of months, days, orhours of service an employee must work to be eligible.

For example, an employee must work 1000 hours after the hire date, beforethey are eligible to enroll. To define a particular type of hours for eligibility,you use a pay class.

You can define entry rules by employee group. For example, a unionemployee must be employed 30 days before being eligible; a non-unionemployee is eligible on the hire date.

For information on employee groups, see the HR User Guide.

What are Entry Points?Entry points determine the exact date on which an employee can enroll in aplan. If you specify entry points, an employee�s benefit start date must exactlymatch an plan entry point. Entry points may be used with or without a waitingperiod, and can include one of the following:

� Up to 12 specific entry points. This method can be used to limit enrollmentsto the first of each month, or the first of the year.


� The start date of a pay period, based on the employee�s pay plan. Thismay be the pay period prior to or after the beginning date, or (if applicable)prior to or after the waiting period is satisfied.

� The start date of a work period, based on the employee�s pay plan. Thismay be the work period prior to or after the beginning date, or (if applicable)prior to or after the waiting period is satisfied.

For example, entry dates are on the first of each month and an employee�seligibility date is calculated to be January 15. If you select a Prior value (suchas Prior Entry Point), the application adds benefit for the employee with a startdate of January 1. If you select a Next value (such as Next Entry Point), theapplication adds the benefit for the employee with a start date of February 2.

For information on work and pay periods, see the Payroll User Guide.


Procedures in this ChapterIn the Lawson application, entry rules enable you to establish eligibilitycriteria. The procedure below details how to set up Benefit Entry Rules foryour benefit plans.

Defining Entry Rules Tasks to define the waiting period,if applicable, for your employees toenroll in a plan.You can define initialentry and re-entry rules using thesame procedure.

Defining Entry RulesThis procedure defines the entry rules the application uses to determinebenefit eligibility. If a plan�s entry rules change, Lawson recommends that youadd a new entry rule record for the plan. This method lets you define newrules with future dates and provides an audit trail of changes.

You can add a benefit for an eligible employee at any time as long as thebenefit start date equals or is greater than the employee�s eligibility date.This date is determined by the plan�s entry rules.

STOP Before an employee can enroll in a plan with rules based on payperiods or work periods, the employee must be associated with a pay plan onEmployee (HR11.1).


� "What are Benefit Entry Rules?" on page 115

� "How are Entry and Re-entry Rules Defined?" on page 115

� "What are Entry Points?" on page 115


STEPS To define entry rulesTIP You can accessBN16.1 from BN15.1.The button Ent Ruleappears after youinquire on the Company,Plan Type, and Planfields. Once you accessBN16.1, using the EntRule button, the samefields are populated onBN16.1.

1. Access Benefit Entry Rules (BN16.1).

Figure 20. Form clip: Using BN16.1 to define entry rules

2. Select the Company from the Company field.3. Select the Plan Type and Plan from the Plan Type and Plan field.4. Complete the basic benefit entry rule parameters. Consider the following

fields.


Start Date Type the start date you want the entry rules tobecome effective.

You can vary rules by start date. This allows youto define unique rules for different enrollmentperiods. If entry rules change, add a new recordfor the new rules.

Employee Group To define entry rules that are unique to a particulargroup of employees, select the employee groupfor which these entry rules apply.

If you only define one entry that applies to allemployees that are eligible for the plan, leavethis field blank.

If you have multiple records and you leave thisfield blank, the application uses these entry rulesfor employees who do not meet the criteria forspecific employee group entry rules.

IMPORTANT If you define multiple rules basedon an employee group, make certain the groupsare mutually exclusive.

Minimum Age Type the minimum age for entry into the plan.When an employee enrolls in the plan, theemployee�s age on the benefit start date must beequal to or greater than this minimum age.

5. Complete Initial Enrollment parameters. Consider the following fields.

From Date For initial enrollments, select the beginning datean employee is eligible to enroll in the benefit.

If you use the Months, Days, or Hours fields, thedate in this field is the date the waiting periodbegins.

If you leave this field blank, Adjusted Hire Datedefaults.

Pay Class If the initial waiting period for the plan is measuredin hours, select the pay class that defines eligiblehours. The application uses payroll records todetermine the hours an employee has worked.

If you leave this field blank, all hours are includedas eligible hours of service.

If you do not use the Lawson Payroll application,leave this field blank.

Entry Type Select the point at which employees can enrollin the plan.


TIP BN16.5 opensautomatically if youselect prior or next Entrypoint and add the entryrule record.

6. Choose the Init Points button. The Initial Entry Point (BN16.5) opens. De-fine the plan entry point dates.

7. Choose the OK button.8. Complete Re-Enrollment parameters. Consider the following fields.

From Date For re-enrollments, select the date an employeeis eligible to enroll in the benefit. (A re-enrollmentis any time an employee is enrolled in a plantype for which the employee has already had abenefit.)

If you use the Months, Days, or Hours fields, thedate in this field is the date the waiting periodbegins.

If you leave this field blank, Adjusted Hire Datedefaults.

Pay Class If the re-enrollment waiting period for the planis measured in hours, select the pay class thatdefines eligible hours.


If you do not use the Lawson Payroll application,leave this field blank.

Entry Type Select the point at which employees who havemet the re-enrollment waiting period requirementcan enroll in the plan.

CAUTION Using re-enrollment pointsmay limit your ability to change benefitenrollments for employees.

TIP BN16.5 opensautomatically if youselect prior or next Entrypoint and add the entryrule record.

9. Choose the Re-En Points button to define the plan entry point dates.10. Choose the OK button.11. Choose the Add form function.


List waiting periods Benefit Plan Rules Listing (BN216)


Chapter 9

Setup: BN Plan CoverageThis chapter focuses on those procedures that further define your benefitcoverage. In each plan you can define unique coverage for different group ofemployees. You can also define default coverage for a plan. If you definedyour coverage type as No coverage, you do not need to complete theprocedures in this chapter.

STOP If you plan to base coverage on several salary sources, be sureyou have entered the salary information on HR11.

Benefits Administration User Guide Chapter 9 Setup: BN Plan Coverage 121



BNProcesses

MaintainingBN Plans

PlanMaintenance

Flex Plans

Employees

BN PlanEnrollment

BN Company

Preliminaries

Setup

Flex Plan

BN-Plans

BNAutomation

Rules

MaintainEmployee

Enrollments


SavingsBond

Update

Benefit PlanTesting


SpecialProcessing


BN-PlanCoverage



Retirees

You Are Here

BN EntryRules

122 Chapter 9 Setup: BN Plan Coverage Benefits Administration User Guide




� "What are Benefit Salaries?" on page 123

� "What is a Coverage Reduction Table?" on page 124

� "When would I use Coverage Options?" on page 124

� "When would I use Coverage Amounts?" on page 124

What are Benefit Salaries?Benefit salary is the salary amount the Benefits Administration applicationuses to calculate the benefit and the deductions. The benefit plans canuse the following salaries:

� The employee�s salary from his or her record in the Human Resourcesapplication

� One of the five benefit salaries entered on the employee form

� A combination of the employee�s salary and one of the five salaries fromthe employee�s record

� The salary from the employee flex credit form

� A user exit to define a custom formula calculation for the benefit salary, ifnone of the above options is sufficient

ExampleRiver Bend Hospital life insurance coverage is based on commissionemployees earnings from the previous year of employment. The company isusing one of the benefit salary fields to hold the total wages earned from aprior year.

Johnson Shoes includes the employee�s bonuses paid in their coveragecalculation for life and disability plans. The company is using one of thebenefit salary fields to hold the amounts of employee bonuses. This benefitsalary field is then used along with the employee salary from the Pay form tocalculate life or disability coverage.

Example 2You have a disability plan in which coverage is calculated based on theprevious calendar year�s actual earnings. This must to include overtime pay,bonuses, and any other supplemental wages. At the start of each year youpopulate the Benefit Salary 2 field for all your employees with their actual


earning from the previous year. On the disability plan, you select the option ofBenefit Salary 2 as the basis for the coverage calculation.

What is a Coverage Reduction Table?You can indicate how coverage reduces based on age. For example,coverage under an employee life plan:

� Can reduce to 75 percent when an employee reaches 60 years of age

� Can reduce to $10,000 for employees 75 years and older

If you want both a percent and an amount reduction for the same age range,the application uses the greater of the two calculations.

When would I use Coverage Options?In each plan, you define the specific coverage choices that are available. Youcan define unique coverage options for different groups of employees, COBRAparticipants, and retirees. For example, a plan may have three options:single, two-party, and full family coverage. Full time employees and COBRAparticipants can elect any of the three options, part time employees may onlyelect single coverage, and retirees may elect single or two-party coverage.

When would I use Coverage Amounts?A coverage amount is a flat or calculated amount of coverage. For example:

� A life insurance plan offers coverage as a multiple of employee salary, aflat amount, or supplemental

� A disability plan offers coverage as a percent of an employee�s salary

In a benefit plan, you can define unique coverage amounts for differentgroups of employees. For example, the plan could offer union employees lifecoverage as one, two, or three times their salary, while non-union employeescan choose between one to five times their salary in coverage.


Procedures in this ChapterThe following procedures set up the coverage used in benefit plans.

Defining Coverage Options Tasks to define the coverage optionsfor a benefit plan, to indicate whetherdependents are eligible for coverageunder each option.

Defining Coverage Amounts Tasks to define the method fordetermining coverage amounts,limits, and defaults.

Defining Coverage ReductionTable

Tasks to define how coveragereduces as the plan�s participantsget older.

Defining Coverage Limits Tasks to define coverage amountlimits, default coverage amount andreduction amounts.

Defining Coverage OptionsThis procedure allows you to define a plan�s coverage options. You use twoforms: Coverage Options by Plan (BN17.1) and Coverage Option Defaults(BN17.2).

BN17.1 enables you to define all the possible coverage options available forthe plan. You also indicate the number of dependents eligible for coverageunder each option.

BN17.2 enables you to define who is eligible for the coverage option andwhen the options, become active.


� "When would I use Coverage Options?" on page 124

� "What are Benefit Salaries?" on page 123


Figure 21. Procedure flow: Define coverage options

1Access BenefitPlan (BN15.1)

2Select company,

plan type and plan

3Choose Inquire

function

4Choose Coverage

button

5Define coverage

information

6Choose Add form

action

7Define coverageoption defaults

8Choose Add form

action

STEPS To define coverage options1. Access Benefit Plan (BN15.1).2. Select the company, plan type, and plan you want to define coverage op-

tions for.3. Choose Inquire function.4. Choose the Coverage button.The Company, Plan Type and Plan are al-

ready filled in when Coverage Options (BN17.1) opens.


TIP You may accessCoverage Options(BN17.1) directly, thenselect the company,plan type, and plan youwant to define coverageoptions.

Figure 22. Form clip: Using BN17.1 to define coverage options

NOTE You indicate if adependent is disabledon Dependent (HR13.1).

5. Define coverage options. Consider the following fields.

Student andDependents

Type the age at which students or dependentsare no longer eligible for coverage under the plan.The application uses this age to calculate the stopdate for dependent benefits. If a dependent isdefined as not disabled on Dependent (HR13.1),the dependent�s coverage stops the day beforethe dependent reaches this age.

If you leave this field blank, it defaults to 99.

Option Type the coverage option number.

Description Type the coverage option description.

Dep Select either Spouse, Dependents, Spouse andDeps or None to indicate whether spouses,dependents or both can enroll when an employeeelects this option.

NOTE You need to define records on Dependent(HR13.1) as either a spouse or dependent forbenefit enrollment purposes.

Nbr Deps Type the number of dependents including spousethat can enroll when an employee elects thisoption.

If you typed None in the Dep field, do not typeany information in this field.

Status Select the status for this coverage.

If you select Inactive, you cannot select thiscoverage option at benefit entry.

6. Choose the Add function. Coverage Option Defaults (BN17.2) opens auto-matically. You can deactivate an option even if enrollments exist. Existingenrollments are not affected.


7. Define coverage option defaults. Complete the form. Consider the follow-ing fields.

Cover Type Select the plan participants for this coveragerecord.

If the plan covers employees, COBRAparticipants, and retirees, you need at least threeseparate records, for each cover type.

Start Date Type the date this coverage option default recordis effective.

You can vary coverage by start date. This allowsyou to define unique coverage for differentperiods. If coverage changes, add a new recordfor the new coverage.

Employee Group If you define only one coverage option defaultrecord for a particular cover type, leave this fieldblank.

NOTE Employees who do not meet the criteriafor the employee group(s) on the other coveragerecord(s) use this coverage. This is only true ifthere are group-specific records for this plan,cover type, and date, and if you leave this fieldblank.

If you want to define coverage that is uniqueto a particular group of employees, select theemployee group.

If you are defining coverage for COBRAparticipants, leave this field blank.

IMPORTANT If you define coverage by employeegroup, make sure employee groups are definedso that an employee can be a member of onlyone group at a time. If an employee belongs tomore than one group for which coverage optionshave been defined, benefit entry forms andbenefit update reports display an error.


Default Select if you want this option as a default. Youcan only have one default coverage option percoverage option record.

If you define a default option, benefit entry formsenroll eligible employees with the default optionif no option is selected; if benefit update reportsautomatically enroll an employee in the plan, theemployee is enrolled with the default coverageoption.

If you leave this field blank, No defaults andthe benefit update programs list the plan for aneligible employee but not enroll the employee inthe plan.

Status Select the status of this coverage option.

If you select Inactive, you cannot select thiscoverage option for employees for whom thiscoverage option will apply.

TIP This field is where you can deactivateoptions for COBRA participants and retirees.


Defining Coverage AmountsThis procedure outlines those tasks that define the method for determiningcoverage amounts, coverage limits, and coverage defaults.

Calculating Coverage AmountsYou can define coverage amounts four ways: a flat amount of coverage,coverage equal to a multiple of salary, a percent of salary, or supplemental.

� Flat amount All employees get the same amount of coverage. For exam-ple, all employees get $50,000 of coverage, or their spouse and depen-dents each get $2,000 of coverage.

� Multiple of salary Coverage is calculated as a multiple of salary, as thefollowing equation shows:

Annual salary * Multiple of salary = Coverage amount

For example, employees can elect coverage equal to two or three timestheir salary.

The Benefits Administration application uses the parameters definedon the Salary Parameters subform in Coverage Amounts (BN17.3) todetermine the salary used for coverage calculations.

� Supplemental Coverage is elected in specified increments.


For example, if the Increments field is 1000, employees can purchasecoverage in increments of $1,000 within the limits defined for the plan.

� Percent Coverage is calculated as a percent of salary, as shown in theequation below:

Annual salary * Percent = Coverage amount

For example, coverage is 60 percent of salary.

The Benefits Administration application uses the parameters defined onthe Salary Parameters subform BN17.3 to determine the salary usedfor coverage calculations.

� Custom Calculations User defines a custom calculation if the above op-tions do not meet the needed requirements and places the calculation inthe source code. Custom calculations use User Exits functionality. Formore information on User Exits, see the Application Development Work-bench Standards.




Figure 23. Procedure flow: Define coverage amounts

1Access BenefitPlan (BN15.1)

2Select company,

plan type and plan

3Choose Inquire

function

4Choose Coverage

button

5Define covered

participants

6Select calculation

type

7Define coverage

amounts

8Define calcution

type

9Choose Add form

action

- Conditional -See Define Salary

Parametersprocedure

STEPS To define coverage amounts1. Access Benefit Plan (BN15.1).2. Select the company, plan type, and plan you want to define the coverage

amounts.3. Choose the Inquire function.4. Choose the Coverage button. Coverage Amounts (BN17.3) opens and the

company, plan type, and plan fields are filled.


Figure 24. Form clip: Using BN17.3 to define coverage amounts


TIP You may accessCoverage Amounts(BN17.3) directly, thenselect the company,plan type, and plan forwhich you want todefine coverage options.

5. Define the coverage participants and the coverage start date. Consider thefollowing fields.

Cover Type Select the plan participants for this coveragerecord.

If the plan covers employees, COBRAparticipants, and retirees, you need at least threeseparate records, one for each cover type.

Start Date Type the date this coverage amount record iseffective.

You can vary coverage by start date. This allowsyou to define unique coverage for differentperiods. If coverage changes, add a new recordfor the new coverage.

Employee Group If you define only one coverage option defaultrecord for a particular cover type, leave this fieldblank.

NOTE Employees who do not meet the criteriafor the employee group(s) on the other coveragerecord(s) use this coverage. This is only true ifthere are group-specific records for this plan,cover type, and date, and if you leave this fieldblank.

If you want to define coverage that is uniqueto a particular group of employees, select theemployee group.

If you are defining coverage for COBRAparticipants, leave this field blank.

IMPORTANT If you define coverage by employeegroup, make sure employee groups are definedso that an employee can be a member of onlyone group at a time. If an employee belongs tomore than one group for which coverage optionshave been defined, benefit entry forms andbenefit update reports display an error.

6. Select the calculation type that indicates how you want coverage calcu-lated.

If all employees in a group receive the same amount of coverage,select Flat Amount. For example, all employees receive $50,000 of lifeinsurance coverage, and their spouse and dependents each get $2,000of coverage.

If coverage is calculated as a multiple of salary, select Multiple of Salary.For example, employees can elect life insurance coverage equal totwo or three times their salary.


If coverage is calculated as a percent of salary, select Percent. Forexample, disability coverage is 60 percent of salary.

If coverage can be elected in specified increments, select Supplemental.For example, increments of $5,000 of life insurance coverage up to$100,000 maximum.

NOTE You indicate if adependent is disabledon Dependent (HR13.1).

7. Define dependent coverage. Consider the following fields.

Covered Select whether spouse, dependents, or both arecovered by the plan.

If dependents, or both spouse and dependentsare selected, type the age dependents (student ornon-student) are no longer eligible for coverageunder the plan.

Student Age If the plan covers dependents, enter the agestudents are no longer eligible for coverage.If a dependent is defined as a student andnot disabled on Dependent (HR13.1), thedependent�s coverage is automatically stoppedthe day before the dependent reaches this age.

If you leave this field blank, 99 defaults.

Dependent Age If the plan covers dependents, enter the agedependents (who are not students) are nolonger eligible for coverage. If a dependent isnot defined as a student and not disabled onDependent (HR13.1), the dependent�s coverageis automatically stopped the day before thedependent reaches this age.

If you leave this field blank, 99 defaults.

8. Complete the information needed to for calculation. Consider the followingfields.

Flat Amount If the plan�s calculation type is Flat Amount, typethe coverage amount. This amount cannot beoverridden on benefit entry forms.

If the plan covers both spouses and dependents,type the spouse coverage amount in the firstfield and the dependent coverage amount in thesecond field.

Increments If the plan�s calculation type is supplemental,type the increments of coverage that can bepurchased. For example, if employees canpurchase coverage in increments of $5000, type5000.


Multiple If the plan�s calculation type is Multiple (of anemployee�s salary), type the multiple in whichcoverage can be purchased. For example, if youtype 0.5, valid coverage multiples are 0.5, 1.0,1.5, and so on.

Optional: To further define coverage, see"Defining Coverage Salary Parameters" on page135. After you choose the Add function, SalaryParameters (BN02.5) opens.

Percent If the calculation type is Percent (of an employee�ssalary), type the percent of an employee�s salarythat is used to calculate the employee�s coverageamount. For example, if the coverage amountis based on 60 percent of an employee�s salary,type 60.

This amount cannot be overridden on benefitentry forms.

Optional: To further define coverage, see"Defining Coverage Salary Parameters" on page135. After you choose the Add function, SalaryParameters (BN02.5) opens.

9. Choose Add function.

If you defined Calculation type as Percent or Multiple of Salary, theSalary Parameters (BN17.5) form opens, you must define the salaryparameters for these calculation types. See "Defining Coverage SalaryParameters" on page 135.

Options for defining coverage amountsChoose the Limits button if you want to define coverage limits. See "DefiningCoverage Limits" on page 140.

Related Reports and InquiriesTo UseView salary parameters Salary button on Coverage Amounts

(BN17.3)

Defining Coverage Salary ParametersThis procedure outlines the tasks to define coverage salary parameters. Ifyou entered percent or multiple of salary in the Calculation Type on BN17.3,Salary Parameters (BN17.5) automatically opens after you choose Add.You must define the salary parameters to use percent and multiple ofsalary calculations.




Figure 25. Procedure flow: Define coverage salary parameters

1Access Salary

Parameters(BN17.5)

2Select salary type

3Select date

4Complete salary

parameters

5Choose Add form

action

STEPS To define coverage salary parameters1. Access Salary Parameters (BN17.5).

If you defined Calculation type on BN17.3 as Percent or Multiple ofSalary and choose the Add function, Salary Parameters (BN17.5)automatically opens. If BN17.5 did not automatically open, choose theSalary button on BN17.3.

2. Select the salary type you want to use for the calculation in the Type field.The following table explains the different salary options.

Select To use

Employee Salary the employee�s annualized rate ofpay from Employee (HR11.1) or,if applicable, the employee�s stepand grade schedule.

Flex Salary the employee�s salary on theEmployee Flex Credit (BN45.1)record.


Select To use

Benefit Salary the benefit salaries from the BenDate form tab of HR11.1.

Emp and Ben Sal the employee�s annualized rate ofpay from HR11.1 plus a benefitsalary. You use this option ifonly some of your employeesin this plan will need to have abenefit salary amount maintained,such as, employees paid oncommission.

3. Select the date you want to use to determine employee salaries in the Datefield. The table below explains the date options.


Current on the application date employeeenrolls in the benefit.

First of Month on the first of the month the benefitbegins.


Flex Calc Date on the same date used to calculatethe employee�s flex credits.


As of MMDD andYear

Type the date you want to use to determine anemployee�s salary for coverage calculations.� If you selected As of Date in the Date field,




� If you use an AS of Date, and the employeehas no salary history on that date, the currentsalary is used.

Method This is a required field. If you don�t want theapplication to use any rounding methods, selectNo Rounding.


5. Choose OK. BN17.5 closes.6. Choose the Add form function on Coverage Amounts (BN17.3).

If you are changing salary parameters, choose the Change form functionon BN17.3.

Defining Coverage Reduction TableThis procedure outlines the tasks to define the table you use to reducecoverage according to the participants age. If the plan specifies both apercent and an amount reduction, the application uses the greater resultingcoverage of the two.

When you assign a rate table to a benefit plan�s coverage record, the ratetable�s start date must match the start date of the coverage record. For moreinformation see, "Defining Coverage Limits" on page 140.

Calculating Coverage ReductionYou can reduce coverage amounts by a percent, or to a flat amount based onan employee�s age by assigning a coverage reduction table to the benefit plan.

To calculate coverage reduction, the application:

� determines the coverage amount

� multiplies the coverage amount by the Percent field

� compares the result with the Amount field

The reduced coverage amount is the greater amount.


� "What is a Coverage Reduction Table?" on page 124

Figure 26. Procedure flow: Define coverage reduction table

1Access CoverageReduction Table

(BN02.5)

2Select company

3Define coveragereduction table

4Choose Add form

action


STEPS To define coverage reduction table1. Access Coverage Reduction Table (BN02.5).2. Select the Company from the Company field.3. Complete the form. Consider the following fields.

Start Date Type the start date for the rate table.

NOTE Type the code and description thatrepresents the coverage reduction table in theTable field.The same rate table can have manystart dates to accommodate coverage reductionchanges. When you assign a rate table to abenefit plan�s coverage record, the rate table�sstart date must match the start date of thecoverage record. If you add a new rate tablewith a new start date, you must also add a newcoverage record.

Currency Select the currency you want to assign to the ratetable. If you leave this field blank, the companycurrency is the default.

Beg Age Type the starting age for the range. Theapplication calculates the ending age for therange. At least one age range is required and theinitial range should begin with zero to make sureyou include all possible ages.


Percent If you want the coverage amount reduced toa specified percent for plan participants of aparticular age, type the percent of coverage usedfor this age range,

For example, if coverage under an employee lifeplan reduces to 75% of original coverage whenan employee reaches 60 years of age, type 75.

If you also type an amount of coverage for thisage range, the application uses the greater of thetwo calculations.

IMPORTANT If you do not want to reducecoverage at lower ages, type 100% instead ofzero for lower age range.

Amount If the coverage amount is reduced to a specifiedamount for plan participants of a particular age,type the benefit coverage amount used for thisage range.

For example, if coverage under an employee lifeplan reduces to $10,000 for employees 75 yearsand older, type 10000.

If you also type a percent of reduction,the application uses the greater of the twocalculations.

4. Choose the Add function.

Related Reports and InquiriesTo UseList information about the plan. Plan Parameter Listing (BN215)

Defining Coverage LimitsThis procedure outlines the tasks to define coverage amount limits, the defaultcoverage amount and coverage reduction amounts.

You can define the following:

� Limits on the amount of coverage as either flat maximum or minimumamounts, maximum or minimum multiples (for multiple of salary calcula-tions), or based on coverage in another benefit plan

� Coverage reduction rules based on an employee�s age. Coverage maybe reduced by a flat amount, or to a percentage of the original coverageamount


� Default coverage amounts for supplemental and multiple of salary plans.Employees will be enrolled with the default coverage amount if no amountis entered on the benefit entry form when enrollment occurs. If benefitupdate reports automatically enroll employees in the plan, the employeesare enrolled with the default coverage amount.

STOP You must define the coverage amount using Coverage Amountsbefore defining coverage limits. See "Defining Coverage Amounts" onpage 129

STOP If the plan specifies a reduction at different ages, you must define acoverage reduction table. "Defining Coverage Reduction Table" on page 138.

Calculating Coverage Amount LimitsThe Benefits Administration application uses three types of coverage amountlimits. You can combine these limits for each plan.

� Minimum and maximum coverage amount An employee�s coveragecannot be less than the plan�s minimum or greater than the plan�smaximum coverage limits.

For example, employees must elect between $20,000 and $100,000of coverage.

� Minimum and maximum multiple of salary For multiple of salary plans,the multiple an employee elects cannot be less than the minimum or morethan the maximum multiple limit.

For example, employees can elect one to three times their salary.

For other types of coverage, the application calculates the coveragelimit as follows.

Annual salary * Multiple limit = Coverage limit

For example, an employee�s coverage amount cannot be greater thantwo times the employee�s salary.

� Percentage of another benefit For multiple of salary or supplementalplans, you can limit one plan�s coverage to a percentage of another plan�scoverage.

For example, coverage in a spouse life plan cannot exceed 75 percentof the employee�s coverage in another plan.




Figure 27. Procedure flow: Define coverage limits

1Choose Limits

button onCoverageAmounts(BN17.4)

2Complete theamounts limits

3Complete the

multiple of salary

4Complete the limitof another benefit

5Completecoverage

reduction rules

6Complete default

rules

7Choose OK

8Choose Change

form action

STEPS To define coverage limits1. Choose the Limits button on Coverage Amounts (BN17.3).


Figure 28. Form clip: Using BN17.4 to define coverage limits

TIP You cannot formtransfer to BN17.4. Youmust choose the Limitsbutton on BN17.3.

2. Complete the Amount Limits section. Consider the following fields.

Minimum If the plan has a minimum coverage amount, typethe minimum coverage amount.

If the plan is a percent or multiple of salary andthe calculated coverage amount is less than theminimum, the application uses the minimumcoverage for an employee.

If the plan is a supplemental plan and the electedamount is less than the minimum, the applicationdisplays an error message.

Leave this field blank for flat amount plans.

Maximum If the plan has a maximum coverage amount,type the maximum coverage amount.

If the plan is a percent or multiple of salary andthe calculated coverage amount is greater thanthe maximum, the application uses the maximumcoverage amount for an employee.

If the plan is a supplemental plan and theemployee elects more than the maximum, theapplication displays an error message.

Leave this field blank for flat amount plans.

3. Complete the Multiple of Salary Limits section. Consider the followingfields.


Minimum If the plan has a minimum coverage amountdefined as a multiple of salary, type the minimummultiple. For example, if the minimum multipleis 1, type 1.

Maximum If the plan has a maximum coverage amountdefined as a multiple of salary, type the maximummultiple. For example, if the maximum multipleis 5, type 5.

4. Complete the Limit of Another Benefit section. Consider the followingfields.

Percent If coverage in this benefit plan is based on thecoverage of another benefit, type the percent ofcoverage that is allowed. For example, if this isa dependent life plan and an employee�s spousemay elect coverage up to 75 percent of theemployee�s coverage for an employee life plan,type 75.

To add a benefit with this type of limit, theemployee must have a benefit in effect for theplan on which coverage is based.

NOTE When you base a benefit plan on thecoverage of another benefit, the order thebenefits are processed is important. You candefine the benefit process order. See "What isa Benefit Process Order?" on page 48 for moreinformation.

Plan Type, Plan Select the plan type and plan on which thecoverage is based. For example, if coverageunder the plan you are defining is based on anemployee life plan, select EL.

Select the benefit plan on which coverage of theplan you are defining is based. For example,if coverage under the plan you are definingis based on an employee life plan, select theemployee life plan.

5. Complete the Coverage Reduction Rules section. Consider the followingfields.


Rate Table If the plan specifies a reduction of coverage atdifferent ages, select a coverage reduction ratetable.

The rate table you select must have a start dateequal to the start date of this coverage record.

Age Date If the plan specifies a reduction of coverage atdifferent ages, select the date on which ageof the employee or the employee�s spouse isdetermined.

Round Method Select the method of rounding the reducedcoverage amount.

6. Complete the Default Rules section. Consider the following fields.

Default Coverage Select the value that indicates whether there isdefault coverage for the employees covered bythis plan.

If you define default coverage, benefit entryforms enroll eligible employees with the defaultcoverage if no coverage is entered; if benefitupdate reports automatically enroll an employeein the plan, the employee is enrolled with thedefault coverage.

If the plan offers coverage as a flat amount orpercent, the application calculates the defaultcoverage amount. If the plan offers supplementalcoverage or coverage as a multiple of salary,you indicate the default amount or multiple in theSupplemental Amount or Multiple fields.

If you leave this field blank, No defaults. If youdo not define default coverage for this plan, youmust specify the coverage amount for all benefitson the benefit entry programs. The benefit updateprograms will list the plan for an eligible employeebut will not enroll the employee in the plan.

SupplementalAmount

If the Default Coverage field is Yes and the planoffers supplemental coverage, type the defaultcoverage for employees who do not elect acoverage amount.

Multiple If the Default Coverage field is Yes and the plan�scoverage is a multiple of salary, type the multiplethat you want to default if an employee does notchoose a multiple.

7. Choose OK. You return to Coverage Amounts (BN17.3).8. Choose the Change form function on Coverage Amounts (BN17.3).


Chapter 10

Setup: BN Plan ContributionsThis chapter focuses on those procedures that further define your benefitcontributions. There are seven different contribution types. In each plan youcan define unique coverage for different group of employees.

STOP You must have a benefit plan, coverage and deduction codes definedbefore you set up benefit plan contributions. You cannot successfully createplan contributions without the appropriate deductions attached to the plan.

Benefits Administration User Guide Chapter 10 Setup: BN PlanContributions

147



BNProcesses

MaintainingBN Plans

PlanMaintenance

Flex Plans

Employees

BN PlanEnrollment

BN Company

Preliminaries

Setup

Flex Plan

BN-Plans

BNAutomation

Rules

MaintainEmployee

Enrollments


SavingsBond

Update

Benefit PlanTesting


SpecialProcessing


BN-PlanCoverage



Retirees

You Are Here

BN EntryRules

148 Chapter 10 Setup: BN Plan Contributions Benefits Administration User Guide




� "How do I Define Benefit Contributions?" on page 149

� "What are the Differences between the Contribution Types?" onpage 150

� "How are Contributions Calculated?" on page 153

� "When Do I Use Rate Tables?" on page 155

� "How are Company Match Contributions Calculated?" on page155

� "What are Flex Plan Contributions?" on page 156

How do I Define Benefit Contributions?After you define the coverage, using the procedures in Chapter 9, you definethe contribution. The contribution type depends on the value you chose forthe Coverage and how you want to calculate contributions. Contributionscan be flat amount premiums, amounts calculated by the application, oramounts determined by the employee.

The Benefits Administration application stores a benefit plan�s contributionsby date. Each plan can have multiple contribution�s records. When youreceive new contributions, you want to add the contributions using a new startdate. This process provides an online audit trail of changes.

In each plan, you can define unique contributions for different groups ofemployees. For example, contributions for a plan could be $1,000 foremployees in the Midwest and $2,000 for employees on the West Coast.

You can define the following types of contributions.

No contribution For plans where no costs to theemployee or the company is tracked.

Options amount The cost for a coverage option is thesame for all employees in a group.Valid only with a coverage type ofCoverage Options.

Options amount range The cost for a coverage option variesbased on salary, age, or years ofservice ranges for employees in agroup. Valid only with a coveragetype of Coverage Options.


149

Flat contributions The cost for the benefit is notrelated to coverage. You can varycontributions by salary, age, oryears of service. Valid only with acoverage type of Coverage Amountor No Coverage.

Salary or coverage rate table The cost for the benefit is basedon the benefit�s covered salary orcoverage amount. You can varycontributions by salary, age, oryears of service. Valid only with acoverage type of Coverage Amount.

Contribution limits Employees specify contributionswithin defined limits. Valid only witha coverage type of No Coverage.

Match limit schedule Employees specify contributionswithin defined limits that are matchedby the company. Valid only with acoverage type of No Coverage.

Match percent schedule Employees specify contributions thatare matched by the company basedon the percent of the employee�scontribution. Valid only with acoverage type of No Coverage.

Custom calculations A custom defined method ofdetermining contributions.

What are the Differences between the Contribution Types?The table below outlines the major differences between the contribution types.You can also use the table to help decide which types best fit your plan. See"Contribution Type Examples" on page 86 for more information.

ContributionType

Attributes When to Use Example

OptionsAmount

Who is eligible EE, Cobra, Retirees

Calculate as Flat amount,% ofSalary, Flat%, Custom Calculations

Use with Flex plans, define amount

Coverage defined ascoverage options

Cost of coverageoptions is same forall employees in a group

Health plan with adifferent rate for eachoption under the plan.


ContributionType


OptionsAmountRange

Who is eligible:· EE, Cobra,Retirees

Calculate as Flat amount,% of Sal.,Flat%, Custom Calculations


Can use rate tables to varycontributions by Salary, Age, Yearsof service within each of those 3types of rate tables, you can alsodefine different rates depending onwhether the plan participant is asmoker or not.

Coverage defined ascoverage options

Cost of coverageoptions varies basedon salary, age or yearsof service for employeesin a group

An example is a healthplan in which employeeswho earn up to $50,000pay a different ratefor each option thanemployees who earnmore than $50,000.

FlatContributions


Calculate as Flat amount,% ofSal., Flat%, Rate Table, CustomCalculations



Coverage defined ascoverage amount or nocoverage

Cost for the benefit is notbased on the benefit�scoverage amount

A dependent life plan inwhich all employees paythe same amount.

Salary orCoverageRate Table




Coverage defined ascoverage amount

Annual contributionsare based on benefit�scoverage salary orcoverage amount

An employee life plan inwhich rates are basedon each employee�samount of coverage.

ContributionLimits

Who is eligible EE, Cobra

Min and Max limits, Amount eachpay period, Annual amount,% ofSal.


Coverage defined as nocoverage

Employees specifycontributions

A spending accountin which the companylimits an employee�scontribution.

A vacation plan to definethe maximum numberof hours employees canbuy or sell and the costof those hours.


151

ContributionType


Match LimitSchedule

Who is eligible EE

Limit employee pretax, after-taxand total contribution as a percentof salary

Limit the matched contribution by%

Use Years of service to varycontributions


Employees specifypercent or amountcontributions thatare matched by thecompany

The company matches50% of an employee�scontribution up to 4%. Ifan employee contributes3%, the company matchis 1.5% (0.50*3). If theemployee contributes6%, the company matchis 2% (0.50*4).

MatchPercentSchedule

Who is eligible EE

The company match is calculatedas a percentage of the employee�scontribution and can be fixedor cumulative. If the matchcalculation is fixed, the companymatch directly corresponds tothe percent of the employee�scontribution. If the match iscumulative, the company matchincludes all contribution levels upto the level the employee elected.


Employees specifypercent or amountcontributions thatare matched by thecompany

A plan matches·

� 50% of employeecontributions from1% up to 4% and25% of employeecontributions from5% up to 10%.

If the matchcalculation is fixedand an employeecontributes ·

� 3%, the companymatch is 1.50 (0.5 *3).

� 7%, the companymatch is 1.75 (0.25* 7).

If the matchcalculation iscumulative andan employeecontributes

� 3%, the companymatch is 1.5 (0.5 *3).

� 7%, the companymatch is 50% of thefirst 4% and 25%of the next 3%, or2.75% (0.5 * 4 +0.25 * 3).


How are Contributions Calculated?When you define contributions you need to determine how you want thosecontributions calculated. When you use the contribution types optionsamount, options amount range, or flat contributions these can be calculatedas a flat amount, percent of salary, or a flat percent. The following explainseach type of contribution calculation.

Flat amount Every employee in a group pays thesame amount for a coverage option.For example, single coverage costs$300 annually and family coveragecosts $500 annually.

Percent of salary An annual contribution is definedas a percent of the employee�ssalary. You specify the salary for thecalculation on the contribution form.

For example, single coverage is 5percent of salary; family coverage is7 percent of salary. Salary is definedas each employee�s annualized rateof pay from the Human Resourcesapplication.

If an employee�s annual salary is$20,000 and the employee choosessingle coverage, the employee�sannual contribution is $1,000 (0.05 *$20,000). If the employee choosesfamily coverage, the employee�sannual contribution is $1,400 (0.07 *$20,000).

The Benefits Administrationapplication calculates theemployee�s annual contributionat benefit entry. Flat amountdeductions are created for thebenefit.


153

Flat percent A contribution defined as a percentof the employee�s pay period wages.

You define the wages on which thecontribution is based by assigning apay class to the plan�s deductions.The Payroll application calculatesthe actual deduction amount eachpay period. Percent deductions arecreated for the benefit.

Because pay is calculated eachpay period, the wages on whichcontributions are based couldchange each pay cycle. Forexample, an employee�s wageincludes regular and overtimepay. The employee elects singlecoverage, which is 5 percent of pay.On one week, an employee makes$1,000. The employee�s contributionis $50 ($1,000 * 0.05). The nextweek, the employee makes $1,100,which includes $100 in overtime.The employee�s contribution is $55($1,100 * 0.05).

Rate Table A contribution defined using a ratetable where cost varies based onsalary, age, or years of service. Youcan enter rates as an amount orpercent of salary.

For example, in contributions basedon salary, employees making$10,000 to $19,999 pay a differentrate than employees making $20,000to $29,999.

In contributions based on age,employees 20 to 29 years of agepay a different rate than employees30 to 39 years of age.

In contributions based on years ofservice, employees with less thanfive years of service pay a differentrate than employees with more thanfive years of service.


When Do I Use Rate Tables?In the Benefits Administration application you use rate tables to varycontributions by age, salary, or years of service. The rate tables can also varyby smoker status. Rate table contributions are either an amount or a percent.You can use an amount or percent with the Contribution Types; OptionsAmount Range, Flat Contributions, Salary, or Coverage Rate Table.

Only rate tables based on age are valid for COBRA participant and retireecontributions.

The same rate table can have many start dates to accommodate ratechanges. When you assign a rate table to a benefit plan�s contribution record,the rate table�s start date must match the start date of the contribution record.If you add a new rate table with a new start date, you must also add a newcontribution record.

How are Company Match Contributions Calculated?There are two contribution types that allow company match deductions:match limit schedule and match percent schedule. Each contribution typecalculates deductions differently. Each contribution type works differently.

Match Limit ScheduleFor the match limit schedule, the Benefits Administration application createsthe deduction without any special calculations, taking the values directly fromthe schedule. The Payroll application performs calculations that are uniqueto these benefits deductions to determine the amount of the deduction ineach payroll cycle.

For example, the company matches 50 percent of an employee�s contributionup to four percent. If an employee contributes three percent, the companymatch is 1.5 percent (0.50 * 0.03). If an employee contributes six percent, thecompany match is two percent (0.50 * 0.04). You can further define limits tobe based on years of service.You can vary the match limit schedule based onyears of service. If you do not want the match limit schedule varied by yearsof service, define only one range.

Match Percent ScheduleFor the match percent schedule, the Benefits Administration applicationperforms unique calculations to determine the values to be used when thededuction is created. The Payroll application handles the deduction like allother payroll deductions.

For example, a plan matches 50% of employee contributions from onepercent up to four percent and 25% of employee contributions from fivepercent up to ten percent. If the match calculation is fixed and an employeecontributes three percent, the company match is 1.5 (0.5 * 3). If the employeecontributes seven percent, the company match is 1.75 (0.25 * 7). If the matchcalculation is cumulative and an employee contributes three percent, thecompany match is 1.5 (0.5 * 3). If the employee contributes seven percent,


155

the company match is five percent of the first four percent and 25% of thenext three percent, or 2.75% (0.5 * 4 + 0.25 * 3).

For more information, see " Benefit System Logic Calculations" on page 395.

What are Flex Plan Contributions?You have multiple ways of defining contributions for a flex benefit plan thatmay result in negative, zero, or positive employee costs. How you definecontributions depends on how you want to set up the costs of the plan, howyou want the cost of a plan to print on election forms, and how you want coststo appear on employee paychecks.

Below are two ways of defining contributions:

� credits offset by an employee cost

� the net effect of the contribution

Regardless of how you define contributions, the result at benefit entry is thesame. You can define contributions in a similar way on rate tables.

Example of Credits Offset by Employee Cost andNet EffectThe examples illustrate how you can offset flex credits by an employee cost toresult in a negative, zero, or positive employee cost.

� If an employee elects single coverage, he or she receives $1,000 flex cred-its and pays $500, so he or she receives a net $500 flex credits. This ex-ample shows a negative employee cost.

� If an employee elects single + spouse coverage, he or she receives $1,000flex credits and pays $1,000. This examples shows a zero employee cost.

� If an employee elects family coverage, he or she receives $1,000 flex cred-its, and pays $1,500, so he or she pays a net $500. This example showsa positive employee cost.

When you enroll an employee in a plan with a negative contribution, the entryform displays the plan�s pretax contribution as a negative number.


Procedures in this ChapterThe following procedures enable you to setup the contributions you want touse in benefit plans.

Defining Contribution Rate Tables Define the rate tables you want touse for contributions.

Defining Options Amounts Use when coverage is defined ascoverage options and the cost ofcoverage options is the same for allemployees in a group.

Defining Options Amount Range Use when coverage is defined ascoverage options and the cost forcoverage options varies based onsalary, age, or years of service foremployees in a group.

Defining Flat Contributions Use when coverage is defined ascoverage amount or no coverage,and the cost for the benefit is notbased on the benefit�s coverageamount.

Defining Salary or Coverage RateTable

Use when coverage is definedas coverage amount and annualcontributions are based on thebenefit�s covered salary.

Defining Contribution Limits Use when coverage is defined as nocoverage, and employees specifycontributions.

Defining Match Limit Schedule Use when coverage is defined as nocoverage, and employees specifypercent or amount contributions thatare matched by the company.

Defining Match Percent Schedules Use when coverage is defined asno coverage, employees specifypercent or amount contributionsthat are matched by the company.Also if you want to limit theemployee�s pretax, after-tax andtotal contribution as a percentof salary, or you want to limitthe percent of the employee�scontribution that is matched.


157

Defining Contribution Rate TablesYou use rate tables to define contribution amounts based on age, salary,service, and lifestyle credits. The application calculates the contributionsusing either an amount or percent.

When you assign a rate table to a benefit plan�s contribution, the rate table�sstart date must match the start date of the contribution record.

There are four rate table forms you can use to define contributions basedon rate tables. You access these forms from the Access Rate Table Menu(BN02).

If you want to define Then

Age rate table � Select Age Rate Table

� Define the table

� Choose the Add function

Salary rate table � Select Salary Rate Table



Service rate table � Select Service Rate Table



Credit rate table � Select Credit Rate Table



STEPS To define contribution rate tables1. Access Rate Table Menu (BN02).2. If you want to base contributions on age, select Age Rate Table.


Figure 29. Form clip: Using BN02.1 define age rate table

3. Define the age rate table. Consider the following fields.





The same rate table can have many start datesto accommodate rate changes. When you assigna rate table to a contribution record, the ratetable�s start date must match the start date of thecontribution record. If you add a new rate tablewith a new start date, you must also add a newcontribution record.

Amount orPercent

If this rate table is for a contribution recordcalculated as a flat amount, select amount.

If this rate table is for a contribution recordcalculated as a flat percent or percent of salary,select Percent.

Currency Select the currency you want to assign to this ratetable. If you leave this field blank, the companycurrency defaults.

IMPORTANT Any rate table associated with abenefit plan must have the same currency as thebenefit plan.


159

Beg Age Type the starting age for the contributions you aredefining. The application calculates the endingage for the age range. At least one age rangeis required.


Employee Type the plan participant�s contribution.

NOTE A plan participant can be an employee, aretiree, or a COBRA participant.

Contributions for employees can be a negativeamount if the rate table is for a benefit planunder a flex plan. If the employee contribution isnegative, an employee receives flex credits whenhe or she elects the benefit.

If the contribution is positive, the applicationcreates employee deductions. If the contributionis negative, the application creates or updates astandard time record for the employee.

For COBRA participant contributions, include theadministrative fee, if any. The application usesthis field to determine invoice billing amounts forCOBRA participant and retiree contributions.

Company Type the company�s contribution.

For employee benefits, the application usesthis amount to create company deductions. Forretiree benefits, the application uses this amountto create company expense transactions.

This field is not valid for COBRA participantcontributions.

Flex Credits If the rate table is for a benefit plan included in aflex plan in which employees receive flex creditsfor choosing the benefit plan, type the flex creditsan employee receives for choosing the benefit.

If the plan gives flex credits to employees andthere is no employee cost, the applicationcreates or updates a standard time record for theemployee with this amount.

If the plan gives flex credits and there is a costto the employee, the application subtracts theemployee cost from the flex credits.

This field is not valid for COBRA participant andretiree contributions.

4. Choose the Add function.5. If you want to base contributions on salary, select Salary Rate Table.


6. Define the salary rate table. Consider the following fields.






Amount orPercent




IMPORTANT Any rate table associated with abenefit plan must have the same currency as thebenefit plan.

Beg Salary Type the starting salary for the contribution youare defining. The application calculates theending age for the age range. At least one agerange is required.



161













7. Choose the Add function.8. If you want to base contributions on service, select Service Rate Table.e9. Define the service rate table. Consider the following fields.







Amount orPercent




IMPORTANT Any rate table associated with aplan must have the same currency as the plan.

Beg Year Type the lower value of the years of servicerange for the contribution you are defining. Theapplication calculates the ending year of servicefor each range. At least one years of servicerange is required.

NOTE Leave this field blank for the first rangeto begin with zero.


163













10. Choose the Add function11. If you want to base contributions on dependents or lifestyle credits, select

Credits Rate Table.12. Define the credit rate table. Consider the following fields.







Amount orPercent





Beg Nbr Type number of dependents or lifestyle creditsfor this range.

Flex Credits Type the number of flex credits employeesreceive for the number of dependents or lifestylecredits indicated on this detail line.

The lifestyle credits are entered and maintainedon HR11.

13. Choose the Add function

Defining Options AmountYou can use the contribution type of options amount for employee, COBRAparticipant, and retiree contributions. For flex plans, you can define theamount of flex credits the company gives to employees for electing eachbenefit coverage option.


165

The contribution amount can be calculated as a flat amount, percent ofsalary, or a flat percent.

IMPORTANT If the plan does not have unique contributions for specificemployee groups, you only need to define this form once for a plan by leavingthe Employee Group field blank. If the plan has different contributions fordifferent groups of employees, complete this form for each employee groupwith unique contributions. When you define the form for a plan leaving theEmployee Group field blank, the application uses the contribution recordfor employees who do not meet the criteria for a specific employee groupcontribution record.






STEPS To define options amount1. Access Benefit Plan (BN15.1).2. Select the company, plan type, and plan for which you want to define op-

tions amount.3. Choose Inquire function.4. Choose the Contrib button. The Company, Plan type and Plan are already

filled in when Options Amount (BN18.1) opens.

Figure 30. Form clip: Using BN18.1 to define options amount

5. Select the plan participants for the contribution record from the Cover Typefield.

6. Type the start date for the contribution.


7. If you are defining contributions that are unique to a particular group ofemployees, select the employee group for which this contribution applies.

NOTE If you leavethis field blank, theapplication uses thiscontribution record foremployees who do notmeet the criteria for aspecific employee groupcontribution record.

If you are defining contributions for COBRA participants, leave thisfield blank.

IMPORTANT If you define contributions by employee group, make sureemployee groups are defined so that an employee can be a member of onlyone group at a time. If an employee belongs to more than one group forwhich contributions have been defined, benefit entry programs and benefitupdate reports show an error.

8. Define calculation attributes for this contribution. Consider the followingfields.


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Calculation Type Select the method in which the contribution iscalculated.

If every employee in a group pays the sameamount for a coverage option, select Flat Amount.

If you are defining contributions for COBRAparticipants and retirees, select Flat Amount.

If the annual contribution is a percent of theemployee�s annual salary, select Percent ofSalary.

If the contribution is a percent of the employee�spay period wages, select Flat Percent.

IMPORTANT The calculation type selectedmust match the calculation type defined on thededuction codes that are attached to the plan.

Contribution TaxType

Select whether the employee contributions arepretax, after-tax or both.

If the plan does not allow for employeecontributions, select No Employee Contribution.

If you are defining contributions for COBRAparticipants and retirees, select After-Tax.

IMPORTANT This field must match with thedeductions attached to the plan.

Default Tax Type If employees can choose between pretax andafter-tax contributions and you want a tax typeto default on benefit entry forms, select thecontribution tax type that you want as the default.You can override the default contribution tax typeon benefit entry forms.

If you selected Pretax or After-Tax in the ContribTax Type field and you leave this field blank, thisfield defaults to the value in the Contrib Tax Typefield.

9. If calculation type is percent of salary, select the salary type you want touse for the options amount calculation in the Type field. The following tableexplains the different salary options.


Select To use

Employee Salary the employee�s annualized rate ofpay from Employee (HR11.1) or,if applicable, the employee�s stepand grade schedule.

Benefit Salary the benefit salaries from theBenefit form tab of HR11.1.

Flex Salary the employee�s salary fromEmployee Flex Credits (BN45.1).

Emp and Ben Sal the employee�s annualized rate ofpay from HR11.1 plus a benefitsalary. You use this option ifonly some of your employeesin this plan will need to have abenefit salary amount maintained.For example, commissionedemployees.

10. If you selected a salary type, select the date you want to use to determineemployee salaries in the Date field. The table below explains the dateoptions.


Current on the date the benefit begins.

First of Month on the first of the month in whichbenefit begins.




169

As of MMDD andYear

Type the date you want to use to determine anemployee�s salary.� If you selected As of Date in the Date field,





Minimum andMaximum

Type the minimum and maximum salary amountsfor calculating contributions. If an employee�ssalary is either less or greater than theseamounts, the application uses these amounts tocalculate flex credits for the employee.


12. Choose the Options button. The Options Rates (BN19.1) form opens. De-fine the annual employee, Cobra, retiree, and company contribution for theplan. The coverage options you defined for the plan on Coverage Options(BN17.1) display on the form.

TIP Choosing the addfunction on OptionsAmount (BN18.1)automatically opensOptions Rates (BN19.1)just like choosing theOptions button.


Related Reports and InquiriesTo UseList benefit plan information Plan Parameter Listing (BN215)

Defining Options Amount RangeThis procedure outlines tasks that enable you to set up contributions. Usethis procedure to define contributions for plans in which contributionsare associated with coverage options and are based on salary, age, oryears-of-service ranges. Each coverage option is associated with a differentrate table which contains the rates for the option. Any amounts on this formuse the currency associated with the plan on Benefit Plan (BN15.1).


IMPORTANT If the plan does not have unique contributions for specificemployee groups, you only need to define this form once for a plan by leavingthe Employee Group field blank. If the plan has different contributions fordifferent groups of employees, complete this form for each employee groupwith unique contributions. If you define multiple contribution records forone plan, you may choose to leave the employee group field blank on oneof the records. The application applies the record with no employee groupto all eligible employees who do not belong to the group(s) attached tothe other record(s).






STEPS To define options amount range1. Access Benefit Plan (BN15.1).2. Select the company, plan type, and plan for which you want to define op-

tions amount range.3. Choose Inquire function.4. Choose the Contrib button. The Company, Plan type and Plan are already

filled in once Options Amount Range (BN18.2) opens.

Figure 31. Form clip: Using BN18.2 to define options amount range


6. Type the start date for the contribution.7. If you are defining contributions that are unique to a particular group of

employees, select the employee group for which this contributions applies.


171

NOTE If you choose toleave the group fieldblank, the applicationapplies the record withno employee group toall eligible employeeswho do not belong tothe group(s) attached tothe other record(s).


IMPORTANT If you define contributions by employee group, make sureemployee groups are defined so that an employee can be a member of onlyone group at a time. If an employee belongs to more than one group forwhich contributions have been defined, benefit entry programs and benefitupdate reports show an error.


Calculation Type Select the method the contribution is calculated.




If the contribution is a percent of the employee�spay period wages, select Flat Percent



Select whether the employee contributions arepretax, after-tax or both pretax and after-tax.



IMPORTANT This must match with thedeductions attached to the plan.




Rate Table Type If you want to use a rate table to calculatecontributions, select the rate table.

TIP If you add onBN18.2 and a rate tableis attached BN18.8opens automatically.

9. If you selected a rate table, choose the Criteria button. The Salary AgeService (BN18.8) form opens. Define how you want the application to de-termine an employee�s salary, age, and years of service. Fill in the appro-priate fields for the rate table you selected on the Options Amount Range(BN18.2).

10. Choose Ok. The application returns you to the Options Amount Rangeform.

11. Choose the Options button. The Options Rates Table (BN19.2) formopens. Select those rate tables you want associated with the coverageoptions. The coverage options you defined for the plan on CoverageOptions (BN17.1) display on the form.

12. Choose the Add function. The BN19.2 closes and returns you to BN18.2.13. Choose the Add function.


Defining Flat ContributionsThis procedure enables you to define contributions for plans in which everyemployee in a group pays the same flat amount, flat percent, or percent ofsalary. Use this procedure only for plans with either coverage amounts orno coverage.


173

IMPORTANT If the plan does not have unique contributions for specificemployee groups, you only need to define this form once for a plan by leavingthe Employee Group field blank. If the plan has different contributions fordifferent groups of employees, complete this form for each employee groupfor with unique contributions. If you define multiple contribution records forone plan, you may choose to leave the employee group field blank on oneof the records. The application applies the record with no employee groupto all eligible employees who do not belong to the group(s) attached tothe other record(s).






STEPS To define flat contributions1. Access Benefit Plan (BN15.1).2. Select the company, plan type and plan for which you want to define flat

contributions.3. Choose Inquire function.4. Choose the Contrib button. The Company, Plan type and Plan are already

filled in when Flat Contributions (BN18.3) opens.

Figure 32. Form clip: Using BN18.3 to define flat contributions



employees, select the employee group for which this contributions applies.




IMPORTANT If you define contributions by employee group, make sureemployee groups are defined such that an employee can be a member ofonly one group at a time. If an employee belongs to more than one group forwhich contributions have been defined, benefit entry programs and benefitupdate reports show the situation as an error.



175

Calculation Type Select the method the contribution is calculated.




If the contribution is a percent of the employee�spay period wages, select Flat Percent.











Employee If the plan participant contributes to the plan andthe calculation type is not Rate Table, type theannual participant contribution.

For COBRA participant contributions, includethe administrative fee, if any. The applicationuses this amount to create either deductionsfor employees or the billing amount for COBRAparticipants and retirees.

If this is a flex benefit plan, the employeecontribution can be a negative amount. If theemployee contribution is negative, employeesreceive flex credits when they elect this benefit.

NOTE If the contribution is positive, theapplication creates employee deductions. If thecontribution is negative, the application creates orupdates a standard time record for the employee.

Flex Credits For flex plans, type the annual amount of flexcredits the company gives to employees whoelect this benefit.

10. If the calculation type is not Rate Table, type the company�s annual contri-bution in the Company field.

11. If the Calculation Type field is Rate Table, select the rate table that youwant used to calculate contributions for plan participants affected by thiscontribution record. For COBRA participant or retiree contributions, selectan age rate table.

TIP If you add onBN18.2 and a rate tableis attached, BN18.8opens automatically.

12. If you selected a rate table, choose the Criteria button. The Salary AgeService (BN18.8) opens. Define how you want the application to determinean employee�s salary, age, and years of service. Fill in the appropriatefields for the rate table you selected on the BN18.3.

13. Choose Ok. The application returns you to the Options Amount Range.14. Choose the Add function.


Defining Salary or Coverage Rate TableThis procedure enables you to have the application calculate flat annualcontributions based on the participant�s annual salary or coverage amount.You can vary contributions by age, salary, or years-of-service. Any amountsused in this procedure use the currency associated with the plan you definedon Benefit Plan (BN15.1).


177

IMPORTANT If the plan does not have unique contributions for specificemployee groups, you only need to define this form once for a plan by leavingthe Employee Group field blank. If the plan has different contributions fordifferent groups of employees, complete this form for each employee groupwith unique contributions. If you define multiple contribution records forone plan, you may choose to leave the employee group field blank on oneof the records. The application applies the record with no employee groupto all eligible employees who do not belong to the group(s) attached tothe other record(s).







STEPS To define salary or coverage rate table1. Access Benefit Plan (BN15.1).2. Select the company, plan type and plan for which you want to define salary

or coverage rate table.3. Choose Inquire function.4. Choose the Contrib button. The Company, Plan type, and Plan are already

filled in when Salary or Coverage Rate Table (BN18.4) opens.

Figure 33. Form clip: Using BN18.4 to define salary or coverage rate table




7. If you are defining contributions that are unique to a particular group ofemployees, select the employee group for which this contributions applies.




8. Define the contribution attributes for this contribution. Consider the follow-ing fields.










179

Rate Table Select the age, salary or years of service ratetable you want to use to calculate contributions.For COBRA participant or retiree contributions,select an age rate table.

NOTE The rate table you select must have a startdate equal to the start date of this contributionrecord.

Coverage orSalary

Select whether contributions are calculated usingcovered salary or the coverage amount definedfor the benefit.

NOTE COBRA participant and retireecontributions must be based on coverage.

Cost Per If contributions are calculated based onincrements of salary or coverage, type theincrement used to determine the contribution.(For example, contributions are $1.00 for each$1,000 of coverage.)

Leave this field blank if the contribution is a flatannual amount or a flat percent.

10. Choose the Criteria button. The Salary Age Service (BN18.8) form opens.Define how you want the application to determine an employee�s salary,age, and years of service. Fill in the appropriate fields for the rate tableyou selected on the Salary or Coverage Rate Table.

11. Choose Ok. The application returns you to the Salary or Coverage RateTable.

12. Choose the Add function


Defining Contribution LimitsThis procedure enables you to define contribution limits and companycontributions for a plan in which employees elect contributions levels withinlimits. The typical plan is a spending account where the company limits theamount an employee can contribute. You also use this procedure for vacationplans to define the maximum number of hours employees can buy or selland the cost of those hours.


IMPORTANT If the plan does not have unique contributions for specificemployee groups, you only need to define this form once for a plan by leavingthe Employee Group field blank. If you define multiple contribution records forone plan, you may choose to leave the employee group field blank on oneof the records. The application applies the record with no employee groupto all eligible employees who do not belong to the group(s) attached tothe other record(s).

To base a percent contribution on specific kinds of pay rather than all pay,assign a pay class to the deduction when you define the deduction inDeduction (PR05.1).






STEPS To define contribution limits1. Access Benefit Plan (BN15.1).2. Select the company, plan type and plan for which you want to define con-

tribution limits.3. Choose Inquire function.4. Choose the Contrib button. The Company, Plan type, and Plan are already

filled in once Contribution Limits (BN18.5) opens.

Figure 34. Form clip: Using BN18.5 to define contribution limits




181

7. If you are defining contributions that are unique to a particular group ofemployees, select the employee group for which this contributions applies.




8. Define the contribution attributes for this contribution. Consider the follow-ing fields.


Contribution Type Select whether employees can contribute as apercent, an amount, or either a percent or anamount.

If the plan does not allow employee contributions,select No Employee Contrib.

If you are defining contributions for COBRAparticipants, select Amount.









9. If the plan specifies a minimum contribution for employees or COBRA par-ticipants, complete the Minimum Contributions section. Consider the fol-lowing fields.


183

Pay Period Type the minimum pay period amount.

Annual Type the maximum annual amount.

Percent Type the minimum percent contribution.

You can use the minimum percent limit foremployee percent or amount contributions. If theemployee contributes an amount, the applicationcalculates the percent based on the salaryspecified in the Salary subform to test minimumand maximum percents.

NOTE This field is not valid for COBRAparticipant contributions.

10. If the plan specifies a maximum contribution for employees or COBRA par-ticipants, complete the Maximum Contributions section. Consider the fol-lowing fields.

Pay Period Type the maximum pay period amount.

Annual Type the maximum annual amount.

Percent Type the maximum percent contribution.

You can use the minimum percent limit foremployee percent or amount contributions. If theemployee contributes an amount, the applicationcalculates the percent based on the salaryspecified in the Salary subform to test minimumand maximum percents.


11. If the company contributes a flat amount for this benefit, complete the Com-pany Contribution section. Consider the following fields.


Amount If the company contributes a flat amount for thisbenefit, type the amount.

If employees make only percent contributions forthis benefit, leave this field blank. If the companycontributes a percent, leave this field blank.

This contribution creates a flat amount deduction.


Percent If the company contributes a percent, typethe percent. If you type a percent companycontribution, leave the Amount field blank.

If employees make only amount contributions forthis benefit, leave this field blank. If the companycontributes an amount, leave this field blank.

This contribution creates a percent deduction;when you define the deduction, you can indicatethe type of pay on which the deduction is based.


12. If you are defining a flex vacation plan, complete the Vacation section. Con-sider the following fields.

Maximum hours Type the maximum number of vacation hours anemployee can buy or sell each flex year.

Cost To calculate the cost of buying or selling vacationhours for a flex vacation plan, type the percent bywhich employee hourly rates are multiplied.

For example, if employees can purchase vacationhours for the same rate as they are paid, type100. If employees can sell vacation at half theirhourly rate of pay, type 50.

13. If employees can contribute an amount and there are percent contributionlimits, choose the Salary button. The Salary (BN18.9) form opens. Definehow you want the application to determine employee salaries for contribu-tion calculations.




185

Defining Match Limit SchedulesThis procedure enables you to define contribution limits for a plan in whichemployees contribute a percent or an amount that the company matches. Youcan limit the employee�s pre-tax, after-tax, and total employee contributionas a percent of salary. The company match is calculated as a percentageof the employee�s contribution. You can limit the percent of the employee�scontribution that is matched. You can vary the match limit schedule based onyears of service. If you do not want the match limit schedule varied by yearsof service, define only one range.

IMPORTANT If the plan does not have unique contributions for specificemployee groups, you only need to define this form once for a plan by leavingthe Employee Group field blank. If the plan has different contributions fordifferent groups of employees, complete this form for each employee groupfor which contributions are unique. If you define multiple contribution recordsfor one plan, you may choose to leave the employee group field blank on oneof the records. The application applies the record with no employee groupto all eligible employees who do not belong to the group(s) attached tothe other record(s).







STEPS To define match limits schedules1. Access Benefit Plan (BN15.1).2. Select the company, plan type and plan for which you want to define a

match limit schedule.3. Choose Inquire function.4. Choose the Contrib button. The Company, Plan type, and Plan are already

filled in once Match Limits Schedules (BN18.6) opens.


Figure 35. Form clip: Using BN18.6 to define match limits schedules



employees, select the employee group for which this contribution applies.NOTE If you choose toleave the group fieldblank, the applicationapplies the record withno employee group toall eligible employeeswho do not belong tothe group(s) attached tothe other record(s).



8. Define the Calculations section for this contribution. Consider the followingfields.


187


If the plan does not allow employee contributions,select No Employee Contrib.

If you are defining contributions for COBRAparticipants, select Amount.









Increments Type the percent increment employees cancontribute to the plan. For example, if you typeone, employees can make contributions of onepercent, two percent, three percent and so on,within the other limits of the schedule. If you type0.5, employees can make contributions of 0.5%,one percent, 1.5% and so on.

Match Option Select if you want your company to matchcontributions as pretax, after-tax or both.


From Date Select the date from which you want theapplication to begin calculating each employee�syears of service. If your schedule does not varybased on years of service, select Hire Date orAdjusted Hire Date.

The values of this field are from Employee(HR11.1).

Service Date Select the date you want the application todetermine each employee�s years of service.

As of MMDD andYear

Type the date you want to use to determinean employee�s years of service for coveragecalculations.� If you selected As of Date in the Date field,


use the As of Date, the application calculatesan employee�s years of service on the latestmonth and day specified.

� If you type a Year, the employee�s years ofservice are determined on the exact month,day, and year you specify.

9. If the Contribution Type is Amount, define the salary section for this contri-bution. Consider the following fields.

Type Select the type of salary you want to use for thecontribution calculation. Leave this field blank ifthe contribution type is percent.

Date Select the date you want the application tocalculate each employee�s salary.

As MMDD andYear

Type the date you want to use to determine anemployee�s salary for contribution calculations.� If you selected As of Date in the Date field,






189

Minimum andMaximum

Type the minimum and maximum salary amountsfor calculating contributions. If an employee�ssalary is either less or greater than theseamounts, the application uses these amounts tocalculate the contribution for the employee.


10. Choose the Schedule button. The Match Limits (BN19.3) form opens. De-fine the employee, company, and company match contributions with limitsbased on a service schedule.



Defining Match Percent SchedulesThis procedure enables you to define contributions for a plan whereemployees contribute a percent or an amount that your company matches.The company match is calculated as a percentage of the employee�scontribution and can be fixed or cumulative. If the match calculation is fixed,the company match directly corresponds to the percent of the employee�scontribution. If the match is cumulative, the company match varies byincremental percents. The company match varies as the employee�scontribution percent increases.

IMPORTANT If the plan does not have unique contributions for specificemployee groups, you only need to define this form once for a plan by leavingthe Employee Group field blank. If the plan has different contributions fordifferent groups of employees, complete this form for each employee groupfor which contributions are unique. If you define multiple contribution recordsfor one plan, you may choose to leave the employee group field blank on oneof the records. The application applies the record with no employee groupto all eligible employees who do not belong to the group(s) attached tothe other record(s).








STEPS To define match percent schedules1. Access Benefit Plan (BN15.1).2. Select the company, plan type and plan for which you want to define a

match percent schedule.3. Choose Inquire function.4. Choose the Contrib button. The Company, Plan type, and Plan are already

filled in once Match Percent Schedules (BN18.7) opens.

Figure 36. Form clip: Using BN18.7 to define match percent schedules




191


7. If you are defining contributions that are unique to a particular group ofemployees, select the employee group for which this contribution applies.



8. Define the Calculations section for this contribution. Consider the followingfields.









Increments Type the percent increment employees cancontribute to the plan. For example, if you typeone, employees can make contributions of onepercent, two percent, three percent and so on,within the other limits of the schedule. If you type0.5, employees can make contributions of 0.5%,one percent, 1.5% and so on.

Match Option Select if you want your company to matchcontributions as pretax, after-tax or both pretaxand after-tax.

IMPORTANT This field must match with thedeductions attached to the plan.

Emp Max Percent Type the maximum total percent employees cancontribute to the plan with pretax and after-taxcontributions.

Match Calc Select either Fixed or Culumative to define howyour company�s match is calculated.

If the company matches only the contributionlevel the employee elected, select Fixed.

If the company match includes all contributionlevels up to the level the employee elected, selectCumulative.

9. If the Conribution Type is Amount, complete the salary section for this con-tribution. Consider the following fields.

Type Select the type of salary you want to use for thecontribution calculation. Leave this field blank ifthe contribution type is percent.

Date Select the date you want the application tocalculate each employee�s salary.


193

As MMDD andYear

Type the date you want to use to determine anemployee�s salary for contribution calculations.� If you selected As of Date in the Date field,





Minimum andMaximum

Type the minimum and maximum salary amountsfor calculating contributions. If an employee�ssalary is either less or greater than theseamounts, the application uses these amounts tocalculate flex credits for the employee.


10. Choose the Schedule button. The Match Percent Schedule (BN19.4)opens. Define the employee, company, and company match contributionswith limits based on a service schedule

11. Choose the Add function. The application returns you to BN19.4.



Chapter 11

Setup: Automation RulesBenefit automation rules enable you to automate Benefit processing. Thischapter focuses on those procedures that define the add, change andtermination automation rules.

STOP Before you can use automation rules, personnel actions must exist.

See the Personnel Administration User Guide for information on personnelactions. See the Human Resources User Guide for information on employeegroups.

Benefits Administration User Guide Chapter 11 Setup: Automation Rules 195



BNProcesses

MaintainingBN Plans

PlanMaintenance

Flex Plans

Employees

BN PlanEnrollment

BN Company

Preliminaries

Setup

Flex Plan

BN-Plans

BNAutomation

Rules

MaintainEmployee

Enrollments


SavingsBond

Update

Benefit PlanTesting


SpecialProcessing


BN-PlanCoverage



Retirees

You Are Here

BN EntryRules

196 Chapter 11 Setup: Automation Rules Benefits Administration User Guide




� "What are Benefit Automation Rules?" on page 197

� "When Do I Use Add Rules?" on page 197

� "When Do I Use Change Rules?" on page 198

� "When Do I Use Termination Rules?" on page 199

� "How Do I Use Employee Groups with Automation Rules?" onpage 200

What are Benefit Automation Rules?The Benefits Administration application automates benefit processing bystopping, changing, and adding benefits and flex credits based on employeechanges made by personnel actions. You define automation rules thatidentify the personnel actions, including changes that impact benefits andthe plans for which employee benefits are updated. In addition, you definewhen these rules will take effect. There are three automation rules: Add,Change and Termination.

Add rules determine the waiting period for employees who, as a result of apersonnel action, become eligible to enroll in a benefit or a flex plan. Changerules determine the date used to update benefits for employees whosebenefits change due to a personnel action. Termination rules determinethe stop date for employees whose benefits should stop as a result ofa personnel action.

You can define rules for a flex plan, plan type, or a benefit plan. Using therules defined for a flex plan, when an employee becomes ineligible due toa personnel action, the employee�s flex credit record is stopped along withall the employee�s benefits under the flex plan.

When Do I Use Add Rules?You define add rules for personnel actions that cause an employee to becomeeligible for a benefit plan. An employee becomes eligible for a plan if:

� The employee is added to an employee group used to qualify an employeefor the plan

� The employee�s benefit postal code changes to match one in the plan�spostal code table


Add rules are useful when you want specific entry rules for situations otherthan an employee�s initial enrollment. For example:

� Hire Actions for New Employees: If you update benefits, you need to havean add rule for the new hire.

� Re-hires: A waiting period you apply to new hires can be reduced orwaived for employees being rehired. You can define an add rule that isused with a �Rehire� personnel action to establish rules separate from theplans main Entry rules.

� Return from Leave: If benefits are stopped when an employee goes oncertain type of unpaid leave (other than medical leave), they may need tobe re-added when the employee returns to active employment status. Addrules can be used to automatically reinstate the enrollment if a personnelaction is used to change the employee�s status upon their return.

� Different Plans for Different Groups: If you have separate plans for dif-ferent groups of employees (Executive vs. Regular staff; Union vs. Non-Union), an add rule may be used to add the new benefit when an employeemoves between the groups, an example is a promotion to an executive po-sition that qualifies an employee for a plan open only to executives.

ExampleMaxco Oil Corporation has different rules for all health coverage onemployees that are rehired within a year of termination and employees thatare rehired after a year. Employees who are re-hired within a year have nowaiting period and can have coverage as of the first of the next month aftertheir adjusted hire date. Employees rehired after a year can have coveragethe first of the month after waiting 60 days from their adjusted hired date.

Maxco Oil does employee maintenance through personnel actions. They havedefined two different rehire personnel actions. One called REHIRE-YR for lessthan a year and one called REHIRE for greater than a year. Each personnelaction is associated with an add rule defining the appropriate waiting period.

When Do I Use Change Rules?You define change rules for personnel actions that affect an employee�scurrent benefits. An employee�s current benefits are affected by the followingchanges:

� The employee�s membership in an employee group changes, making himor her eligible for different coverage, contributions or general ledger over-rides

� The employee�s salary changes. Salary changes include changes madeto the employee�s job code, FTE (Full-Time Equivalent), rate of pay, step,grade, schedule, salary class, or benefit salaries

� The employee�s pay frequency changes


Example 1The Perox Oil Company�s health plan HL1 has different contribution amountsfor salaried and hourly employees. Perox Oil maintains employee informationthrough personnel actions. Only a JOBCHG personnel action can changethe employee from hourly to salaried. The benefit change date and thepersonnel action date should be the same date. A change rule is defined forthe JOBCHG action and the HL1 benefit plan using the personnel action dateas the effective date for benefits automatically updated.

Example 2The Perox Oil Company offers only two employee Life plans, both are amultiple of salary plan. The employee�s coverage amount increases when anemployee receives an increase in pay. Both a PROMOTION and SALINCpersonnel action can increase the employee�s pay. The Benefit changeshould be effective the following pay period. Two change rules are defined,one for each action, identifying the next pay period as the effective dateused for benefit changes.

When Do I Use Termination Rules?You define termination rules only for personnel actions that cause anemployee to be ineligible for a benefit. An employee is no longer eligible fora plan if:

� The employee is removed from an employee group used to qualify an em-ployee for the plan.

� The employee�s postal code changes so that it no longer matches one inthe postal code table for the plan.

ExampleAll full-time employees are eligible for all health plans at Sampson LumberCompany. When an employee is terminated, the date the employee�s healthbenefit terminates depends on whether an employee belongs to the union.Union employees are covered for 60 days after termination and all otheremployees are covered for 30 days. All employees should have COBRAparticipant records created for the COBRA occurrence type that representstermination in the application.

Sampson Lumber must establish two different termination rules, for thedifferences in the benefit stop dates to be created. One rule will use anemployee group for union employees and the other rule will leave theemployee group field blank to include the non-union employees. Whenan employee group is used on a rule, the eligible employee group on thehealth plan needs to contain the union employee group as part of theselection criteria.


What is a Nested Employee Group?Nested groups are employee groups that use other employee groups as partof their definition. For example, your company has two unions. Depending onwhich union the employee belongs to, certain benefit options could vary. Toaddress those differences you create an employee group for each union.Then you define an overall group to include the two groups. These twogroups become �nested� in the overall group. The diagram below illustratesthe example.

Group Cconsists of the full timeemployees

Those employees aredrawn from Group A andGroup B

Group A consists of thefull time employees fromUnion X

Group B consists of thefull time employees fromUnion Z

How Do I Use Employee Groups with Automation Rules?You can use employee groups for Add or Termination rules. If the rules aredifferent based on employee groups, attach a specific group to the rules youdefine. Groups attached to automation rules for a given plan must be mutuallyexclusive, so that no employee is a member of more than one group and onlyone rule applies to any given employee.

ExampleYour company has a health plan that covers all full-time union employees.The company has two unions, Union A and Union B. When a terminationoccurs, coverage in the plan ends at the end of the month for employees inUnion A, but extends for 45 days beyond the termination date for employeesin Union B. Two separate termination rules are defined, each with anemployee group attached (Group A and Group B). The group of all full-timeunion employees (Group C) which is used to define eligibility on the benefitplan, must be defined with criteria that identifies Group A and Group B.


IMPORTANT For the Benefits Administration application update programto process the rules correctly, the employee group you identified when youdefined eligibility for a plan must use a nested group approach for the groupcriteria. When you use group-specific automation rules, the groups attachedto the rules must literally make up the criteria for the group used as theplan�s main eligible group.


Procedures in this ChapterThe procedures in this chapter provide instructions to define automationrules for your benefit plans.

Defining Add Rules Tasks to define a waiting period foremployees who, as a result of apersonnel action, become eligible toenroll in a benefit or flex plans.

Defining Change Rules Tasks to define the data used toupdate benefits for employeeswhose benefits change due to apersonnel action.

Defining Termination Rules Tasks to define a benefit stop date foremployees whose benefits shouldstop as a result of a personnelaction.

Defining Add RulesAdd rules determine the eligibility date for employees who, as a result of achange made by a personnel action, become eligible for a flex plan or benefitplan.

The Add rules are used by Employee Change Benefit Update (BN100)to calculate each employee�s eligibility date and, if appropriate, to enrollan employee in a plan or flex plan. BN100 enrolls an employee in defaultbenefit plans only.

If a change makes an employee eligible for a plan for which add rules existbut the plan is not a default plan, the employee�s new eligibility date iscalculated and listed on the report, but the employee is not enrolled. If no addrule exists, BN100 lists the employees without a new eligibility date.

IMPORTANT Add rules do not enroll employees into benefit plans unlesssome benefit history exists. If the employee has become eligible for benefitsfor the first time, use Mass Benefit Add (BN101) to enroll the employeeinto default plans.



� "When Do I Use Add Rules?" on page 197



Figure 37. Procedure flow: Define Add Rules

1Access Add Rules

(BN16.2)

2Select company,

plan type

3Select the plan

4Type add ruleseffective date

5- Optional -

Select employeegroup

6Select personnel

action

7Define eligibility

rules

8- Optional -

Define entry points

9Choose OK

STEPS To define add rules1. Access Add Rules (BN16.2).


Figure 38. Form clip: Using BN16.2 to define add rules

2. Select the company and the plan type from the Company and Plan Typefields.

3. Select the plan for which you want to define add rules. If you leave thisfield blank the rule will apply to all plans within the plan type selected.

4. Type the date the add rules are effective. You can vary rules by start date.This allows you to define unique rules for different periods. If rules change,add a new record for the new rules.

5. If you are defining add rules that are unique to a particular group of em-ployees, select the employee group for which these add rules apply.

IMPORTANT If you define add rules by employee group, make sureemployee groups are defined such that an employee can be a member of onlyone group at a time. If an employee belongs to more than one group for whichrules have been defined, benefit update reports list the situation as an error.

6. Select the personnel action that triggers an employee�s eligibility for theplan.

7. Define the eligibility rules. Consider the following fields.

From Date Select the date the waiting period begins.

Months, Days andHours

Type the number of months, days or hours anemployee must work before becoming eligible toenroll in the plan.

To calculate the employee�s eligibility date, theapplication adds these numbers to the date inthe From Date field.


Pay Class If the waiting period is measured in hours, selectthe pay class that defines eligible hours.


Entry Type Select the date you want benefit update programsto use, to enroll eligible employees.

For example, entry dates are on the first ofeach month and an employee�s eligibility date iscalculated to be January 15. If you select a Prior(such as Prior Entry Point), the application addsthe benefit for the employee with a start date ofJanuary 1. If you select a Next (such as NextEntry Point), the application adds the benefit forthe employee with a start date of February 2.

NOTE If you do not use the Lawson Payrollapplication, values including pay periods or workperiods are not valid.

See the Payroll User Guide for information aboutpay and work periods.

TIP If you select prioror next entry point asthe entry type andchoose the Add formfunction, Plan EntryPoints (BN16.5) opens.

8. If you select prior or next entry points for Entry Type, choose the Pointsbutton. The Plan Entry Points (BN16.5) form opens. Define the dates onwhich employees can enroll in the plan.

9. Choose OK button. The application returns you to Add Rules.

Related Reports and InquiriesTo UseList the add rules Benefit Plan Rules Listing (BN216)

Defining Change RulesChange rules determine when a change made by a personnel action affectsan employee�s benefits or flex credits but not his or her eligibility for the plan.Employee Change Benefit Update (BN100) uses change rules to determinethe date when the affected benefits are changed.

NOTE You cannotdefine Change rules foran employee group.

BN100 stops the affected benefits the day before the calculated change dateand adds benefits effective on the change date.

For flex benefits, if an employee switches between groups used as eligibilitycriteria for flex credits calculations on Flex Credits (BN08.1), the BenefitsAdministration application stops all the employee�s benefits under the flexplan. It also stops the employee�s flex dollar record on Employee Flex Credits(BN45.1), adds a new flex credits record for the employee based on theemployee�s new employee group, and re-adds the employee�s flex benefitswith the same elections.


If a personnel action affects an employee�s benefits but no change rulesexist, BN100 lists, but does not update, the employee�s affected benefits.If the employee is deleted from a group but is not added to another groupfor which coverage contributions or general ledger overrides exist, BN100will list an error.



� "When Do I Use Change Rules?" on page 198

Figure 39. Procedure flow: Define Change Rules

1Access ChangeRules (BN16.3)

2Select company,

plan type

3-Optional-

Select the plan

4Type change rules

effective date

5Select personnel

action

6Select benefitchange date

7Choose Add

function


STEPS To define change rules1. Access Change Rules (BN16.3).

Figure 40. Form clip: Using BN16.3 to define change rules


3. Select the plan you want to define change rules. If you leave this field blankthe rule will apply to all plans within the plan type selected.

4. Type the date the change rules are effective. You can vary rules by startdate. This allows you to define unique rules for different periods. If ruleschange, add a new record for the new rules.

5. Select the personnel action that triggers the benefit change.6. Select the date benefits change. The benefit application stops benefits the

day before this date and re-adds benefits for this date.7. Choose the Add function.


List the change rules Benefit Plan Rules Listing (BN216)

Defining Termination RulesTermination rules determine when a benefit stops for an employee whobecomes ineligible for the plan or flex plan because of changes made bypersonnel actions. Employee Change Benefit Update (BN100) uses thetermination rules to automatically terminate the affected benefits and flexcredit records.

If termination rules have been defined for the flex plan and a change causesan employee to be ineligible for a flex plan, BN100 stops the employee�sflex dollar record and all benefits under the flex plan according to the flexplan�s termination rules.




� "When Do I Use Termination Rules?" on page 199


Figure 41. Procedure flow: Define Termination Rules

1Access

Termination Rules(BN16.4)

2Select company,

plan type

3-Optional-

Select the plan

4Type termination

rules effective date

5- Optional -

Select employeegroup

6Select personnel

action

7Define stop rules

8- Optional -

Define COBRAattributes

9Choose Add

function


STEPS To define termination rules1. Access Add Rules (BN16.4).

Figure 42. Form Clip: Using BN16.4 to define termination rules


3. Select the plan for which you want to define termination rules. If you leavethis field blank the rule will apply to all plans within the plan type selected.

4. Type the date the termination rules are effective. You can vary rules bystart date. This allows you to define unique rules for different periods. Ifrules change, add a new record for the new rules.

5. If you are defining termination rules that are unique to a particular group ofemployees, select the employee group for which these add rules apply.

IMPORTANT If you define termination rules by employee group, make sureemployee groups are defined such that an employee can be a member of onlyone group at a time. If an employee belongs to more than one group for whichrules have been defined, benefit update reports list the situation as an error.

6. Select the personnel action that triggers an employee�s ineligibility for theplan.

7. Define the stop rules. Consider the following fields.


Stop Date Select the date used to determine the benefitstop date. If no months or days are entered in thefields that follow, this is the date the benefits stop.

Months Type the number of months after the Stop Datebenefits should stop.

For example, if you want benefits to stop threemonths after the stop date, type 3.

NOTE If you enter a value in the Days field, donot enter anything in this field.

Days Type the number of days after the Stop Datebenefits should stop.

For example, if you want benefits to stop 60 daysafter the stop date, type 60.

NOTE If you enter a value in the Months field, donot enter anything in this field.

8. If the termination rules apply to COBRA participants, define the COBRAattributes. Consider the following fields.

COBRAOccurrence

Select the value that indicates whether thetermination of this benefit is a qualifying COBRAevent and you want the employee to be notifiedof COBRA rights.

Occurrence Type If you selected Yes in the COBRA Occurrencefield, select an occurrence type.

If you select an occurrence type, the applicationcreates a COBRA participant in COBRAParticipant (BN70.1) for employees affected bythese termination rules if the employee does notalready have a COBRA record in BN70.1 for thesame period.


Related Reports and InquiriesTo UseList the change rules Benefit Plan Rules Listing (BN216)


Chapter 12

BN Enrollment: Enrolling Employees inFlex Plans

Before you enroll your employees into benefit plans, you need to enroll theemployees into Flex plans. This chapter outlines procedures and conceptsyou need to enroll employees into flex plans.

Benefits Administration User Guide Chapter 12 BN Enrollment: EnrollingEmployees in Flex Plans

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BNProcesses

MaintainingBN Plans

PlanMaintenance

Flex Plans

Employees

BN PlanEnrollment

BN Company

Preliminaries

Setup

Flex Plan

BN-Plans

BNAutomation

Rules

MaintainEmployee

Enrollments


SavingsBond

Update

Benefit PlanTesting


SpecialProcessing


BN-PlanCoverage



Retirees

You Are Here

BN EntryRules

212 Chapter 12 BN Enrollment: EnrollingEmployees in Flex Plans





� "What is a Flex Credit Record?" on page 213

� "What are Flex Periods?" on page 213

� "When is a Standard Time Record Created by a Flex Plan?" onpage 214

What is a Flex Credit Record?To add flex benefits for a flex plan year, you need to create a flex credit recordfor each employee. An employee flex credit record indicates

� The dates the employee is in the flex plan

� The annual salary used for benefit calculations

� The amount of flex credits an employee receives before electing benefits

� The amount of an employee�s salary that can be spent on a pretax basisto purchase benefits

You can create flex credit records automatically for all employees in a flexplan for an entire flex plan year, or manually for one employee. An employeecan only have one flex credit record in effect for any given date. You canhowever, stop and start a flex credit if you need to change an employee�s flexcredit record information.

What are Flex Periods?A flex benefit period is a time during which a particular combination of anemployee�s flex benefits are in effect during a flex plan year.

Upon initial enrollment into the flex year, the application creates one flexbenefit period for the entire flex plan year for an employee. Each time youadd or stop benefits for an employee during the flex year, another flexbenefit period is created.

ExampleEmployee Lynn Johnson is enrolled in the current flex plan with a flex benefitperiod of January 1, 2000 to December 31, 2000.

On April 1, 2000, her health coverage changes because of a family statuschange. Her flex benefit period dates after the change would now be asfollows:


213

Start Date Stop Date

January 1, 2000 March 31, 2000

April 1, 2000 December 31, 2000

Further into the flex year, Lynn Johnson�s dental benefit has a changeeffective July 1, 2000. The dental benefit was not stopped and restarted whenthe health benefit was, so the application requires a change on the dentalbenefit to reflect the flex benefit period of 04/01/00 - 12/31/00. Then the newstart date of 07/01/96 for the dental benefit can be entered creating anotherflex benefit period of 07/01/00 - 12/31/00.

When is a Standard Time Record Created by a Flex Plan?A time record is created for unused flex credits taken as taxable income.When an employee is enrolled into a flex plan that allows unused flex creditsto be taken as taxable income, the time record is created and is considered aflex standard time record. The flex standard time record is included with theemployee�s other time records in payroll processing.

If the flex plan lets employees keep a percentage of their unspent flexcredits, when the benefit application creates flex credits, the application willalso create a standard time record for each employee. You should enrollemployees in their benefits before the first payroll run of the flex plan yearto offset the standard time record.

See the Payroll User Guide for information on processing standard timerecords.



Procedures in this ChapterBefore an employee can enroll in any benefits under a full flex benefit plan,the employe must have a flex credit record. The following procedures explainhow to automatically or manually create employee flex credit records.

Automatically Create EE FlexCredit Records

Use this procedure to automaticallycreate employee flex credit records.

Manually Create EE Flex CreditRecords

Use this procedure if a flex plangives flex credits based on benefitelection. You can also use thisprocedure to override automaticallygenerated employee flex creditrecords.

Automatically Create EE Flex Credit RecordsThis procedure creates flex credits so that each eligible employee becomes aparticipant in the flex plan. For flex plans where flex credits are issued priorto benefit enrollment, this procedure will automatically calculate flex creditsand create a flex credit record for each employee in a flex plan for the entireflex year. If the employee becomes eligible for the flex plan after the start ofthe flex year, such as a new hire, this procedure will calculate credits andcreate a flex credit record from the employee�s eligibility date to the end ofthe flex year. For flex plans where flex credits are issued based on benefitelections, this procedure is still used to create flex credit records prior toenrolling eligible employees in benefits.

NOTE You can use thisprocedure to recalculateflex credits until youenroll employees inbenefits.

Once you run Employee Flex Credits (BN145) in update mode, flex creditrecords are created for those eligible employees. If the flex plan letsemployees keep a percentage of their unspent flex credits, also when theapplication creates flex credits, it creates a standard time record, whichrepresents an employee�s flex credits that are added to his or her taxablewages.

NOTE If your companyhas more than one flexplan, an employee canonly be enrolled in onlyone of those plans.





STEPS To automatically create EE flex credit records1. Access Flex Credits Calculations (BN145).


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TIP Before you update,review the flex creditsetup by selectingReport Only in theUpdate field.

2. Type the name of the job in the Job Name field.3. Type a job description in the Job Description field. The job description helps

you identify a batch job by providing additional information.4. Complete the information in the Parameters section. Consider the following

fields.

Company Name Select the company for the flex plan.

Flex Plan Select a flex plan.

Start Date Type the flex plan year start date. This startdate determines which plan parameters on FlexCredits (BN08.1) are used to create flex credits.

Employee Group To calculate flex credits for employees in aparticular group, select the employee group.

IMPORTANT The employee group you selectmust match the employee group for which flexcredit parameters were defined on BN08.1.

All Groups Type X to run the update or report for all employeegroups for which the flex credits parameters weredefined on BN08.1.

Report Sequence Select how you want to sort the report by group,user level, supervisor or employee.

EmployeeSequence

If you want to override the defined print order,select either alphanumeric (employee name) ornumeric (employee number).

If you leave this field blank, the application usesthe order defined on Company (HR00.1).

Update Select either Update or Report Only.

If you select Update, BN145 creates a flex createrecord for each eligible employee. If you changeflex credit parameters and re-run BN145 toUpdate. The application recalculates flex credits.You can recalculate flex credits using BN145 untilyou enroll employees in benefits.

CAUTION Run this form in Report Onlyfirst to review employee flex credits.Then run this report as Update.

5. Choose the Add function.6. Submit the report.



Related Reports and InquiriesTo UseView the flex credits an employeereceived for electing a benefit

Flex Benefits Inquiry (BN46.2)

View the flex benefit periods for anemployee

Flex Benefit Periods (BN46.1)

Manually Create EE Flex Credit RecordsThis procedure enables you to manually add flex credit records for anemployee.You can also use this procedure to override automaticallygenerated employee flex credit records.

NOTE If your companyhas more than one flexplan, an employee canonly be enrolled in onlyone of those plans.

For each employee, the following appears on the form: annual salary, basedollars, number of flex credits given before benefit election, pre-tax dollarlimits, and the total flex and pre-tax dollars.

Base dollars are the flex credits given to every eligible employee in the flexplan. If the flex credits calculated for an employee are greater than theplan�s maximum or less than the plan�s minimum, the min./max adjustmentsincrease or decrease the flex credits based on those parameters.





STEPS To manually create EE flex credit records1. Access Employee Flex Credits (BN45.1).

Figure 43. Form clip: Using BN45.1 to manually create employee flex credit records


217

2. Enter information for employee inquiry. Consider the following fields.


Employee Select an employee.

Start Date Type the employee�s flex credit record start date.

An employee can have more than one flex creditrecord for the flex plan year. If an employee hasmultiple flex credit records the start dates cannotoverlap.

Flex Plan Select a flex plan.

The flex plan of this field determines the flexcredit the employee receives and the benefitplans for which the employee is eligible.

3. Choose the Add function4. Enter additional employee information. Consider the following fields.

Stop Date Type the stop date for this flex credit record. Ifyou leave this field blank, the stop date defaultsto the last day of the flex plan year.

Annual Salary If you want to override the employee�s annualsalary on which flex credits are based, type anew annual salary.

The Benefits Administration applicationdetermines the salary used for flex calculationsusing the parameters defined in the Salarysubform of Flex Credits (BN08.1).

5. Choose the Recalculate form function. This generates the fields that holdflex credit amount and pre-tax amounts.

6. Complete the Flex Credits section. Consider the following fields.

Base Dollars This field displays the base dollar amount thecompany gives to the employee to buy benefitsfor the plan year. This value is the total of thebase amount plus a percentage of the employee�ssalary, as defined in Flex Credits (BN08.1).

Service Credits The number of credits an employee receivesbased on years of service displays; you canoverride this amount. Credits for years of serviceare added to the total flex credits available for theemployee to buy benefits.

The Benefits Administration applicationdetermines the years of service credits usingthe parameters defined in the Service Creditssubform of Flex Credits (BN08.1).



Age Credits The number of credits an employee receivesbased on age displays; you can override thisamount. Credits for age are added to the total flexcredits available for the employee to buy benefits.

The Benefits Administration applicationdetermines age credits using the parametersdefined in the Age Credits subform of FlexCredits (BN08.1).

DependentCredits

The number of dependent credits an employeereceives displays; you can override this amount.Credits for dependents are added to the total flexcredits available for the employee to buy benefits.

The Benefits Administration applicationdetermines the number of dependents using theHealth Dependents field in the Benefits form tabof Employee (HR11.1).

The Benefits Administration applicationdetermines dependent credits using theDependents Credits subform of Flex Credits(BN08.1).

Lifestyle Credits The number of credits an employee receivesbased on lifestyle points displays; you canoverride this amount. Credits for lifestyle areadded to the total flex credits available for theemployee to buy benefits.

An employee�s lifestyle credits are defined in theBenefits form tab of Employee (HR11.1).

The Benefits Administration applicationdetermines lifestyle credits using the parametersdefined in Lifestyle Credits defined in Flex Credits(BN08.1).

7. If you want to override the total pretax dollars that an employee can use tobuy benefits, type the new amount.

8. Choose the Change form function.

IMPORTANT If you override any field on BN 45.1, Flex Credit Calculation(BN145) will not calculate the employee�s flex or pretax dollars for theremainder of the flex plan year.


219

Related Reports and InquiriesTo UseView the flex credits an employeereceived for electing a benefit


View the flex benefit periods for anemployee

Flex Benefit Periods (BN46.1)



Chapter 13

BN Enrollment: Enrolling Employees inBenefit Plans

This chapter focuses on those procedures you need to initially enroll youremployees into benefit plans.

STOP If you are enrolling employees into benefits under a flex plan, theemployee must have a flex credit record. See " BN Enrollment: EnrollingEmployees in Flex Plans" on page 211.

STOP If you want vacation benefits to update a time accrual plan, theemployee must have a time accrual record. See the Time ManagementUser Guide.

STOP If you want to enroll dependents verify that the following is done:dependents are defined in the HR application, dependents are flagged as Yeson BN00.1, and the plan is defined to allow dependents. See " Setup: BNCompany" on page 33 and " Setup: Benefits Plan" on page 79.

Benefits Administration User Guide Chapter 13 BN Enrollment: EnrollingEmployees in Benefit Plans

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BNProcesses

MaintainingBN Plans

PlanMaintenance

Flex Plans

Employees

BN PlanEnrollment

BN Company

Preliminaries

Setup

Flex Plan

BN-Plans

BNAutomation

Rules

MaintainEmployee

Enrollments


SavingsBond

Update

Benefit PlanTesting


SpecialProcessing


BN-PlanCoverage



Retirees

You Are Here

BN EntryRules

222 Chapter 13 BN Enrollment: EnrollingEmployees in Benefit Plans




� "How do I Enroll Employees into Benefit Plans?" on page 223

� "What is an Eligibility Date?" on page 223

� "What is a Start Date?" on page 224

� "What Happens When I Override Salary?" on page 224

How do I Enroll Employees into Benefit Plans?An employee is eligible for a plan if he or she has met the plan�s employeegroup and or benefit postal code eligibility criteria. You enroll eligibleemployees by creating employee benefit records. Each employee benefitrecord includes specific information about an employee�s enrollment ina particular benefit plan, including effective dates, coverage level, andcontribution amount.

After you have set up your benefit plans and established employee flex creditrecords for those employees who may enroll in flex benefits, you are nowready to perform an initial enrollment of employees. You can enroll employeesinto benefit plans using the following methods:

� Automatically enroll eligible employees in default plans with the appropriatedefault coverage and default contribution

� Manually enroll multiple employees in plans or enroll one employee in mul-tiple plans

� Using Employee Self-Service via the web, where the employees can enrollthemselves

When you enroll an employee into a benefit plan, employee and companydeductions are created. The benefit�s start and stop dates are used to controlthe deductions. For flex benefit plans, the application creates or updates anemployee�s standard time record.

For more information on employee standard time records, see the PayrollUser Guide.

What is an Eligibility Date?This date determines when an employee is qualified to enroll into the benefitplan. There are two major considerations concerning eligibility dates:

� The eligible date for the employee is calculated from the entry rules definedfor the plan. See " Setup: Benefit Entry Rules" on page 113 for moreinformation.


223

� An employee cannot enroll in a benefit plan with a start date prior to theireligible date. They can enroll with a later date, provided the date complieswith entry points on the plan�s entry rules.

ExampleIf the employee�s eligible date for the benefit is June 1, 2000, the start datefor the benefit can be June 1, 2000 or any later date that qualifies with theentry rules.

What is a Start Date?All employee benefit records have a start date to signify when the enrollment(or participation) begins. This date becomes the effective date for thedeductions created by the enrollment. You can enter the date at the timeyou enroll employees into benefit plans. If you decide not to specify a startdate at the time of enrollment, the employee�s eligible date will default(according to the plan entry rules).

The start date can never be before the employee is eligible for the benefit.It can be after the employee is eligible if the date qualifies with the entryrules on the plan.

ExampleThe start date for your health insurance is May 1, 2000. You are entering anemployee who is not eligible until June 1, 2000, the application will display amessage that the employee is not eligible until June 1, 2000. To enroll theemployee you must use a start date of June 1, 2000 or later.

What Happens When I Override Salary?You may have special situations you need to override an employee�s salaryfor benefit purposes. For example, your life insurance policy has coveragebased on employee salary. You have a newly-hired, commissioned employee,and you want to base the insurance benefit on a higher salary than what theplan will use to calculate coverage. When you enroll this employee, you canoverride their salary by entering a specific salary amount.

When you override an employee�s salary there are consequences that affectfuture benefit updates. The salary amount is stored as an overridden value,and the benefit update programs will not recalculate coverage for any futuresalary changes unless the override is removed. If you find you are overridingsalary for a large number of employees, you may want to reconsider the setup of your benefit plan to determine if there is a more efficient way for theapplication to determine covered salary.



Procedures in this ChapterThe following procedures enable you to initially enroll employees into benefitplans.

Generating Benefit EnrollmentForms

Tasks to create benefit electionor confirmation forms for youremployees.

Enrolling EmployeesAutomatically into DefaultPlans

Tasks to enroll many eligibleemployees into benefit plans andinto default plans.

Manually Enrolling an Employeeinto Multiple Plans

Tasks to enroll an employee intobenefit plans by plan type.

Enrolling Dependents Tasks to enroll employee dependentsinto benefit plans.

Enrolling Multiple Employees intoPlans Manually

Tasks to add multiple employeesinto benefit plans.

Assigning Beneficiaries to a Plan Tasks to assign beneficiaries foran employee�s disability, employeelife, defined benefit and definedconribution benefits.

Assigning Savings BondBeneficiaries

Tasks to define each savingbonds possible owner, co-ownerand beneficiary purchase by anemployee.

Generating Benefit Enrollment FormsThis procedure enables you to run a report to create benefit election andconfirmation forms. This report displays the plans in which an employee iseligible, the plans which an employee is enrolled in or both.


225

STEPS To generate benefit enrollment forms1. Access Benefit Election Form (BN245).

Figure 44. Form clip: Using BN245 to generate benefit enrollment forms

2. Complete the information in the Parameters section.3. If you want to create a data file so you can use to export this information

into an external software product, select either �Both Report and CSV� or�CSV Only� in the Report Option field.


Enrolling Employees Automatically into Default PlansUse this procedure to enroll employees in default plans with default coverageand contributions. You can also use this procedure to list the employeeseligible for benefit plans. You can use the report to display all employeesin a company or for employees in a process level, a processing group, oran employee group.

In this procedure you can indicate the date you want the application to useto determine the appropriate plans and eligibility criteria. For a plan withyears-of-service measured in hours, the application uses each employee�spay history to determine whether the employee has met the plan�s years ofservice requirement on this date.

IMPORTANT If you enroll an employee during a payroll cycle after Earningsand Deduction Calculation (PR140) runs, and you want to include thedeductions from the new benefits in the current payroll run, change theemployee�s time records to error status and re-run PR140.







STEPS To automatically enroll employees into default plans1. Access Mass Benefit Add (BN101).

Figure 45. Form clip: Using BN101 to enroll employee into default plans


you identify a batch job by providing additional information.NOTE If an employeebenefit already existswith a future effectivedate, the applicationwill add another benefitrecord with a stop dateone day prior to the startdate on the record thatalready exists.

4. Complete the information in the Parameters section. Consider the followingfields.

Company Name Select the company for the plan.

Plan Type Select the plan type you want to include in thereport or update. You must select at least oneplan type.

Plan Select the specific benefit plan you want toinclude in the report or update.

If you leave this field blank, the report or updateincludes all plans of the benefit plan type(s) youselected.

Processing Group If you want to include benefits for only thoseemployees in a particular processing group,select the processing group.

NOTE If you select a processing group, leave theProcess Level and Employee Group fields blank.


227

Process Level If you want to include benefits for only thoseemployees in a particular processing level, selectthe process level.

NOTE If you select a process level, leave theProcessing Group and Employee Group fieldsblank.

Employee Group If you want to include benefits for only thoseemployees in a particular employee group, selectthe employee group.

NOTE If you select a processing group, leavethe Process Level and Processing Group fieldsblank.

As of Date Type the date you want the application to use todetermine the appropriate plans and eligibilitycriteria.

If you select No for the Use Eligibility Date field,the application uses this date as the benefit startdate for all employees eligible for the benefit asof this date. All employees updated will have thesame benefit start date (enrollment date).

Use EligibilityDate

Select Y(Yes) if you want each employee enrolledon his or her own eligibility date.

Select N(No) if you want all your employeesenrolled on the As of Date.

CreateDependents

Select either Y(Yes) or N(No) to indicate if youwant to add coverage for each of an employee�seligible dependents.

If a dependent�s age exceeds the dependent orstudent ages defined for the plan, coverage forthe dependent is not added.

Create Investment Select either Y(Yes) or N(No) to indicate if youwant to add a investment account distribution fordefined contribution benefits.

If you select Yes, the application will use thedefault investment option defined on the plan.



Date Range Type the beginning and or the ending date of adate range to include only employees who areeligible in the date range.

If you type only a beginning date, employeeswith eligibility dates equal to or later than thebeginning date will be included. If you type onlyan ending date, employees with eligible datesequal to or earlier than the ending date areincluded.

If you select Yes for Use Eligibility Date and youalso type a date range, the application will onlyadd benefits for employees with eligibility dateswithin the date range. This is used to controlthe addition of future-dated benefits. You mayonly want to add those benefits for which theemployee is eligible during the next month.

If you select Yes for Use Eligibility Date and youleave the date range blank, benefits are added forall employees on their calculated eligibility date.

Report Sequence Select if you want the report sorted by employee,or process level/department.

EmployeeSequence

If you select employee in the Report Sequencefield, select how you want employees sortedeither alphanumeric (employee name) or numeric(employee number).


If you select Report Only the application listsemployees with their eligibility dates.

If you select Update, the application createsbenefits for eligible employees and lists the newbenefits.

CAUTION Run in Report Only toreview the accuracy of the employeeenrollments. Then run this report inUpdate mode.



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Related Reports and InquiriesTo UseEnroll employees based on addrules

Employee Plan Update (BN100)

See "What Happens When I AddBenefits Using Automation Rules?"on page 250 for more information.

Manually Enrolling an Employee into Multiple PlansThis procedure outlines tasks to enroll an employee in benefit plans byplan type. The plans for which an employee is eligible display on the form.Plans display according to the benefit process order that applies to theemployee. If no benefit process order applies to the employee, plans appearin alphabetical order by plan type. See " Setup: BN Preliminaries" on page45 for more information. You can only add employee benefit with using the�Enrolling an Employee Manually into Multiple Plans, procedure. To changeor stop benefits, see "Stopping EE Benefits" on page 259 or "ManuallyChanging EE Benefits" on page 260.

IMPORTANT If you enroll an employee during a payroll cycle after Earningsand Deduction Calculation (PR140) runs and you want to include thedeductions from the new benefits in the current payroll run, change theemployee�s time records to error status and rerun PR140.








Figure 46. Procedure flow: Enrolling an Employee into Multiple Plans

1Access Employee

Benefit Entry(BN31.2)

2Select company

3Select theemployee

4Type the date

5- Optional -Select plans

6Choose Inquire

function

7- Optional -

Type start date

8Enter planinformation

9- Optional -

Complete theMore tab

10- Conditional -

Identify investmentaccounts

11Choose Add

function

STEPS To enroll an employee into multiple plans1. Access Employee Benefit Entry (BN31.2).


231

Figure 47. Form clip: Using BN31.2 to enroll an employee into multiple plans

2. Select the company from the Company field.3. Select the employee you want to enroll from the Employee field.4. Type the date you want to use to determine the appropriate plans and eli-

gibility criteria for employees, in the As of date field. Plans that have a stopdate before this date do not appear. If you leave this field blank, the currentsystem date defaults.

5. If you want to limit which plans appear on the form, select the desired typesin the Plan Type fields.

TIP Plans in which theemployee is alreadyenrolled will have anasterisk (*) beside them.

6. Choose the Inquire function. The plans for which an employee is eligibleappear on the display.

7. If you want a different start date than what the application uses, type thenew date.

TIP Drill around onany field in a line fora given plan to viewthe coverage optionsavailable.

8. Enter the information for those plans in which you want to enroll an em-ployee. Enter information in the fields according to the table below. Youwill enter information only in one field per plan.

If the Plan Type is Then

Coverage Options (1)(Medical/Dental)

Select the coverage option in theOpt field. If the plan is definedwith a default coverage level, youmay leave this field blank and thecoverage will default.

Leave the remaining fields blank,unless you want to use anotherstart date.




Coverage Amounts (2) andcalculation type Multiple of Salary(LIfe/Disability)

Type the multiple of salary in theMulti field. If the plan is definedwith a default coverage level, youmay leave this field blank and thecoverage will default.

Leave the remaining fields blank,unless you want to use anotherstart date. You can also enter adifferent salary in the Sal, Annualfield.

Coverage Amounts (2) andcalculation type Supplemental

Type the coverage amount in theCov, PayPer field. If the plan isdefined with a default coveragelevel, you may leave this field blankand the coverage will default.


No Coverage and the contributionamount is a percentage or amount

Type the employee�s annualcontribution or percentagecontribution, in the Sal, Annualfield.

Leave the remaining fields blank,except if you want to use anotherstart date.

No Coverage and the contributionamount is an amount

Type the employee�s per payperiod contribution, in the Cov,PayPer field.


If the benefit is under a flex plan(contribution limits) and this is apartial year enrollment, enter thenumber of times the deductionshould be taken in the Opt field.

9. If you want to specify if the contribution entered should be an amount orpercent, taken on a pre-tax or after-tax basis; to identify if the employee isa smoker; or that you require evidence of insurability, complete the Moresection. Consider the following fields.


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Pct,Amt Select either amount or percent. If the planspecifies only an amount or only a percentcontribution, when you add the benefit it willdefault to that option.

Pre,Aft Select the value that indicates whether theemployee wants to contribute on a pretax basis,an after-tax basis, or both. The value of this fielddetermines how the employee�s contribution issplit in the Pretax and After-Tax fields in the Moredetail tab.

If you select Both, you must enter the pretax andafter-tax amounts on the More Detail tab.

If you leave this field blank, the default tax typedefaults. The default tax type is defined in theDefault Tax Type field of the contribution form forthis plan.

10. To identify those investment accounts for a defined contribution, select theInv button. This button only appears for those plans that allow investmentchoices.


Options for enrolling employees into multiple plansThe following options are available from Employee Benefit Entry (BN31.2).

Choose the Dep button to access Dependents (HR13.2). Use this form toenroll employee dependents. See "Enrolling Dependents" on page 240.

Choose the Benef button to access Beneficiaries (BN47.1). Use this formto assign beneficiaries to a plan. See "Assigning Beneficiaries to a Plan"on page 241.

Choose the SB Benef button to access Saving Bond Beneficiaries (BN48.1).Use this form to assign saving bond beneficiaries. See "Assigning SavingsBond Beneficiaries" on page 241.

Choose the Comment button to enter any comments.

Choose the Added Ben button to verify that all the employee�s informationwas created when a new benefit was added.

Related Reports and InquiriesTo UseList employees enrolled in a benefitplan

Plan Participant Report (BN230)

List all benefits in which employeesare enrolled

Employee Benefit Report (BN231)

Create personalized benefitstatements for employees

Benefits Statement (BN232)



To UseList plan participants for DefinedBenefit and Defined Contributionplans

Participation Report (BN236)

Create benefit statements toestimate the cost of employeebenefits

One Page Benefit Statement(BN242)

List employees whose benefits havenot been completely added for theflex plan year

Flex Missing Benefits Reports(BN246)

List employees who have notselected benefits or those who havenot completed flex benefit selectionsfor the flex plan year

Benefit Exception Report (BN325)

Display plans an employee isenrolled

Employee Benefit Summary(BN51.1)

Display an employee�s annualcontributions and deductions in abenefit plan

Employee Benefit Detail (BN51.2)

Display participants of a plan as of aspecific date.

Current Plan Participants (BN50.1)

Display an employee�s flex periods Flex Benefit Periods (BN46.1)

Display an employee�s use of flexand pretax dollars for a flex benefitperiod


Enrolling Multiple Employees ManuallyThis procedure outlines tasks to add multiple employees into benefit plans.You can only add employees to benefit plans using this procedure. If youwant to change or stop benefits for employees, see " BN Enrollment: MaintainEmployee Enrollments" on page 243.

IMPORTANT If you enroll an employee during a payroll cycle after Earningsand Deduction Calculation (PR140) runs and you want to include thedeductions from the new benefits in the current payroll run, change theemployee�s time records to error status and rerun PR140.


235






Figure 48. Procedure flow: Enrolling manually multiple employees

1Access Employee

Benefit Entry(BN31.2)

2Select company

3- Optional -

Type start date

4Select Employee,Benefit Plan Typeand Benefit Plan

5Enter planinformation

6- Optional -

Complete theMore section

7Choose the Add

function

STEPS To enrolling manually multiple employees1. Access Speed Benefit Entry (BN31.1).2. Select the company from the Company field.3. If you want all added benefits to have the same start date, type the default

start date in the Start Date field.

If you leave this field blank, each employee�s eligibility date becomesthe default.



4. Select the Employee, Benefit Plan Type, and Benefit Plan for the enroll-ment you want to add, in fields Employee, PL TP, and Plan Code.

5. Enter information in the fields according to the table below. You will enterinformation only in one field per plan.


Coverage Options (1)(Medical/Dental)

Select the coverage option in theOpt field.


Coverage Amounts (2) andcalculation type Multiple of Salary(Life/Disability)

Type the multiple of salary in theMulti field.

Leave the remaining fields blank,except if you want to use anotherstart date. You can also enter adifferent salary in the Sal, Annualfield.

Coverage Amounts (2) andcalculation type Supplemental

Type the coverage amount in theCov, PayPer field.

Leave the remaining fields blank,except if you want to use anotherstart date. You can also enter adifferent salary in the Sal, Annualfield.

No Coverage and the contributionamount is a percentage or amount

Type the employee�s annualcontribution or percentagecontribution, in the Sal, Annualfield.


No Coverage and the contributionamount is an amount

Type the employee�s per payperiod contribution, in the Cov,PayPer field.


If the benefit is under a flex plan(contribution limits) and this is apartial year enrollment, enter thenumber of times the deductionshould be taken in the Opt field.

6. In the PreAft (Pretax or After-tax) field, select the value that indicateswhether the employee wants to contribute on a pretax basis, an after-tax


237

basis, or both. The value of this field determines how the employee�scontribution is split in the Pretax and After-Tax fields on the More detailtab. If you leave this field blank, the default tax type defaults. The defaulttax type is defined in the Default Tax Type field of the contribution formfor this plan.

7. In the SM (Smoker) field, indicate the smoker status.8. From the More tab, consider the following fields. If you selected Both in

the PreAft field, you must enter the pre-tax and after-tax amounts.

PreTax If the employee elected both apretax and after-tax contribution,type the employee�s pretaxcontribution. The application usesthe Pretax field to determine thenext amount for the employee�spretax deduction.

If the employee�s contribution isonly pretax, leave this field blank.The total annual contributiondefaults to the Pretax field basedon the Pre Aft field.

After-Tax If the employee elected both apretax and after-tax contribution,type the employee�s after-taxcontribution.

If the employee�s contributionis only after-tax, leave thisfield blank. The total annualcontribution defaults to theAfter-Tax field based on the PreAft field.

Stop Date Type a date to terminate theemployee�s coverage.

The stop date defaults as theend date of deductions created inEmployee Deduction (PR14.1) forthis plan. If the benefit plan is tiedto a flex plan, the flex plan yearstop date will default.

You can stop a benefit with a futuredate. That is, you can type a futurestop date on the benefit at anytime. The employee�s benefit anddeductions will stop on that date.




Options for manually enrolling multiple employeesThe following options are available from Employee Benefit Entry (BN31.2).

Choose the Benef button to access Beneficiaries (BN47.1). Use this formto assign beneficiaries to a plan. See "Assigning Beneficiaries to a Plan"on page 241.

Choose the SB Benef button to access Savings Bond Beneficiaries (BN48.1).Use this form to assign saving bond beneficiaries. See "Assigning SavingsBond Beneficiaries" on page 241.

Related Reports and InquiriesTo UseList employees enrolled in a benefitplan

Plan Participant Report (BN230)

List all benefits in which employeesare enrolled

Employee Benefit Report (BN231)

Create personalized benefitstatements for employees


List plan participants for DefinedBenefit and Defined Contributionplans


Create benefit statements toestimate the cost of employeebenefits

One Page Benefit Statement(BN242)

List employees whose benefits havenot been completely added for theflex plan year

Flex Missing Benefits Reports(BN246)

List employees who have notselected benefits or those who havenot completed flex benefit selectionsfor the flex plan year

Benefit Exception Report (BN325)

Display plans an employee isenrolled










239

Enrolling DependentsThis procedure enables you to enroll dependents into benefit plans afteryou have enrolled employees. The application will generate possible startand stop dates for dependents based on the employee�s start date and themaximum dependent and student ages defined on the plan. You can overridethe system-generated dates with later start dates if desired.

STOP Before you can enroll dependents, you need to enroll the employeeinto the benefit plan and choose a benefit option that covers dependents.

STEPS To enroll dependents1. Choose the Dep button on Employee Benefit Entry (BN31.2), to open De-

pendents (HR13.2).

Figure 49. Form clip: Using HR13.2 to enroll dependents

2. Select the Add line function for those dependents you want to enroll.

TIP If you want toenroll dependentsat a later date, useDependent (HR13.1),Coverage tab, andchoose the Benefitsbutton.

3. If you want a different start date than what the application uses, type thenew date. You cannot enroll a dependent with a date earlier than the em-ployee�s start date.

NOTE An asterisk (*)appears next to thedetail line, indicating thedependent is enrolled.


Related Reports and InquiriesTo UseList dependents Dependent Benefit Listing (BN321)



Assigning Beneficiaries to a PlanThis procedure enables you to assign beneficiaries for an employee�sdisability, employee life, defined benefit and defined contribution benefits.

STOP Before you can add beneficiaries, you need to enroll the employeeinto the benefit plan.

STEPS To assign beneficiaries1. Choose the Benef button, Employee Benefit Entry (BN31.2), to open Ben-

eficiaries (BN47.1).

TIP There is no fieldlevel security asigned tothe beneficiary�s SocialNumber. You carefullyconsider securityaccess to this form toprotest the beneficiarysocial numbers.

2. Select the benefit type you want to assign beneficiaries.3. Select the benefit plan.4. Type the beneficiary�s name in the Last Name, First Name and MI fields.5. Enter the beneficiary information. Consider the following fields.

Percent Amount Select if benefits are assigned as a percent of thetotal benefit or as a flat dollar amount.

Amount Type the percent or dollar amount you want paidto the beneficiary.

NOTE The total percent cannot exceed 100.

Type Select if the beneficiary is an individual or a trust.

Primary orContingent

Select if the beneficiary is a primary or contingent.

6. Choose the Add button.

Related Reports and InquiriesTo UseList employee beneficiaries fordisability, employee life, definedcontribution, and defined benefitplans

Beneficiary Listing (BN247)

Assigning Savings Bond BeneficiariesThis procedure defines each possible owner, co-owner and beneficiary forsavings bonds purchased by an employee.


241

STEPS To assign investment choices1. Choose the SB Benef button, on Employee Benefit Entry (BN31.2), to open

Savings Bond Beneficiaries (BN48.1).2. Type the code that represents the savings bond owner, co-owner, or ben-

eficiary.3. Complete the form. Consider the following fields.

Dependent If the owner or beneficiary is the employee�sdependent with a record in Dependent (HR13.1),select the dependent.

Social Nbr If the person is not an employee or a dependentfrom HR13.1, type the person�s social number.

If you leave this field blank, information willdefault from Employee (HR11.1) or Dependent(HR13.1).

4. Type the owner or beneficiary�s last name, first name and initial in the Namefield.

5. Type the owner or beneficiary�s address in the provided fields. If the depen-dent has a record in Dependent (HR13.1), you can override the addresson HR13.1.


Related Reports and InquiriesTo UseList the sequence savings bonds arepurchased for owner, co-owners andbeneficiaries of savings bonds

Savings Bond Sequence Listing(BN248)

Purchase savings bonds Savings Bond Update (BN140)

See "Updating Stock Purchases" onpage 312.



Chapter 14

BN Enrollment: Maintain EmployeeEnrollments

This chapter focuses on the procedures that enable you to maintain youremployee�s enrollments.

If you use personnel actions and employee groups, you need to verify that onthe Individual Action (PA52.1-5), the Update Benefits indicator is set to Yes. Ifthe indicator is set to No, change records are not created. See the PersonnelAdministration User Guide for more information.

Benefits Administration User Guide Chapter 14 BN Enrollment: MaintainEmployee Enrollments

243



BNProcesses

MaintainingBN Plans

PlanMaintenance

Flex Plans

Employees

BN PlanEnrollment

BN Company

Preliminaries

Setup

Flex Plan

BN-Plans

BNAutomation

Rules

MaintainEmployee

Enrollments


SavingsBond

Update

Benefit PlanTesting


SpecialProcessing


BN-PlanCoverage



Retirees

You Are Here

BN EntryRules

244 Chapter 14 BN Enrollment: Maintain EmployeeEnrollments





� "What are Benefit Change Audit Records?" on page 245

� "How does Lawson Process Benefits?" on page 246

� "What are Stop Dates?" on page 246

� "What Must I Consider When Manually Changing a Flex Benefit?"on page 247

� "How Do I Make Flex Mid-Year Changes?" on page 247

� "What Happens when I Stop Benefits Using Automation Rules?"on page 248

� "What Happens when I Change Benefits Using AutomationRules?" on page 249

� "What Happens When I Add Benefits Using Automation Rules?"on page 250

What are Benefit Change Audit Records?When certain types of changes occur for an employee, the BenefitsAdministration application creates a record called a benefit change auditrecord. The application will create this record when a personnel actiondefined to update benefits changes employee data that may affect benefits.The record created determines which benefits are updated in Lawson. Ifyou do not want benefits to be updated, you can hold or delete the benefitchange audit record that is created.

See the Personnel Administration User Guide for more information onpersonnel actions.

The following changes will cause the application to create a benefit changeaudit record:

� Adding or removing an employee from an employee group used for benefits

� Changing the employee�s postal code

� Changing an employee�s salary. Changes to all of the following infor-mation is considered a change to an employee�s salary: job code, FTE(Full-Time Equivalent), rate of pay, step, grade, schedule, salary class orbenefit salaries 1 through 5

� Changing the employee�s pay frequency

� Changing one of the following: employee�s birthdate, age, years of serviceor smoking status


245

To create a benefit change audit record, employee changes must be madeusing personnel actions. If the membership criteria for an employee groupused for benefits is changed, benefit change audit records will be createdfor employees who are added or removed from the group when you updatethe group. Changes made directly to employee master records will notcreate benefit change audit records.

Changes to benefit enrollments are entered into Lawson as a stop and startof the benefit record. If a benefit plan has entry rules defined with specificre-enrollment points, the date used to re-add the benefit must comply withthe rules.

What are Stop Dates?The stop date entered on an employee�s enrollment is the date a benefit ends.This date also becomes the end date on the benefit�s deductions.

For changes to employee�s benefits that you know ahead of time, a futurestop date can be entered for the benefit.

If an employee�s benefit changes, Lawson recommends that you do notchange the employee�s current benefit. Instead, stop the current benefit andre-add the employee in the same plan with the new coverage or contributions.Re-adding the benefit provides an online audit trail of changes.

Example of future stop dateIn the beginning of May 2000, an employee who currently has healthcoverage notifies the benefits department that she will be going on to herspouse�s health plan effective the first of July 2000. The stop date of June30, 2000 would be entered upon notification and the employee�s benefit anddeductions would not stop until that date.

Example of changing a current benefitAll benefit changes at River Bend Hospital need to be effective by the first ofthe month. When an employee notifies the benefits department in mid-July2000 that with the birth of her first child she wants to change from �single +one� to �full family� coverage. The benefits department will input a stop dateof July 31, 2000 on her current health benefit and add another benefit for thesame plan with the full family option for August 1, 2000.

This will leave an audit trail of when the employee changed coverage from�single + one� to �full family�.

How does Lawson Process Benefits?When you update benefits automatically, Lawson updates benefits in thefollowing sequence:



1. Stop benefits for which an employee is no longer eligible.2. Change benefits in which an employee is enrolled, but who now qualifies for

different coverage, contributions, or general ledger overrides. To changea benefit, the application stops and re-adds the benefit.

3. Add the employee into plans for which the employee has become eligible.The application enrolls employees into default plans with the applicabledefault coverage, default contribution, and default contribution tax type de-fined for each plan.

If an employee has dependents, you can create dependent benefit coveragefor default plans that cover dependents.

What Must I Consider When Manually Changing a FlexBenefit?

How you stop or change benefits under a flex plan depends on how thebenefit plans are set up.

If your benefit plans with negative contributions are treated separately, oryour benefit plans with positive contributions do not spend flex credits, eachbenefit plan under the flex plan is independent. Therefore, stopping onebenefit does not affect other benefits.

If, however, benefits with negative contributions are combined as one total orbenefits with positive contributions spend flex and pretax dollars, the order inwhich you stop flex benefits is important.

After you free flex credits by stopping a benefit that spends flex credits, orby changing a benefit so it spends fewer flex credits, you can change otherbenefits to spend flex credits rather than pretax dollars.

If your flex plan lets an employee change his or her benefits multiple-timesduring a flex plan year, Lawson recommends that you stop and reenter all ofan employee�s benefits each time an employee�s benefit changes. By doingso, you can easily see which benefits are in effect during each flex benefitperiod and how flex credits were spent.

ExampleCarol, an ABC Foods employee, has a dental benefit that gave her $200 inflex credits and a health benefit that cost her $200 in flex credits. ABC Foodsdefined the benefits so that the Benefits Administration application uses theflex credits from the dental benefit to pay for the health benefit. Carol elects tostop the dental benefit; to do so, she must have $200 in flex credits. ABCFoods frees the flex credits by stopping the health benefit before stoppingthe dental benefit.

How Do I Make Flex Mid-Year Changes?There are two approaches to making flex mid-year changes. You can stopand re-add all benefits, or stop and re-add only the affected benefits.


247

The decision to stop and re-add all benefits tied to the same Flex plan or stopand re-add only those affected benefits depend on the following:

� The number of changes per employee during the plan year

� The number of benefits tied to each employee

� The automation programs used during the plan year

Advantages and Disadvantages for stopping andadding all benefitsThe following are the advantages:

� Flex periods remain in sync

� No Flex period edit

� Re-spend flex credits if stopping benefits frees flex credits

The following are the disadvantages:

� Possible numerous stops and re-adds for one employee

� Insurance carrier report possibly affected by unnecessary stops and adds

Advantages and Disadvantages for stopping andadding only affected benefitsThe following are the advantages:

� Less manual maintenance

� Fewer unnecessary stops and adds in reports

The following are the disadvantages:

� A Flex period edit will occur when other changes are made to flex benefitstied to an employee

See "What are Flex Periods?" on page 213, for more information.

What Happens when I Stop Benefits Using Automation Rules?Benefits are stopped based on termination rules, if a personnel action causesan employee to be ineligible for the benefit. An employee is no longer eligiblefor a benefit if either of the following is true:

� The employee is deleted from an employee group used to qualify an em-ployee for the plan

� The employee�s postal code changes so that it no longer matches one inthe postal code table for the plan

If an employee is deleted from the employee group assigned to a flex plan,the employee�s flex credit record and all the employee�s benefits underthe flex plan stop.



The application calculates the stop date for a benefit using the Stop Date,Months, and Days information defined in the rule. If no termination ruleexists, the affected employee benefits are listed by the update programbut not terminated.

A COBRA record is created if the termination rule is defined as a COBRAoccurrence. The employee�s occurrence date is the day after the employee�scalculated benefit stop date.

The Benefits Administration application uses the occurrence date andtermination date to define a COBRA period. If the benefit stop date falls withinan existing COBRA period, a new COBRA record is not created.

See "What are Benefit Automation Rules?" on page 197 for more information.

What Happens when I Change Benefits Using AutomationRules?

The Benefits Administration application uses Change Rules to updateemployee benefits for the following:

� The employee�s membership in an employee group changes, qualifyinghim or her for different coverage, contributions, or general ledger overridesin the same plan.

� The employee�s salary changes and the employee is still eligible for theplan. The salary used for the calculations is the employee�s current salary.

NOTE In the Benefitapplication there is aprogram that updatesbenefits for salarychanges without usingchange rules. Use thisprogram when coverageor contributions aredetermined by anemployee�s salary as ofthe first of a month ora specified date. Formore information, see"Updating Automaticallyfor Age, Salary, or Yearsof Service" on page 256

Salary changes are changes made to the employee�s job code, FTE(Full-Time Equivalent), rate of pay, step, grade, schedule, salary class,or benefit salaries 1 through 5.

� The employee�s pay frequency changes.

To determine the date the change affects an employee�s benefits, theapplication uses the date defined in the change rules. The application stopsthe employee�s benefit the day before the date defined in the change rules,and re-adds the benefit with a start date equal to the calculated effective date.

For flex benefits, if an employee switches between groups used as eligibilitycriteria for flex credit calculations, or if the salary used for flex credit calculationchanges, the Benefits Administration application does the following:

� Stops the employee�s benefits under the flex plan

� Stops the employee�s flex credit record

� Adds a new flex credit record for the employee based on the employee�snew employee group or new salary

� Re-adds the employee�s flex benefits with the same elections



249

What Happens When I Add Benefits Using Automation Rules?The Benefits Administration application uses Add Rules to calculate eachemployee�s eligibility date and, if appropriate, to enroll employees in a planor flex plan. Employees are enrolled in default benefit plans only in thefollowing situations:

� The employee is added to an employee group used for eligibility criteriawhen you defined the plan

� The employee�s benefit postal code changes to match one in the plan�spostal code table

NOTE You can use AddRules for new hires.

If an add rule exists for the personnel action, the application calculates thestart date for a benefit using the From Date, Months, Days, Hours, PayClass, and Entry Type information defined in the add rules. If no add ruleexists, the application lists, but does not enroll, employees who have becomeeligible to enroll in the benefit.

The Benefits Administration application uses the benefit process ordersdefined to determine the order in which an employee is enrolled in benefitplans.

Benefits are added for default plans based on the rules defined for eachplan. Those rules are:

Always default An employee is enrolled in the planif he or she is eligible

By plan type An employee is enrolled in the plan ifthe employee has no other benefitsof this type (for example, no otherhealth plan)

By plan category An employee is enrolled in the plan ifthe employee has no other benefitsfrom this category (for example, noother �medical� health plan)

Do not default An employee is not enrolled in theplan but is listed as being eligible forthe plan

For flex benefits, if an employee is added to the employee group used for aflex plan�s eligibility, the application

� Adds a flex credit record for the employee based on the employee�s newemployee group

-and-

� Adds default benefits under the flex plan for the employee




Procedures in this ChapterYou use the following procedures to change, add, or delete employeebenefits plans.

Holding or Deleting BenefitChange Records

This procedure displays thosechanges that the Employee BenefitUpdate uses to determine whichbenefits are updated. You canidentify those employees for whomyou do not want to process thechange.

Updating Automatically Based onBenefit Automation Rules

Use this procedure to add, change,and terminate employee benefitsbased on changes made bypersonnel actions.

Updating Automatically for Age,Salary, or Years of Service

This procedure updates employeebenefits for a plan that has coverageor contributions based on age,salary, or years of service.

Stopping EE Benefits Use to stop an employee�s benefit.

Changing Manually EE Benefits Use to manually change employee�scoverage or contribution in a benefitplan.

Changing Flexible SpendingAccount

Use to change flexible spendingaccount information.

Changing Flex Credits Use to add flex credits foran employee. You can alsouse this procedure to overrideapplication-calculated flex credits orannual salary.

Changing Dependent Benefits Use to change an employee�sdependent benefits.

Holding or Deleting Benefit Change RecordsThis procedure displays changes that the Employee Benefit Update (BN100)form uses to determine which benefits are updated. You can prevent BN100from processing a change by holding or deleting the benefit change auditrecord. If you place a change on hold, BN100 will not process that recorduntil you release it from hold. Deleting a benefit audit record will not impactthe original change to the employee. It prevents the employee�s benefitsfrom being updated for that change.


251



STEPS To hold or delete benefit change records1. Access Benefit Change Audit (BN35.1).

Figure 50. Form clip: Using BN35.1 to hold or delete benefit change records

2. Select the company from the Company field.3. Select the employee from the Employee field.4. If you want to view only those changes on hold, select Yes on the Hold Flag

field. If you want to display only changes not on hold, select No. Leave thisfield blank to display all records.

5. If you want to display changes on or after a specific date, type that date.The application will display on those changes based on the effective dateof the personnel actions.

6. Choose the Inquire function.7. Select the line action needed on the appropriate line.

If Then

Placing a change on hold Select the Change line functionand select Yes in the Hold field.

If you leave the Hold field blank,it defaults to No. If you selectYes, BN100 will not process thischange until it is release from holdstatus.

Removing a change from hold Select the Change line functionand select No in the hold field.

Deleting a change Select the Delete line function.

8. Choose the Change function.



Updating Automatically Based on Benefit Automation RulesThis procedure outlines the tasks to automatically add, change, and terminateemployee benefits based on changes made by personnel actions. EmployeeChange Benefit Update (BN100) uses the benefit change audit records fromBenefit Change Audit (BN35.1) and the automation rules defined to determinewhich benefits to update. If a change affects a benefit but no automation rulesare defined, the update program lists the benefit with an error message andwill not update the benefit.

Some employee changes appear on BN35.1 but will not trigger an update tothe employee�s benefits. Those changes include changes to an employee�sbirthdate, age, date used to calculate years of service (such as hire date oradjusted hire date), or smoker status. In addition, the application will notupdate employee benefits if the salary used for the coverage calculation wasoverridden on benefit entry.

NOTE When you usepersonnel actions andemployee groups, youneed to set the updatebenefits indicator to Yes.If the indicator is set toNo, change records arenot created.

Individual Action (PA52.1-5) and Action Update (PA100) from the PersonnelAdministration application are used when you use the Employee ChangeBenefit Update (BN100).

IMPORTANT An employee must have benefits history for BN100 to considerchanges to the employee. BN100 will not update new employees oremployees newly eligible for benefits.





� "What Happens when I Stop Benefits Using Automation Rules?"on page 248

� "What Happens when I Change Benefits Using AutomationRules?" on page 249

� "What Happens When I Add Benefits Using Automation Rules?"on page 250

STEPS To update automatically based on benefit automation rules1. Access Employee Change Benefit Update (BN100).


253

Figure 51. Form clip: Using BN100 to update benefit automation rules


you identify a batch job by providing additional information.4. Complete the form. Consider the following fields.

Thru Date If you want to select those benefit change auditrecords with effective dates equal to or earlierthan a specific date, type the specified date.

Processing Group If you want to update only a particular processinggroup, select the processing group.


Process Level If you want to update only a particular processlevel, select the process level.


Employee Group If you want to update only a particular employeegroup, select the employee group.

NOTE If you select an employee group, leavethe Processing Group and Process Level fieldsblank.



CreateDependents

Select either Yes or No to indicate whether youwant to add dependent benefits for benefits thatare automatically added.

BN100 calculates stop dates for non-spousedependents when it adds the benefit based on thestudent and dependent ages defined for the plan.

If a dependent�s age exceeds the dependent orstudent ages defined for the benefit plan, BN100does not add coverage for the dependent.

Create Investment Select either Yes or No to indicate whether youwant to add investment account distributions forautomatically added defined contribution benefits.

All of the investment distribution will go into thedefault investment account defined on BenefitPlan (BN15.1).

Report Sequence Select if you want the report sorted by employee,process level and department.

EmployeeSequence

If you select employee in the Report Sequencefield, select how you want employees sorted:either alphanumeric (employee name) or numeric(employee number).


If you select Report Only, the application liststhe benefits that are impacted by the benefitaudit change records being processed. Errormessages will display by any benefits that will notbe updated so you can review them and makecorrections as needed.

If you select Update, the application updatesemployee benefits based on the benefit changeaudit records and the benefit automation rulesdefined. The report includes all updated benefitsand deductions, as well as benefits affected bybenefit change audit records that are not updatedbecause no automation rule exists. Benefitchange audit records used by the program aredeleted.

Lawson recommends that you run the report asReport Only, review for accuracy, and then run inUpdate mode.



255

Related Reports and InquiriesTo UseDisplay plans an employee isenrolled









List employees current benefits Employee Benefit Report (BN231)

Run a statement of an employee�scurrent benefits


Updating Automatically for Age, Salary, or Years of ServiceThis procedure updates employee benefits for a plan that has coverage orcontributions based on age or years of service. This procedure also updatesbenefits for benefit plans that use As of Date or First of Month to determinesalary or update salary changes.

You can update employee, COBRA participant, and retiree benefits.

IMPORTANT If you are updating COBRA participants, update their benefitsbefore the invoice period in which the changes are effective.

TIP If a benefit isbased on an As ofDate, update employeebenefits before thatdate. If a benefit isbased on the first ofthe month, updateemployee benefitsbefore the first of eachmonth.




STEPS To update automatically for age, salary, or years of service1. Access Plan Employee Update (BN102).



Figure 52. Form clip: Using BN102 to update employee plan

2. Type the name of the job in the Job Name field.3. Type a job description in the Job Description field. The job description

provides additional information to help you identify the job.4. Complete the information in the Parameters section. Consider the following

fields.


Flex Plan If you want to update benefits under a flex planselect the flex plan.

Plan Type Select the plan type for which you want to updatebenefits.

Plan Select the benefit plan you want to update andassociate with the plan type you selected in theprevious field.

If you leave this field blank, the report or updateincludes all plans of the plan type you selected.

Processing Group If you want to update only employees ina particular processing group, select theprocessing group.


Process Level If you want to update only employees in aparticular process level, select the process level.



257

Employee Group If you want to update only employees in aparticular employee group, select the employeegroup.

NOTE If you select an employee group, leavethe Processing Group and Process Level fieldsblank.

Thru Date Type the date through which you want to updatebenefits.

Age, YOS, Salary Select either Yes or No to indicate if you want toupdate benefits based on age, years of service(YOS), or salary, in the Age, YOS, Salary fields.

You can select Yes for only one of these at a time.

Print deduction Select either Yes or No to indicate if you want toprint the updated deductions on the report. If youleave the field blank it defaults to Yes.

NOTE If you run the job as Report Only, newdeductions will not be printed since benefit arenot actually updated.

Report Sequence Select if you want the report sorted by employeeor process level and department.

EmployeeSequence

If you select employee in the Report Sequencefield, select how you want employees sorted:either alphanumeric (employee name) or numeric(employee number).


If you select Report Only the application liststhose benefits needing updating.

If you select Update, the application updatesbenefits and lists the updated benefits anddeductions if designated.

IMPORTANT First run this form in Report Onlyto review employee flex credits. Then run thisreport in Update.
















Stopping EE BenefitsThis procedure outlines the tasks to stop an employee�s benefit. To stop anemployee�s benefit, you must enter a stop date for the benefit. This leaves anaudit trail of past benefit enrollments. If you need to delete a benefit insteadof stopping it, you don�t need to enter a date. Deleting a benefit leaves noaudit trail that an employee was ever enrolled. A situation where you wouldwant to delete, rather than stopping an employee�s benefit, is if the employeewas enrolled in the wrong benefit.

IMPORTANT You cannot delete an employee benefit if payroll history existsfor the benefit�s deductions. If deduction history exists you need to stop,rather than delete, the benefit.

You can determine which benefits display by specifying a date. Plans do notdisplay that have a stop date before the specified date.

When you stop an employee�s benefit, the Benefits Administration applicationstops deductions for the employee in Employee Deduction (PR14.1). If youstop a benefit plan under a flex plan, the application creates or updates thestandard time record if one exists for the employee in Standard Time Record(PR30.1). If you re-add the benefit, the application creates new deductions forthe employee in PR14.1, and creates a standard time record in PR30.1, ifapplicable.


259





STEPS To stop an EE benefits1. Access Employee Benefit Changes (BN32.1).

Figure 53. Form clip: Using BN32.1 to stop an employee�s benefits

2. Select the company from the Company field.3. Select the employee from the Employee field.4. Type the date you want to use to determine which benefits you want to

display in the As of date field. Plans do not appear that have a stop datebefore this date. If you leave this field blank, the current system date de-faults.

5. If you want to limit which plans appear on the form, select the plan type inthe Plan Type field. Leave Plan Type blank to display all plans.

6. Choose the Inquire function.NOTE You can selectDelete in the lineaction to delete abenefit. However, if theemployee benefit hasany payroll history forthe benefit�s deductions,you cannot delete thebenefit.

7. Select Stop in the line action on the appropriate line.8. Enter the stop date for the benefit. You can enter a future date if you want

to.9. Select the Change button.

Manually Changing EE BenefitsThis procedure outlines the tasks to manually change an employee�s benefit.You can determine which benefits display by specifying a date. Plans do notdisplay that have a stop date before the specified date.



If an employee�s coverage or contributions change, you do not need to changethe employee�s current benefit. Instead, stop the current benefit and re-enterthe employee in the same plan with the new coverage and contributions. Thisprovides an online audit trail of changes and maintains historical information.

WARNING Do not attemptto add, change, or stopa benefit deduction usingEmployee Deduction(PR14.1). You updateall benefit deductions byupdating the associatedbenefit enrollment.







STEPS To manually change EE benefits1. Access Employee Benefit Changes (BN32.1).2. Select the company from the Company field.3. Select the employee from the Employee field.4. Type the date you want to use to determine which benefits you want to

display in the As of date field. Plans do not appear that have a stop datebefore this date.

5. If you want to limit the plans that appear on the form, select the plans inthe Plan Type fields. Leave these fields blank to display all benefits.

6. Choose the Inquire function.7. Choose the Add button at the end of the appropriate detail line for the ben-

efit you are changing. Benefit Add (BN32.3) opens.8. Type the new start date in the Start Date field.9. Type the new coverage and contribution information for the plan.10. Choose the Ok function. BN32.3 closes and the prior benefit is stopped on

the day before the start date of the new benefit.

If you want to view your recent changes, choose the Inquire function.

If the As of Date is equal to or later than the start date of the new benefit,the stopped benefit will not display.


261

Options for Changing Manually EE BenefitsIf you want to override what the application calculates, use Employee BenefitDetail Changes (BN32.2)

The following options are available from the Employee Benefit Changes(BN32.1).

Choose the Dept button to access Dependents (HR13.2). Use this formto change employee dependent information. See "Enrolling Dependents"on page 240 for more information.

Choose the Inv button to access Investment (BN36.1). Use this form toassign investment distributions for an employee�s contributions to a definedcontribution plan. If you re-enroll an employee in a defined contributionplan because the employee�s contributions change, you need to re-assigninvestment distributions.

Choose the Benef button to access Beneficiaries (BN47.1). Use this formto assign beneficiaries to a plan. See "Assigning Beneficiaries to a Plan"on page 241 for more information.

Choose the SB Benef button to access Saving Bond Beneficiaries (BN48.1).Use this form to assign saving bond beneficiaries. See "Assigning SavingsBond Beneficiaries" on page 241 for more information.













Changing Flexible Spending AccountsThis procedure outlines those tasks to change a flexible spending account.






STEPS To change flexible spending account1. Access Employee Benefit Changes (BN32.1).2. Select the company from the Company field.3. Select the employee from the Employee field.4. Type the date you want to use to determine which benefits you want to


5. If you want to limit which plans appear on the form, select the plan typesin the Plan Type fields.

6. Choose the Inquire function.7. Select the Change line function8. Delete the information in fields Opt, Sal Annual and PT.9. Choose the Change function. The application populates the Opt, Sal An-

nual and PT fields based on the contribution history.10. Select Stop in the line action on the appropriate line.11. Type the Stop date.12. Choose Change function.13. Choose the Add button. Benefit Add (BN32.3) opens.14. Complete the form. Type the number of times the new deduction amount

will be taken for the remaining plan year in the Opt field and enter the newper pay period or prorated annual amount

15. Choose Ok.











263

To UseList employees current benefits Employee Benefit Report (BN231)



Changing Flex CreditsThis procedure outlines the tasks to change flex credits for an employee.If you used Flex Credit Calculations (BN145) to create flex credits, youcan use this procedure to override the application-calculated flex credits orannual salary.

Lawson recommends that you process changes to flex credits by stopping thecurrent flex credit record and adding a new record with a new effective date.This maintains your audit trail of changes. You can change the information onan existing flex credit record if you do not reduce the employee�s total flexcredits below what they are spending on benefits.

STOP Before you stop a flex credit record for an employee, you must firststop all the benefits associated with the flex plan.



� " BN Enrollment: Enrolling Employees in Flex Plans" on page 211




STEPS To change flex credits1. Access Employee Flex Credits (BN45.1).2. Select a company from the Company field.3. Select the employee form the Employee field.4. Type the employee�s flex credit record start date in the Start Date field. An

employee can have more than one flex credit record for a flex plan year.If an employee�s has more than one flex credit record, the dates cannotoverlap.

5. Select a flex plan in the Flex Plan field. The plan you select determines thecredits the employee receives and the benefit plans for which the employeeis eligible.

6. If you are stopping the flex credit record, type the new stop date. If you willbe adding a new record with new information, the stop date should be oneday prior to the start date to be used on the new record.

7. If you want to override the annual salary flex credits are based on, type thenew salary in the Annual Salary field.

8. If you want to override any of the credits an employee receives based oneither years of service, age, dependents, or lifestyle, type the new numberin the appropriate field.

Credits are added to the total flex credits available for the employee tobuy benefits.

9. If you want to override the pretax dollars as defined on Flex Credits(BN08.1), type the new pretax dollars amount.

10. Choose the Change function.














265

Changing Dependent BenefitsThis procedure outlines those tasks to change an employee�s dependentbenefits.

STEPS To change dependent benefits1. Access Employee Benefit Changes (BN32.1).2. Select the company from the Company field.3. Select the employee from the Employee field.4. Type the date you want to use to determine which benefits you want to


5. If you want to limit which plans appear on the form, select the plans in thePlan Type field.

6. Choose the Inquire function.7. Choose the Dep button on the line for the benefit plan for which you want

to make the change.8. For plans in which a dependent is already enrolled, two detail lines will

display. If you are stopping the benefit, type the stop date on the line forthe current enrollment. If you need to re-add the benefit at a later date, usethe second detail line for the plan to maintain historical data.

9. Choose Change function.















Chapter 15

BN Enrollment: COBRAThis chapter focuses on the procedures needed to process COBRA benefits.

STOP You must set up occurrence types, notification days, and invoicebilling periods for COBRA Participants in Benefits Company (BN00) beforeprocessing COBRA participants. For more information, see " Setup: BNCompany" on page 33.

Benefits Administration User Guide Chapter 15 BN Enrollment: COBRA 267



BNProcesses

MaintainingBN Plans

PlanMaintenance

Flex Plans

Employees

BN PlanEnrollment

BN Company

Preliminaries

Setup

Flex Plan

BN-Plans

BNAutomation

Rules

MaintainEmployee

Enrollments


SavingsBond

Update

Benefit PlanTesting


SpecialProcessing


BN-PlanCoverage



Retirees

You Are Here

BN EntryRules

268 Chapter 15 BN Enrollment: COBRA Benefits Administration User Guide

Concept in this Chapter

Who is a COBRA participant?A COBRA participant is an employee or an employee�s dependent that iscontinuing the group health and welfare coverage under the provisions of theConsolidated Omnibus Budget Reconciliation Act (COBRA) after divorce,separation, death, termination, reduction in working hours, or failure of thedependent to meet the plan definition of dependent. This type of participantis only valid in the United States.


Procedures in this ChapterThe following procedures enable you to process COBRA benefits.

Defining a COBRA participant Use this procedure to create theparticipant record.

Enrolling a COBRA Participant Use this procedure to enroll aCOBRA participant.

Changing COBRA ParticipantBenefits

Use this procedure to changeCOBRA participant benefits.

Adding a Second Occurrence orTracking COBRA Dates

Use this procedure to add a secondoccurrence or track COBRA dates.

Notifying or Terminating COBRARights

Use this procedure to notify orterminate COBRA rights.

Generating COBRA NotificationLetters

Use this procedure to generateCOBRA letters.

Canceling COBRA Coverage forDelinquent Payments

Use this procedure to cancel COBRAcoverage for delinquent payments.

Defining a COBRA ParticipantYou can create a COBRA participant record or add an employee or dependentas a COBRA participant. If you add an employee or dependent as aCOBRA participant, you only need to define the participant�s occurrence andoccurrence date. The other information (address, social number, birth date,and so on) defaults from the Human Resources application.

If you want to automatically define a COBRA participant record throughautomation rules, see " Setup: Automation Rules" on page 195.

You can also create COBRA participant records through personnel actions.For more information on personnel actions, see the Personnel AdministrationUser Guide.


� "Who is a COBRA participant?" on page 269

STEPS To define a COBRA participant1. Access COBRA Participant (BN70.1).


Figure 54. Form clip: Using BN70.1 to define a COBRA participant


Participant Type the COBRA participant�s number if adding aparticipant. Select a COBRA participant numberif inquiring.

NOTE Assign COBRA participant numbers or letthe application assign them based on parametersin COBRA Parameters (BN00.2). If the AutoNumbering field is Yes, leave this field blank.

Employee If you are adding an employee or an employee�sdependent as a COBRA participant, select theemployee. If you want to add an employee asa COBRA participant, you only need to definethe employee�s occurrence and occurrence date.The other information (including address, socialnumber, birthdate, and so on) defaults fromEmployee (HR11.1).

NOTE A COBRA participant must have anemployee number to add a spending accountbenefit.

Dependent If the COBRA participant you are adding is adependent with a record in Dependent (HR13.1),select the dependent.

If you want to add a dependent as a COBRAparticipant, you only need to define thedependent�s occurrence and occurrence date.The other information (including address, socialnumber, birthdate, and so on) defaults fromDependent (HR13.1).


Occurrence Type Select the occurrence that resulted in theperson�s COBRA eligibility. This is a requiredfield.

Occurrence types determine the maximum lengthof time a participant may extend coverage basedon the data defined on COBRA OccurrenceTypes (BN00.3).

Occurrence Date Type the date of the occurrence. This is arequired field. The date becomes the defaultstart date for the COBRA participant�s benefits;the application uses this date to calculate theCOBRA participant�s Termination Date.

If you used a personnel action to create theparticipant�s record, this date is the effective dateof the personnel action. If you used EmployeeBenefit Change (BN100), this date is the benefitstop date.

Company Notified Type the date the COBRA participant notified thecompany of a qualifying event.

IMPORTANT If the difference between theOccurrence Date and the Company Notified Dateis more than the number of Notification Daysdefined on COBRA Parameters (BN00.2), theparticipant cannot enroll in the benefits.


Related Reports and InquiriesTo UseList COBRA participants COBRA Participant Listing (BN270)

Enrolling a COBRA ParticipantThe COBRA participant benefit entry form displays all plans for which aCOBRA participant is eligible. If the COBRA participant is currently enrolled inbenefits, those benefits display first, followed by all plans.

STOP The COBRA Participants Covered field in the Eligible form tab ofBenefit Plan (BN15.1) must be Yes for COBRA participants to enroll in a plan.For more information, see "Defining a Primary Benefit Plan" on page 95.


STEPS To enroll COBRA participants1. Access COBRA Benefit Entry (BN71.1).

Figure 55. Form clip: Using BN71.1 to enroll COBRA participants

TIP Use the DrillAround feature tosee which plans theemployee was enrolled.

2. After selecting the Company, Participant, and typing the As of Date, choosethe Inquire form function. The form displays all plans for which the COBRAparticipant is eligible. If the COBRA participant is currently enrolled in abenefit, that benefit displays first, followed by all plans according to plancode.


Start Type the date that benefit coverage begins forthe COBRA participant. If you leave this fieldblank, the As of Date defaults.

NOTE The benefit start date determines whenpremium invoicing begins for the COBRAparticipant. When Invoice Edit (BN180) is run fora period which includes this date, an invoice iscreated for the COBRA participant.

Stop Type a stop date to stop the COBRA participant�scoverage. Premium invoicing stops after thisdate. If you leave this field blank, the stopdate defaults from the Termination Date field inCOBRA Participant (BN70.1).

Opt If the Coverage Type field in Benefit Plan(BN15.1) is Coverage Options for this plan, selectthe coverage option the COBRA participantelected.


Monthly If the plan�s Contribution Type in BN15.1 isContribution Limits and the COBRA participantspecifies a monthly contribution, type the monthlyamount. The application calculates the totalannual contribution by multiplying the monthlyamount by the number in the Opt field.

Annual If the plan�s Contribution Type in Benefit Plan(BN15.1) is Contribution Limits and the COBRAparticipant specifies an annual contribution, typethe COBRA participant�s total annual amountcontribution.

Coverage Use this field for plans that offer coverage as anamount.


Options from COBRA Benefit EntryThe following options are available from COBRA Benefit Entry (BN71.1).

Choose the Comments button to open the Comments subform.

Choose the Dep button to open the dependent Benefits subform and track aCOBRA participant�s dependents covered under the COBRA participant�sbenefits. The subform is not available when:

� the COBRA participant�s record on COBRA Participant (BN70.1) is not as-sociated with an employee record

� the Covered Dependent fields on Benefits Company (BN00.1) is No for thistype of plan

� the plan or the participant�s coverage option does not cover dependents

� the participant has no dependents on Dependents (HR13.1).

Related Reports and InquiriesTo UseDisplay COBRA participant benefits COBRA, Retiree Benefit Inquiry

(BN77.1)

List COBRA participant benefits COBRA and Retiree Benefit Report(BN233)

Changing COBRA Participant BenefitsIf a COBRA participant�s coverage or contributions change, Lawsonrecommends that you do not change the COBRA participant�s benefit. Rather,stop the current benefit and re-add the COBRA participant in the same planwith the new coverage or contributions. Re-adding the benefit provides anonline audit trail of changes.


The COBRA participant�s benefit and invoicing will stop on the stop dateentered. If you are entering a past date and invoices have already beencreated, enter any needed adjustments on Cash Entry (BN81.1). For moreinformation, see "Entering and Manually Applying Payments" on page 343.

IMPORTANT You automatically update COBRA participant benefits when aplan changes. For more information, see " Plan Maintenance: Benefit Plans"on page 287. You automatically update COBRA participant benefits forbenefits based on age. For more information, see " BN Enrollment: MaintainEmployee Enrollments" on page 243.

STEPS To change COBRA participant benefits1. Access COBRA Benefit Entry (BN71.1).2. After selecting the Company, Participant, and typing the As of Date, choose

the Inquire form function. Plans in which the COBRA participant is enrolledwill display on two separate lines. One is denoted with an asterisk (*) toindicate enrollment. The other line is there to enter changes.

NOTE Stop dates areautomatically calculatedfor participants basedon Occurrence Typeand Occurrence Dateon COBRA Participant(BN70.1). You cannotenter a stop date laterthan the system-calculated date.

3. In the Stop field, change the date to stop the COBRA participant�s cover-age. The COBRA participant�s benefit and invoicing will stop on that date.If the participant has dependents covered under the benefit, the BenefitsAdministration application stops the dependent benefits.

4. Choose the Change form function.5. Add the benefit with new coverage and contribution for the COBRA partic-

ipant and the COBRA participant�s dependents.6. Choose the Change form function.

Related Reports and InquiriesTo UseDisplay COBRA participant benefits COBRA, Retiree Benefit Inquiry

(BN77.1)

List COBRA participant benefits COBRA and Retiree Benefit Report(BN233)

Adding a Second Occurrence or Tracking COBRA DatesIf a COBRA participant who is already defined on COBRA Participant(BN70.1), has benefits, and experiences another qualifying event, definethe second occurrence and change the stop date of each of the COBRAparticipant�s benefits. Or use BN70.1 to view and update COBRA-relateddates.


STEPS To add a second occurrence or track COBRA dates1. Access Participant Dates (BN70.2).2. Select the Company and Participant and choose the Inquire form function.3. In the Notification Dates section, consider the following fields.

ParticipantNotified

When you Add, leave this field blank. If this fieldis blank, COBRA Letters (BN171) creates aninitial notification letter for the COBRA participantand updates this field with the date of the letter.

DelinquentPremium

Type the last date the company notified theCOBRA participant of delinquent premiumpayments. If COBRA Letters (BN171) createsa delinquent premium letter for the COBRAparticipant, BN171 updates this field with theletter date.

4. From the Coverage Terminated section, consider the following fields.

Premium Default Type the date coverage was canceled becausethe COBRA participant defaulted on premiumpayments.

DeclinedCoverage

Type the date the COBRA participant declined anextension of coverage. If you type a date in thisfield, this date defaults as the Termination datefield in COBRA Participant (BN70.1).

MedicareCoverage

Type the date the COBRA participant is coveredunder Medicare. This date defaults as theTermination date field in COBRA Participant(BN70.1).

5. From the Occurrence 2 section, Consider the following fields.

Occurrence Type If the COBRA participant has a secondoccurrence, select the second occurrence.

Date Type the date of the second occurrence.

Date Notified Type the date that the COBRA participant gavenotice of the second occurrence.

6. Choose the Change form function. If you have added a second occurrence,the Benefits Administration application recalculates the Cobra Participant�stermination date to include the maximum months allowed for multiple oc-currences.

7. Access COBRA Benefit Entry (BN71.1) and inquire on the COBRA partic-ipant�s benefits.

8. Clear the Stop Date field and choose the Change form function. The ter-mination date is recalculated.


Notifying or Terminating COBRA RightsList COBRA participants who have not been notified of their right to extendcoverage or terminate an individual�s rights to COBRA coverage if theindividual has not responded to his or her notification letter.

If you run the report to list COBRA participants who have not been notified oftheir rights, the report lists COBRA participants whose Participant Notifiedfield in Participant Dates (BN70.2) is blank.

If you run the report to terminate rights to COBRA coverage, the BenefitsAdministration application uses the Company Notified field in ParticipantDates (BN70.2) to determine if the individual has exceeded the maximumnumber of allowed notification days, which is defined in the Election field inCOBRA Parameters (BN00.2). If the difference between the Occurrence Dateand Company Notified fields in COBRA Participant (BN70.1) is greater thanthe maximum number of allowed notification days, the COBRA participant�sTermination Date becomes the same date as the COBRA participant�soccurrence date.

STEPS To determine notification or terminate COBRA rights1. Access COBRA Notification Report (BN170).2. In the Parameters section, select the company. This is a required field.3. In the Report Option field, select the COBRA participants for whom the

report is being run. This is a required field.4. In the Update field, select the action you want to perform. This is a re-

quired field. The Update option is valid only when the Report Option is NoResponse. If you select Update, the application cancels the right to extendcoverage for any COBRA participant who has not notified the company oftheir benefit election. The COBRA participant�s termination date becomesthe same date as the COBRA participant�s occurrence date.

Generating COBRA Notification LettersYou can create letters to notify new COBRA participants of their right to extendbenefit coverage, or create letters for COBRA participants with late payments.

Cobra Letter Print (BN171) creates initial notification letters for COBRAparticipants whose Participant Notified field on Participant Dates (BN70.2) isblank. BN171 uses the letter corresponding to each participant�s Occurrencetype as defined on COBRA Occurrence Types (BN00.3) and updates the fieldwith the date of the letter.

If you run the report to create letters for COBRA participants with latepayments, BN171 uses the delinquent premium letter selected in COBRAParameters (BN00.2). When the report creates delinquent premium letters,the Letter Date field updates to the Delinquent Premium field in ParticipantDates (BN70.2).


STEPS To generate COBRA notification letters1. Access COBRA Letter Print (BN171).2. From the Parameters section, Consider the following fields.

Report Selection Select the kind of letter you want to print. Thisis a required field.

If you select All Notification Letters, BN171creates notification letters for COBRA participantswith occurrences. If you select Specified Letter,BN171 creates the letter you select in the Letterfield for COBRA participants who have theoccurrence associated with the letter in COBRAOccurrence Types (BN00.3). If you selectDelinquent Premium Letters, BN171 createsletters for COBRA participants with delinquentpremium letters.

Report Option Select the value that indicates whether you wantto print letters, labels, both letters and labels, orlabels and a letter form. This is a required field.

Letter Date Type the date of the letter. This is a required field.This date defaults to the Company Notified field inParticipant Dates (BN70.2) for initial notificationletters. For delinquent premium letters, thisdate defaults to the Delinquent Premium field inParticipant Dates (BN70.2).

Update Select the report you want. This is a requiredfield. Lawson recommends that you selectReport Only to review the letters before selectingUpdate.

3. Choose the Add form function.4. Submit the report.

Options for Creating LettersThe following options are available for generating COBRA notification letters.

To create a free-form or custom letter for a participant, use Free Form Letter(BN85.1). To print a free-form letter, use Standard Letter Print (BN285).Change notification dates manually on Participant Dates (BN70.2) whenyou use this option.

Canceling COBRA Coverage for Delinquent PaymentsCancel coverage for COBRA participants who have not remitted payments fortheir premiums in the grace period defined on Benefits Company (BN00.1) orthe initial grace period defined on COBRA Parameters (BN00.2).


STEPS To cancel COBRA coverage for delinquent payments1. Access Outstanding Invoice Listing (BN175).2. From the Parameters section, Consider the following fields.

Report Option Select the group for which the report is being run.This is a required field.

Update Select the action you want to perform. Lawsonrecommends that you select Report Only toreview the report before selecting Update.



Chapter 16

BN Enrollment: RetireeThis chapter focuses on procedures needed to handle Retiree benefits..



BNProcesses

MaintainingBN Plans

PlanMaintenance

Flex Plans

Employees

BN PlanEnrollment

BN Company

Preliminaries

Setup

Flex Plan

BN-Plans

BNAutomation

Rules

MaintainEmployee

Enrollments


SavingsBond

Update

Benefit PlanTesting


SpecialProcessing


BN-PlanCoverage



Retirees

You Are Here

BN EntryRules

Benefits Administration User Guide Chapter 16 BN Enrollment: Retiree 281

Concept in this Chapter

Who is a Retiree?A retiree is a former employee who no longer has deductions takenfor benefits but does receive an invoice for premiums or is tracked forcompany-provided benefits to accrue the company liability.

If your organization is going to continue paying a retiree using Lawson Payroll,there is no need to define retirees or retiree coverage. Retirees would enrollin the same manner as regular employees but with different coverage orcontribution information defined as needed for the plan.

282 Chapter 16 BN Enrollment: Retiree Benefits Administration User Guide

Procedures in this ChapterThe following procedures enable you to process Retiree benefits.

Enrolling Retirees Use this procedure to enroll a retireein your benefit plans.

Changing Retiree Benefits Use this procedure to change aretiree�s benefits.

Canceling Coverage forDelinquent Payments

Use this procedure to cancelcoverage for delinquent payments.

Enrolling RetireesNOTE Retiree benefitsare entered andmaintained on one form.

Enroll a retiree in benefit plans. The Retiree Benefit Entry form displays allplans for which the retiree is eligible. If the retiree is currently enrolled in abenefit, that benefit displays first, followed by all plans.

STOP For retirees to enroll in a plan, the Retirees Covered field in theEligible form tab of Benefit Plan (BN15.1) must be Yes. In addition, retireesmust be in the Retirees Employee Group, if one was selected, in Benefit Plan(BN15.1) to be eligible for a plan. For more information, see "Defining aPrimary Benefit Plan" on page 95.


� "Who is a Retiree?" on page 282


STEPS To enroll retirees1. Access Retiree Benefit Entry (BN72.1).

Figure 56. Form clip: Using BN72.1 to enroll retirees

NOTE The select list forthe Retiree field includesall employees becauseretiree records are inEmployee (HR11).Defining an employeegroup for retirees andentering it on theEligible tab of BenefitPlan (BN15) preventsan active employee frombeing enrolled in erroras a retiree.

2. After selecting the Company, Retiree, and typing the As of Date, choosethe Inquire form function. The form displays all plans for which the retiree iseligible. If the retiree is currently enrolled in a benefit, that benefit displaysfirst, followed by all plans according to plan code.


Start Type the date that benefit coverage begins forthe retiree. If you leave this field blank, the As ofdate defaults.

NOTE The benefit start date determines whenpremium invoicing begins for the retiree. WhenInvoice Edit (BN180) is run for a period whichincludes this date, an invoice is created for theretiree.

Stop Type a stop date to stop the retiree�s coverage.Premium invoicing stops after this date.

Opt If the Coverage Type field in Benefit Plan(BN15.1) is Coverage Options for this plan, selectthe coverage option the retiree wants.

Coverage Use this field for plans that offer coverage as anamount.


Options from Retiree Benefit EntryThe following options are available from Retiree Benefit Entry (BN72.1).

Choose the Comments button to open the Comments subform.


Choose the Dependents button to open the Dependent Benefits subform.Use the subform to track coverage dates for the retiree�s dependents. Thesubform is not available when:

� The Covered Dependents field in Company (BN00.1) is No for this type ofplan

� The plan or the retiree�s coverage does not cover dependents

� The retiree has no dependents in Dependents (HR13.1)

Related Reports and InquiriesTo UseList retiree benefits COBRA and Retiree Benefit Report

(BN233)

Display enrolled retiree benefits COBRA, Retiree Benefit Inquiry(BN77.1)

Changing Retiree BenefitsNOTE Retiree benefitsare entered andmaintained on one form.

If a retiree�s coverage changes, Lawson recommends that you do not changethe retiree�s benefit. Rather, stop the current benefit and re-add the retiree inthe same plan with the new coverage. Re-adding the benefit provides anonline audit trail of changes.

The retiree�s benefit and invoicing will stop on the stop date entered. If youare entering a past date and invoices have already been created, enter anyneeded adjustment in Cash Entry (BN81.1). For more information, see"Entering and Manually Applying Payments" on page 343.

IMPORTANT You automatically update retiree benefits when a plan�scoverage or contributions change. For more information, see " PlanMaintenance: Benefit Plans" on page 287. Automatically update retiree�sbenefits for benefits based on age. For more information, see " BNEnrollment: Maintain Employee Enrollments" on page 243.


STEPS To change a retiree�s benefits1. Access Retiree Benefit Entry (BN72.1).

TIP Use the DrillAround feature from theRetiree field to see aretiree�s benefits.

2. After selecting the Company, Retiree, and typing the As of Date, choosethe Inquire form function. The form displays all plans for which the retireeis eligible. Plans in which the retiree is enrolled will display on two separatelines. One line is denoted with an asterisk (*) to indicate enrollment; theother line is there to enter changes.

3. In the Stop field, type the date to stop the retiree�s coverage. The retiree�sbenefit and invoicing will stop on that date. If the retiree has dependentscovered under the benefit, the Benefits Administration application stops thedependent benefits.

4. Choose the Change form function.5. Add the benefit with new coverage and contribution for the retiree and the

retiree�s dependents.6. Choose the Change form function.

Related Reports and InquiriesTo UseDisplay retiree benefits COBRA, Retiree Benefit Inquiry

(BN77.1)

List retiree benefits COBRA and Retiree Benefit Report(BN233)

Canceling Coverage for Delinquent PaymentsCancel coverage for retirees who have not remitted payments for theirpremiums in the grace period defined on Benefits Company (BN00.1).

STEPS To cancel coverage for delinquent payments1. Access Outstanding Invoice Listing (BN175).2. From the Parameters section, Consider the following fields.

Report Option Select the group for which the report is being run.This is a required field.




Chapter 17

Plan Maintenance: Benefit PlansThis chapter focuses on procedures to update and maintain your company�sbenefit plans.



BNProcesses

MaintainingBN Plans

PlanMaintenance

Flex Plans

Employees

BN PlanEnrollment

BN Company

Preliminaries

Setup

Flex Plan

BN-Plans

BNAutomation

Rules

MaintainEmployee

Enrollments


SavingsBond

Update

Benefit PlanTesting


SpecialProcessing


BN-PlanCoverage



Retirees

You Are Here

BN EntryRules

Benefits Administration User Guide Chapter 17 Plan Maintenance: BenefitPlans

287



� "Why would I Change My Benefit Plans?" on page 288

� "How does Lawson Track Benefit Plan Changes?" on page 288

� "What Statuses Does Lawson Track?" on page 290

Why would I Change My Benefit Plans?Changes to employee benefit plans result from one of three kinds of changes.

� Changes that originate directly from an employee, such as a change infamily status or due to an increase in the employee�s age or years of ser-vice.

� Changes that result from changes in the employee�s work environment andfrequently originate from the company, including transfers or promotions.

� Changes that result from a change to the benefit plan.

The first two kinds of changes involve making changes to employee benefitinformation. The last change involves making changes to the plan, such asadding new coverage, contribution, company match percent, or generalledger override.

How does Lawson Track Benefit Plan Changes?The changes you can make to existing benefit plans include changes to entryrules, coverage, contributions, and general ledger overrides. You enter thesechanges by defining a new record with a new start date. This maintainshistorical information on the plan. If you change the current entry rule,coverage, contribution, or general ledger override record, rather than defininga new record, you lose the information that was originally defined. Whetheryou add a new record or change an existing record, all employees currentlyenrolled in the plan must be updated for changes to coverage, contribution,and general ledger override information. Changing or adding a new entry ruleto a plan will only impact future enrollment and re-enrollments for the plan.

To make a change to a benefit plan, add a new record or change the existingrecord. Update employees enrolled in the plan by running an update program.

You can change the frequency table for a benefit plan by attaching a newtable or by changing the table that is already attached. This type of changedoes not involve a new effective date, but employee benefit deductionsneed to be updated for the change.

A benefit plan can also be discontinued and all employee enrollments stopped.Through a mass termination you can create a data file that can be used to

288 Chapter 17 Plan Maintenance: Benefit Plans Benefits Administration User Guide

mass enroll employees in a new plan. This is useful when you are replacingan existing benefit plan and all enrollment should be transferred over.

When a benefit enrollment is updated for a new or changed coverage,contribution, or general ledger override, the application does the following:1. Stops the original benefit and deductions the day before the change is ef-

fective.2. Re-adds the benefit with the new amounts, deductions, and with a start

date equal to the effective date of the change.3. For benefits under a flex plan, the application will create or update standard

time records.

When a benefit enrollment is affected by a new frequency table, theapplication does the following:1. Changes the current benefit deduction amount and updates the deduction

cycles.2. For benefits under a flex plan, the application will update standard time

records.

Example 1Alden Tire Company has received a premium increase from their insurancecarrier for their group health plan. The new premiums take effect January1, 2000, so a new contribution record is defined for the plan dated January1, 2000 with the new rates. When employee enrollments are updated, thecurrent benefits are stopped on December 31, 1999 and a new benefit isadded with a start date of January 1, 2000.

Example 2Jones Piano has discovered that their disability plan was defined incorrectly.The coverage calculation was defined as 65% of an employee�s salary,when the correct calculation should be 70%. The current coverage record ischanged to reflect the correct percent. Employee enrollments are updatedand all current benefits are recalculated using the new percentage rate, butthe start date on the benefits remains unchanged.

Example 3RJ�s Shoes, Inc. has decided to change the way their benefit contributionsare deducted from payroll. Currently, benefit deductions are taken only onceeach mont. Starting June 1, 2000, RJ�s Shoes want deductions to be takenevery biweekly pay period. Before the first payroll of June, RJ�s Shoes definea new frequency table and attach the new table to all the benefit plans.Employee enrollments are updated prior to running the payroll cycle so thatall the benefit deductions are recalculated to the new biweekly amountswith the new deduction cycle designations. Benefits are not stopped andre-added with a new effective date, since only the benefit deductions areimpacted by the change.


289

What Statuses Does Lawson Track?The Benefits Administration application associates a status with eachcoverage, contribution, and general ledger override record. This status ismaintained behind the scenes in Lawson, and tells the application whenrecords need to be updated to employee enrollments. The different statusesare described in the table below.

Status Description

New Group, New Date Tells the application that a newrecord for an employee group notpreviously associated with a recordhas been defined.

Existing Group, New Date Tells the application that a newrecord for an employee group with aprevious record has been defined.

Change Existing Record Tells the application that an originalrecord has been changed.

Updated This is the desired status, tellingthe application that employeeenrollments have been updated.Records defined while there are noemployee enrollments in a plan willbe assigned this status.

Drill around to view these statuses or run a report. The Lawson Payrollapplication will not allow the earnings and deductions calculation program torun if there is a record dated on or before the payment date for the currentpayroll cycle that has a status other than Updated. This helps ensure that thebenefit deductions included in the payroll cycle are current and correct.

Frequency tables have one of two statuses, Updated or Not Updated, butare processed in a similar manner.


Procedures in this ChapterThe following procedures you use to update your benefit plans.

Updating Coverage Information Make changes to coverageinformation in a benefit plan.

Updating ContributionInformation

Change a benefit plan�s contribution.

Updating Frequency TableInformation

Update a frequency table attachedto a benefit.

Attaching a Different FrequencyTable

Attach a different frequency table toa benefit plan.

Updating GL Overrides Update general ledger overrides.

Viewing Records RequiringUpdating

Verify statuses of benefit plans.

Updating Enrollment for PlanChanges

Update all benefits for plans in whichcoverage, contributions, or generalledger overrides have been addedor changed.

Updating Enrollment forFrequency Table Changes

Update employee deductions whena frequency table changes or when adifferent frequency table is assignedto a benefit plan.

Terminating or Replacing aBenefit Plan

Terminate benefits under a benefitplan or a flex plan.

Deleting a Coverage Option froma Benefit Plan

Deletes a coverage option from abenefit plan.

Updating Coverage InformationUse this procedure when you want to make changes to coverage data in abenefit plan. For example, you have renewed a policy and you need to onlychange the coverage level.


291

STEPS To update coverage information1. Access Benefit Plan (BN15.1).2. Select the company, plan type and plan for which you want to change the

coverage information.3. Choose the Inquire function.4. Choose the Coverage button.

For more information on See

Coverage Options (BN17.1) "Defining Coverage Amounts" onpage 129

Coverage Amounts (BN17.3) "Defining Coverage Amounts" onpage 129

5. If the coverage you want to change is Coverage Options, choose the Cov-erage button on Coverage Options by Plan (BN17.1).

6. Type the date of the coverage record you want to change in the Start Datefield.

7. Choose the Inquire function.8. Type a new start date in the Start Date field.

If you are correcting information that was entered my mistake, do not typea new start date.

IMPORTANT If you have already gone through a pay period, type a newstart date.

9. Enter your new information into the appropriate fields.NOTE Depending onthe how the coveragewas defined, theapplication will promptyou to enter either newsalary or coveragelimits. See "DefiningCoverage SalaryParameters" on page135"Defining CoverageLimits" on page 140

10. Choose the Add function. If you did not enter a new start date chooseChange function.

Options for updating coverage informationChoose the Limits button if you want to update coverage limits. See "DefiningCoverage Limits" on page 140.

Updating Contribution InformationUse this procedure to change a plan�s contribution; for example, when thereare new premiums for the plan�s coming year.


STEPS To update contribution information1. Access Benefit Plan (BN15.1).2. Select the company, plan type and plan for which you want to change the

coverage information.3. Choose the Inquire function.4. Choose the Contribution button.

For more information on See

Options Amount "Defining Options Amount" onpage 165

Options Amount Range "Defining Options Amount Range"on page 170

Flat Contributions "Defining Flat Contributions" onpage 173

Salary or Coverage Rate Tables "Defining Salary or Coverage RateTable" on page 177

Contribution Limits "Defining Contribution Limits" onpage 180

Match Limits Schedules "Defining Match Limit Schedules"on page 186

Match Percent Schedules "Defining Match PercentSchedules" on page 190

5. Type the date of the contribution record you want to change in the StartDate field.

6. Choose the Inquire function.7. If benefit deductions have already been taken through payroll, type a new

start date in the Start Date field. If you are only correcting information thatwas entered by mistake, you do not need to type a new start date.

8. Enter your new information into the appropriate fields.9. Choose the Add function. If you did not enter a new start date choose the

Change function.

Updating Frequency Table InformationThis procedure outlines the tasks to change a frequency table�s information.


293

STEPS To update frequency table information1. Access Frequency Table (BN04.1).2. Select Company in the Company field.3. Select the code and the description that represents the frequency table in

the Table field.4. Choose the Inquire function

NOTE The number ofpay periods in a yearwill default in to this fieldfor each pay frequency.If you need a differentvalue, type that value inthe field.

5. Type the contribution divisor for your employees and select the deductioncycle.

IMPORTANT To add the frequency table, at least one cycle must be markedfor each pay frequency, even if that frequency does not apply to your company.


Attaching a Different Frequency TableThis procedure outlines the tasks to attach a different frequency table toa benefit plan.

STEPS To update frequency table information1. Access Benefit Plan (BN15.1)2. Select company, plan type, and plan.3. Choose the Inquire function.4. Select a different frequency table.5. Choose the Change function.

Updating GL OverridesThis procedure outlines the tasks to update general ledger overrides.

IMPORTANT Lawson recommends that you review Payroll general ledgerdefaulting before using this program.

The application uses the deductions and pay codes assigned to a plan todetermine which general ledger accounts are used to post transactions for theplan. You can override the general ledger accounts for the plan.

If you override general ledger accounts, the Lawson Payroll application usesthe general ledger accounts from this form when deductions are created inEmployee Deduction (PR14.1) or when standard time records are created inStandard Time Record (PR30.1).


STEPS To update GL overrides1. Access General Ledger Overrides (BN20.1).2. Select the company, plan type, and plan.3. Type the start date for the general ledger table.4. Choose the Inquire form function.5. Type the new start date.

If you are correcting information that was entered by mistake, do not typea new start date.

6. Change the distribution company, expense, and accrual accounts you wantto override. If you leave Exp CO or Exp Account Unit blank and select onlyan expense account, the Payroll application uses the normal defaultingdefined for distribution company accounting units.

7. Choose the Add form function. If you did not enter a new start date, Choosethe Change Function.

Viewing Records Requiring UpdatingThis procedure outlines the tasks to verify benefit plan statuses. You can runthis report for all records or only those needing updating. When the reportis run, the application checks for those plans needing updates because ofchanges in coverage, contribution, general ledger overrides, or frequencytable information.

This report helps you determine if you need to update enrollments forfrequency table changes or update enrollments for plan changes.

STEPS To view records requiring updating1. Access Benefit Plan Status Report (BN220).

TIP You can view thisinformation by drillingaround on the companynumber.


Company Select a company.

Date Range Enter the start and end date for the date range.

Report Option Select either T to display only those records inneed of updating or A to display all records.

3. Choose the Add function.4. Choose the Submit function.

Related Reports and InquiriesTo UseUpdate benefit plans Plan Update (BN105)

Update benefit plans due tofrequency table changes

Frequency Table Update (BN104)


295

Updating Enrollment for Plan ChangesThis procedure outlines the tasks to update all benefits for plans in whichcoverage, contributions, or general ledger overrides have been added orchanged. You can update employee, retiree benefits, and COBRA participant,though these must be updated separately. The update program can onlyupdate one plan change at a time. If you have made multiple changes to aplan, you will need to run the update multiple times.

IMPORTANT Use this procedure before the payroll cycle in which the newcoverage, contribution, or general ledger override records become effective.If you entered plan changes, the payroll earnings and deduction calculationprogram prompts you to update benefit enrollments and identifies the planand the record date in need of updating.


� "How does Lawson Track Benefit Plan Changes?" on page 288

� "What Statuses Does Lawson Track?" on page 290

STEPS To update enrollment for plan changes1. Access Plan Update (BN105).

Figure 57. Form clip: Using BN105 to update plan changes for enrollment


you identify a batch job by providing additional information.


TIP To determinewhich premium needs tobe updated, drill aroundon the Company fieldand select EmployeePremium Status. Benefitplans with a statusindicating a change hasbeen made should beincluded in the planupdate parameters.


Report Option Select whether you want to report on employees,COBRA participants, or retirees.

Thru Date Type the date you want to process plan changesthrough.

If you need to update benefits for multiplechanges to a plan, enter the date of the earliestchange first. After the update is complete, runthe program again using a thru date equal to thedate of the next effective change.

Print deduction Select either Yes or No to indicate whether youwant to print updated deductions on the report.

If you leave this field blank, it defaults to Yes.

Report Sequence Select how you want to sort the report, either byemployee and retiree or by process level anddepartment.

EmployeeSequence

If you select employee in the Report Sequencefield, select how you want employees sorted;either alphanumeric (employee name) or numeric(employee number).


If you select Report Only, the application listsemployees with their eligibility dates.


First run this form in Report Only to review theupdated benefits. Then run this report as Update.

5. Choose the Add function.6. Choose the Submit function.

WARNING Do notenter or change benefitenrollments while thisupdate program isrunning.


297

Related Reports and InquiriesTo UseView records requiring updating Benefit Status Report (BN220)

Updating Enrollment for Frequency Table ChangesThis procedure outlines the tasks to update employee deductions when afrequency table assigned to a benefit plan or flex plan changes. You can alsouse this procedure if you assign a different frequency table to a benefit plan.

IMPORTANT Update employee deductions and standard time records beforeyou run the next payroll cycle. If changes have occurred, Earnings andDeductions Calculation (PR140) prompts you to update employee benefits.

STEPS To update enrollment for frequency table changes1. Access Frequency Table Update (BN104).

Figure 58. Form clip: Using BN104 to update enrollment for frequency table changes


you identify a batch job by providing additional information.4. Complete the Parameters section. Consider the following fields.


Flex Plan If you want to update a flex plan, select the flexplan.


Plan Type Type an X next to the type of benefits you wantto update.

If you did not select a flex plan, you must selectat least one benefit type. If you selected a flexplan, do not select a plan type.

Benefit types are:� HL = Health� DN = Dental� DI = Disability� EL = Employee Life� DL = Dependent Life� DC = Defined Contribution� DB = Defined Benefit� VA = Vacation Buy or Sell� RS = Spending Account� SB = Savings Bond� SP = Stock Purchase

Plan Select a benefit plan for which you want to updateemployee deductions.

If you leave all the Plan fields blank, the reportincludes all plans of the benefit types that youselected in the Benefit Type fields.

As of Date Type the date the application will use to determinewhich benefits to update. Only enrollments ineffect on this date will be updated. If a benefithas a stop date equal to or earlier than this date,it will not be updated.

EmployeeSequence



If you select Report Only, the application listsemployee benefits to be updated.

If you select Update, the application updatesemployee deductions and time records and listsall updated benefits.

First run this form in Report Only to review theupdated benefits. Then run this report as Update.



299

Related Reports and InquiriesTo UseView records requiring updating Benefit Status Report (BN220)

Terminating or Replacing a BN PlanThis procedure outlines those tasks to terminate benefits under a benefit planor a flex plan. You can terminate benefits for all employees in a process level,a processing group, an employee group or a plan option.

If you are terminating flex benefits, this procedures stops the employee�sflex dollar record and all benefits under the flex plan. Flex benefits arestopped in reverse order; that is, the last benefit added is stopped first and thefirst benefit added is stopped last.

This procedure stops an employee�s benefit, deductions and, if applicable,standard time record. You can also create a CSV (Comma Separated Value)file to transfer benefits from one plan to another, using this procedure.

STEPS To terminate or replace a BN plan1. Access Mass Benefit Termination (BN103).

Figure 59. Form clip: Using BN103 to terminate or replace a BN plan

2. Type the name of the job in the Job Name field.3. Type a job description in the Job Description field. The job description

provides additional information to help you identify a batch job.4. Change the information in the Parameters section. Consider the following

fields.


Plan Type Select the plan type for the plan you want to end.

Plan Select the benefit plan you want to end.


Processing Group If you want to terminate benefits for only thoseemployees in a particular processing group,select the processing group.


Process Level If you want to terminate benefits for only thoseemployees in a particular process level, selectthe process level.

NOTE If you select a process level, leave theProcess Group and Employee Group fields blank.

Employee Group If you want to terminate benefits for only thoseemployees in a particular employee group, selectthe employee group.

NOTE If you select a processing group, leavethe Process Level and Processing Group fieldsblank.

Coverage Options To terminate benefits for employees for aparticular coverage option, select the coverageoption. This is used if a coverage option isdiscontinued.

NOTE This field is valid only if the plan�sCoverage Type field in Benefit Plan (BN15.1) isCoverage Options.

Stop Date Type the date on which you want to terminatebenefits. This date becomes the stop date of theemployee�s benefits, deductions, and standardtime records.

Report Sequence Select if you want the report sorted by employeeor process level and department.

EmployeeSequence



If you select Report Only, the application listsemployee with their eligibility dates.


First run this form in Report Only to review theupdated benefits edits. Then run this report asUpdate.



301

Options for Terminating or Replacing a BN PlanA CSV file created on Mass Benefit Termination (BN103) can be manipulatedand used to load benefit enrollments into a new plan using Batch BenefitEnrollment (BN531).

Deleting a Coverage Option from a Benefit PlanThis procedure outlines the tasks to delete a coverage option from a benefitplan. You must remove the option from three separate forms; BN18.1,BN19.1 and BN17.1.

STEPS To delete a coverage option from a benefit plan1. Access Benefit Plan (BN15.1).2. Select the company, plan type, and plan from which you want to delete the

coverage option.3. Choose the Inquire form function.4. Choose the Contribution button. Options Amounts (BN18.1) opens. The

fields Company, Plan Type, and Plan are populated.5. Select the coverage type from the Cover Type field.6. Type the start date in the Start Date field.7. If appropriate, select the employee group from which you want to delete

the coverage option.8. Choose the Inquire form function.9. Choose the Options button to access Options Rates (BN19.1).10. Select the delete line action needed on the appropriate line.11. Choose the Change form function.12. Close BN19.1. Repeat steps 5 - 11 for all affected records.13. After you have deleted all affected records close BN19.1 and BN18.1.

BN15.1 is still open.14. Choose the Coverage button to access Coverage Options by Plan

(BN17.1).15. Choose the Coverage button on BN17.1 to access Coverage Options De-

faults (BN17.2). The company, plan type, and plan fields are populated.16. Select the Cover Type, type the start date and select the employee group,

if appropriate, for the record from which you want to delete the coverageoption.

17. Choose the Inquire form function.18. Select the delete line action for the coverage you deleted in step 10.19. Choose the Change form function.20. Repeat steps 16 - 19 for all affected records. Close BN17.2.21. Select the delete line action for the coverage option deleted in steps 10 -

19.22. Choose the Change form function.


Chapter 18

Plan Maintenance: Vacation Buy and SellWhen a flex vacation-type plan is associated with a plan in the TimeManagement application, you update employee vacation balances with thehours employees purchase or sell.



BNProcesses

MaintainingBN Plans

PlanMaintenance

Flex Plans

Employees

BN PlanEnrollment

BN Company

Preliminaries

Setup

Flex Plan

BN-Plans

BNAutomation

Rules

MaintainEmployee

Enrollments


SavingsBond

Update

Benefit PlanTesting


SpecialProcessing


BN-PlanCoverage



Retirees

You Are Here

BN EntryRules

Benefits Administration User Guide Chapter 18 Plan Maintenance:Vacation Buy and Sell

303

Procedure in this Chapter

Update Employee Vacation BalancesThe update transactions (records) created by Vacation Hours Update (BN138)are processed by the Lawson Time Management application. For moreinformation, see the Time Management User Guide.

STOP To use this report, you must have the Time Management application.Ensure that the employee is enrolled in a vacation plan on Employee PlanInquiry (TA60) before updating the employee�s vacation balance with VacationHours Update (BN138).

When a flex vacation-type plan is associated with a plan in the TimeManagement application, update your employee vacation balances withthe hours employees purchase or sell. Vacation Hours Update (BN138)creates manual transactions for eligible hours, and these transaction recordsare viewed on Plan Adjustments (TA70.1) or Employee Plan Adjustments(TA70.2).



304 Chapter 18 Plan Maintenance:Vacation Buy and Sell


STEPS To update employee vacation balances1. Access Vacation Hours Update (BN138).2. Consider the following fields.

Flex Plan Select the flex plan for which the report is beingrun. This is a required field. This is the flex planthat the vacation-type benefit plan is linked withon Benefit Plan (BN15.1).

Flex Year StartDate

Select the start date of the flex plan year. Thisis a required field.

Time Accrual Date Type the date of the time accrual transactions.This is a required field.

Plan Select a vacation-type benefit plan that you wanton the report. If you leave the Plan fields blank,the report creates transactions for all vacationplans in the selected flex plan.

Update Select Update or Report Only. This is a requiredfield. Lawson recommends that you select ReportOnly to review the report before selecting Update.


TIP If mid-yearenrollment changesare allowed, manualtime accrual planadjustments areneeded. For moreinformation, see theTime Management UserGuide.

4. Submit the report.

Related Reports and InquiriesTo UseList the vacation hours purchased orsold by employees

Vacation Hours History (BN238)

View the time accrual transactionscreated by Vacation Hours Update(BN138) after running in Updatemode

Plan Adjustments (TA70.1)

Employee Plan Adjustments(TA70.2)

Open Manual Transactions (TA270)

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Chapter 19

Plan Maintenance: Spending AccountBalances

This chapter focuses on tracking spending account withdrawals for employeesand COBRA participants.



BNProcesses

MaintainingBN Plans

PlanMaintenance

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Employees

BN PlanEnrollment

BN Company

Preliminaries

Setup

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BN-Plans

BNAutomation

Rules

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Enrollments


SavingsBond

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Tracking Spending Account ReimbursementsTrack spending account withdrawals for employees and COBRA participantsusing Spending Account Transactions (BN59.1).



STEPS To track spending account reimbursements1. Access Spending Account Transactions (BN59.1).2. In the Employee field, select an employee. This is a required field. A CO-

BRA participant must have an employee number to add a spending ac-count benefit. For more information, see "Defining a COBRA Participant"on page 270.

3. Consider the following required fields.

Date Type the date of the expense reimbursement.

Payment Type the payment number for the employeereimbursement of expenses.

Amount Type the amount the employee received forreimbursement of eligible expenses from thespending account.

Description Type a description of the transaction.


Options for Spending Account TransactionsThe following options are available from Spending Account Transactions(BN59.1).

Choose the Benefit Totals button to open the Enrollment Period Totalssubform, which shows the employee�s annual contribution, contributions todate, reimbursements, and account balance during an enrollment period.

Choose the Plan Year Totals button to open the Plan Year Spending AccountTotals subform, which shows the employee�s year-to-date annual contribution,contributions to date, reimbursements, and account balance.

308 Chapter 19 Plan Maintenance: SpendingAccount Balances


Related Reports and InquiriesTo UseList spending account balances Spending Account Balance (BN258)

List spending account transactions Spending Account Payment Report(BN259)

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Chapter 20

Plan Maintenance: Stock PurchaseUpdate

This chapter focuses on updating an employee�s stock account balance inorder to purchase stocks for the employee.



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MaintainingBN Plans

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Employees

BN PlanEnrollment

BN Company

Preliminaries

Setup

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BNAutomation

Rules

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Enrollments


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Update

Benefit PlanTesting


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Procedures in this Chapter

Updating Stock PurchasesRun the Stock Purchase Update (BN141) report to determine the amount ofstocks to purchase for a particular plan at a specified stock price.

STEPS To update stock purchases1. Access Stock Purchase Update (BN141).2. Consider the following fields.

Price Per Share Type the price per share of stock. This price pershare determines the total number of shares anemployee can purchase with his or her currentaccount balance. This is a required field.

Date Purchased Type the date you want to purchase the stock.If you leave this field blank, the report uses thesystem date.

NOTE This field updates the Date Purchasedfield in Stock Purchase History (BN61.1).

Plan Select a stock purchase plan. If you leave allthe Plan fields blank, the report updates all stockpurchase plans.

Update Select Update or Report Only. This is a requiredfield. Lawson recommends that you select ReportOnly to review the report before selecting Update.



Display the shares of stock anemployee has purchased

Stock Purchase History (BN61.1)

312 Chapter 20 Plan Maintenance: Stock PurchaseUpdate


Chapter 21

Plan Maintenance: Savings Bond UpdateOnce a savings bond plan is defined, you must designate beneficiaries, definea purchase sequence, and update the account balance.



BNProcesses

MaintainingBN Plans

PlanMaintenance

Flex Plans

Employees

BN PlanEnrollment

BN Company

Preliminaries

Setup

Flex Plan

BN-Plans

BNAutomation

Rules

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Enrollments


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Update

Benefit PlanTesting


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Procedures in this ChapterAfter the saving bonds plan is defined on Benefit Plan (15.1), you canpurchase saving bonds for an employee through the following process. Thischapter focuses on the procedures that make up this process.

Figure 60. Procedure relationship:Savings Bond Update

Adding SavingsBond Beneficiaries

Defining SavingsBond Purchase

Sequence

Updating SavingsBond Purchase

Adding Savings Bond BeneficiariesDefine each possible owner, co-owner and beneficiary for savings bondspurchased by an employee. For more information, see "Defining SavingsBond Purchase Sequence" on page 315.

314 Chapter 21 Plan Maintenance: Savings BondUpdate


STEPS To add savings bond beneficiaries1. Access Savings Bond Beneficiaries (BN48.1).2. Consider the following fields.

Code Type a code that represents the owner, co-owner,or beneficiary of a savings bond. This code isused to define the owner, co-owner, or beneficiarysequence on Savings Bond Purchase Sequence(BN48.2). This is a required field.

Dependent If the owner or beneficiary is the employee�sdependent with a record in Dependent (HR13.1),select the dependent. The dependent�s nameand Social number default from Dependent(HR13.1).

NOTE When you purchase bonds using SavingsBond Update (BN140), the application uses thedependent�s current address from HR13.1. Forthis reason, the dependent�s address does notdefault to BN48. Override the address usingBN48 if necessary.


Defining Savings Bond Purchase SequenceDefine a sequence of owners, co-owners, and up to 12 beneficiaries for whombonds are purchased. Bonds cannot be purchased for an employee until atleast one sequence is defined for the employee.

For example, an employee wants to purchase bonds for herself, her spouse,and her two children, in that sequence. To do this, define the sequencerecords, one for each person beginning with the employee.


315

STEPS To define savings bond purchase sequence1. Access Savings Bond Purchase Sequence (BN48.2).2. Consider the following fields.

Plan Select the bond purchase plan. This is a requiredfield.

Start Date Type the start date of the bond sequence record.This is a required field. Bonds purchased afterthis date use this sequence record.

Sequence Type the sequence number for this owner orco-owner. This field determines the order inwhich Savings Bond Purchase (BN140) buysbonds.

Owner Select the bond�s owner. This is a required field.

Co-owner Select the bond�s co-owner.

Beneficiaries Select a beneficiary for the bond.


Related Reports and InquiriesTo UseDisplay the savings bonds anemployee has purchased

Savings Bond History (BN60.1)

List the saving bonds an employeehas purchased

Savings Bond Balance Report(BN240)

List the sequence in which savingsbonds are purchased for owners,co-owners, and beneficiaries ofsavings bonds


Updating Savings Bond Purchases

STOP Bonds are not purchased for an employee until at least onesequence is defined. For more information, see "Defining Savings BondPurchase Sequence" on page 315.

Run the Savings Bond Update (BN140) report to determine an employee�saccount balance for the purchase of savings bonds. It is recommended thatyou run Savings Bond Update (BN140) after each payroll is closed withPayroll Close (PR197) or when the contribution data has been interfaced froma non-Lawson payroll application into the Lawson Benefits Administrationapplication with Payroll Interface (BN500). The payroll close looks at eachbond plan participant�s contribution deductions, and adds them to the



participant�s account balance. Once the balance is updated, Savings BondUpdate (BN140) looks at the participant�s balance and determines if there isenough money to purchase a bond.

The report is sorted by savings bond plan and employee. For each employee,the report shows the bonds purchased, the bond owner, the owner�s address,and the owner�s social number. If a co-owner and beneficiary have beenassigned, their names, addresses, and social numbers also list. BN140 usesthe employee�s or dependent�s current address from Employee (HR11.1) andDependent (HR13.1) unless the address has been overridden in SavingsBond Beneficiary (BN48.1).

STEPS To update savings bond purchase1. Access Savings Bond Update (BN140).2. Consider the following fields.

Company Select a company. This is a required field.

Plan Select a savings bond plan that you want on thereport.

If you leave all the Plan fields blank, all savingsbond plans are updated.

Date Type an As of date for the bond update. Thedate you type corresponds to the sequence inSavings Bond Purchase Sequence (BN48.2).The Benefits Administration application uses thelatest sequence record as of this date.



Related Reports and InquiriesTo UseList the saving bonds an employeehas purchased

Savings Bond Balance Report(BN240)

List the sequence in which savingsbonds are purchased for owners,co-owners, and beneficiaries ofsavings bonds


Display the savings bonds anemployee has purchased

Savings Bond History (BN60.1)


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Chapter 22

Plan Maintenance: Benefit Plan LimitsThis chapter focuses on maintaining benefit plan balances. Make adjustmentsto contribution balances, covered compensation, or vesting hours for definedcompensation and defined benefit plans.



BNProcesses

MaintainingBN Plans

PlanMaintenance

Flex Plans

Employees

BN PlanEnrollment

BN Company

Preliminaries

Setup

Flex Plan

BN-Plans

BNAutomation

Rules

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Enrollments


SavingsBond

Update

Benefit PlanTesting


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Procedures in this ChapterMake adjustments to your defined benefit or defined contribution plans.

Adjusting Defined Contribution orDefined Benefit Plan Balances

Use this procedure to track accountbalances and make adjustmentswhere necessary.

Adjusting Covered CompensationBalance

Use this procedure to adjust coveredcompensation balances.

Adjusting Vesting Hours Use this procedure to adjust vestinghours.

Adjusting Defined Contribution or Defined Benefit PlanBalances

Track account balances for each employee in a defined contribution (DC) planor a defined benefit (DB) plan. Make adjustments where necessary.

Use DC/DB Balance (BN55.1) for making individual adjustments. If you needto make a large number of adjustments, import the adjustments from a csvfile using DC/DB Balance Conversion (BN555).

STEPS To adjust defined contribution or defined benefit plans1. Access DC/DB Balance (BN55.1).2. Select the Company, Employee, Plan Type, Plan, and type the Plan Year.3. Choose the Inquire form function.4. Type the adjustment figure in the appropriate enterable field to make ap-

propriate adjustments.

IMPORTANT The amount entered must be the amount to change thebalance, not the new amount balance. If subtracting an amount, type theminus sign at the end of the amount to change.


Options for Defined Benefit or Defined ContributionAdjustmentsThe following options are available.

Choose the Totals button from DC/DB Balance (BN55) to access the VestedAmounts subform. The Vested Amounts subform displays employee vestinginformation including the numbers of years vested, the vested percent,

320 Chapter 22 Plan Maintenance: Benefit PlanLimits


and the total to date vested amount. For more information, see "AdjustingVesting Hours" on page 322.

Related Reports and InquiriesTo UseImport a csv file with definedcontribution or defined benefit planbalance adjustments

DC/DB Balance Conversion (BN555)

List total contributions by investmentaccounts for DC plans

DC Plan Contributions (BN 330)

Adjusting Covered Compensation BalancesYou can adjust employee compensation amounts and participation hours fordefined contribution and defined benefit plans for each plan year.

Record history for the years before you started using the BenefitsAdministration application.

STEPS To adjust covered compensation balances1. Access Compensation History (BN56.1).2. Select the Company, Employee, Benefit Type, and Plan, and choose the

Inquire form function.NOTE The maximumcompensation displayedin each row is definedon Benefit Annual Limits(BN12.1). When anemployee�s coveredcompensation reachesthis limit, the applicationstops the employee�scontributions to the plan.

3. Consider the following fields whenmaking adjustments or recording history.

Year To track on earlier years, type the plan year forwhich compensation and participation hours arebeing recorded.

Hours This field displays the total hours of service forthe plan year. The total hours are based on thecompensation pay class on the Vest Comp tabon Benefit Plan (BN15). To adjust the hours or totrack hours of service for earlier years, type thetotal hours of service for that year.

Compensation This field displays the total employeecompensation for the plan year. The totalemployee compensation is based on thecompensation pay class on the Vest Comp tabon Benefit Plan (BN15). To adjust compensationor track compensation for earlier years, type anamount of compensation for that year.


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Related Reports and InquiriesTo UseList the plan participants of definedcontribution and defined benefitplans


Adjusting Vesting HoursView or adjust employee vesting hours for defined contribution and definedbenefit plans. The Benefits Administration application tracks vesting hoursbased on the vesting pay class selected on the Vest Comp tab of Benefit Plan(BN15.1). Vesting Hours (BN57.1) tracks vesting hours for all employees,even if the employee is not enrolled in a defined contribution or definedbenefit plan. If the plan counts vesting for years before the plan start date,the Benefit application assumes that the employee met the minimum vestingrequirements for each of those years. If an employee did not meet minimumvesting requirements for a year, define the actual number of vesting hours forthat year. If you define an amount of hours for a year that is less than theminimum vesting requirement, the application does not count that year.

STEPS To adjust vesting hours1. Access Vesting Hours (BN57.1).2. Select the Company, Employee, Benefit, and Plan, and choose the Inquire

form function.3. Type the adjustment figures in the appropriate enterable field.4. Choose the Change form function.

Related Reports and InquiriesTo UseList each plan participant�s vestedpercent

Vesting Report (BN237)

322 Chapter 22 Plan Maintenance: Benefit PlanLimits


Chapter 23

Benefit Processes: Reportable ExcessGroup Life Insurance

This chapter focuses on incorporating the taxable income resulting fromexcess life insurance into the employee�s taxable wages.

The procedure in this chapter generates time records that are processed bythe Payroll application. For more information, see the Payroll User Guide.

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BNProcesses

MaintainingBN Plans

PlanMaintenance

Flex Plans

Employees

BN PlanEnrollment

BN Company

Preliminaries

Setup

Flex Plan

BN-Plans

BNAutomation

Rules

MaintainEmployee

Enrollments


SavingsBond

Update

Benefit PlanTesting


SpecialProcessing


BN-PlanCoverage



Retirees

You Are Here

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324 Chapter 23 Benefit Processes: ReportableExcess Group Life Insurance



Creating Reportable Income Time RecordsWhen a company pays all or a portion of the premiums for an employee onGroup Term Life Insurance, the employee must pay taxes on the valueof the amount of coverage over $50,000. The coverage over $50,000 isreferred to as excess coverage. Life Insurance Reportable Income (BN150)calculates, for each employee, the taxable amount associated with excessemployee and dependent life insurance coverage. The taxable amountis called imputed income.

Perform the update every pay cycle, monthly, or once at the end of theyear. Create a time record to add the imputed income to the employee�staxable wages.

For information on how the application determines the value of excessemployee coverage, see "Calculating the Cost of Excess Life Insurance"on page 404.

STOP A life benefit plan must have a Yes in the Reportable Life field onthe Misc tab on Benefit Plan (BN15.1) to be included in the Life InsuranceReportable Income calculation. For more information, see "Defining a PrimaryBenefit Plan" on page 95.

STOP You must define parameters to calculate an employee�s tax liabilityfor excess employee and dependent life insurance. The Internal RevenueService (IRS) determines the monthly cost table. For more information, see"Defining Excess Life Insurance Rates" on page 42.



STEPS To create reportable income time records1. Access Life Insurance Reportable Income (BN150).


325

Figure 61. Form clip: Using BN150 to create reportable income time records

2. From the Parameters section, Consider the following fields.

As of Date Type the date of the benefits you want to use forthe report. This is a required field. The BenefitsAdministration application performs calculationsbased on the benefits in effect on the datespecified.

NOTE To be included, the benefit start date mustbe less than or equal to this date and the stopdate must be equal to or greater than the date.

Report Option Select the kind of benefits you want in the report.This is a required field.

Use Pre-TaxAmount

If employees pay for life insurance on a pre-taxbasis, select the value that indicates whetherthe application should use the calculated valueof excess life insurance and disregard theemployee�s pretax contributions. This is arequired field.

If you select Yes, the system uses the greateramount of the calculated value of excess lifeinsurance or the employee�s pretax contributionas the basis for the W2 reportable income. Ifyou select No, the system uses the calculatedvalue of excess life insurance and disregards theemployee�s pretax contributions.



Frequency Select the period for which you want to run thereport. This is a required field and impacts thecalculation.

IMPORTANT Imputed income is calculated asan annual amount then divided by a numbercorresponding to the frequency selected.

Time Records Select the value that indicates whether you wantthe report to create time records.

The Lawson Payroll application uses the timerecords to update an employees taxable wagesfor the value of excess life insurance.

Time Record Date To create time records, type the date for the timerecord.

Update Select the function you want to perform. This isa required field. Lawson recommends that youselect Report Only to review the report beforeselecting Update.



327

Chapter 24

Benefit Processes: Benefit Plan TestingThis chapter focuses on procedures you must perform periodically to audityour benefits data.



BNProcesses

MaintainingBN Plans

PlanMaintenance

Flex Plans

Employees

BN PlanEnrollment

BN Company

Preliminaries

Setup

Flex Plan

BN-Plans

BNAutomation

Rules

MaintainEmployee

Enrollments


SavingsBond

Update

Benefit PlanTesting


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BN-PlanCoverage



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Procedures in this ChapterThe following procedures are used to audit your benefit plan data. Performthese procedures whenever you need to test your benefit plans forcompliance or participation.

Listing Key Employees Use this procedure to identify keyemployees to update the Key fieldon Employee (HR11.1).

Determining if DefinedContribution Plans are TopHeavy

Use this procedure to list DCaccount balances for key andnon-key employees.

Listing Highly CompensatedEmployees

Use this procedure to identify highlycompensated employees to updatethe Highly Compensated field onEmployee (HR11.1).

Performing the ADP and ACP Test Use this procedure to determinewhether a defined contributionplan satisfies the Actual DeferralPercentage (ADP) and ActualContribution Percentage (ACP)tests.

Determining if Employees areReaching an Elective DeferralLimit

Use this procedure to determinewhether employees� contributionsare reaching an elective deferrallimit.

Determining Percentage DC/DBPlan Participation

Use this procedure to determinewhether defined contribution ordefined benefit plans satisfy thepercentage test.

Listing Key EmployeesDefine the criteria that the report uses to determine which employees are key,and then run the report to list employees who meet those criteria. Once youhave identified the key employees, set the Key field on the Plan Test formtab of Employee (HR11.1). This information is used when you run the TopHeavy Report (BN310). For more information, see "Determining if DefinedContribution Plans are Top Heavy" on page 332.

STOP Before running this report, identify all officers and owners of thecompany by setting the appropriate fields on the Plan Test form tab ofEmployee (HR11.1). Only employees with officer or owner designationwill be considered for this report.

330 Chapter 24 Benefit Processes:Benefit Plan Testing


STEPS To list key employees1. Access Key Employees (BN300).

IMPORTANT The application does not use the annual salary from the Paysubform on Employee (HR11.1) to determine compensation. Rather theapplication uses payroll history for the dates designated.


Plan Start Date Type the plan�s start date. The application usespayroll records for the twelve month periodbeginning on this date to determine actualemployee compensation. This is a required field.

Officer:

Compensation

Type the minimum compensation an officer musthave received to be included as a key employee.Only officers whose compensation is equal to orgreater than this amount for the period identifiedare included on the report. If you leave this fieldblank, all employees designated as officers willbe included.

Owner:

Compensation 1

Type a compensation amount to identify ownersas key employees who own the largest interest inthe company. All employees identified as ownersare included on the report, but only ownerswhose compensation is equal to or greater thanthis amount for the period identified are listed asowning the largest interest in the company.

Owner:

Compensation 2

Type the minimum compensation an owner musthave received to be included as a key employee.All employees identified as owners are includedon the report, but owners whose compensation isequal to or greater than this amount are identifiedas key employees.

3. Choose the Add form function.4. Submit the report.5. Access Employee (HR11.1) and set the Key field flag on the Plan Test form

tab for each key employee identified from the report.


331

Determining if Defined Contribution Plans are Top HeavyNOTE This report onlyruns for employees whohave a work countryof US.

To determine if your defined contribution (DC) plan is top heavy, the reportlists DC account balances from DC/DB Account Balance (BN55.1) for keyemployees as well as non-key employees within the plan year specified.

STOP Verify that your key employees are flagged on Employee (HR11.1).For more information, see "Listing Key Employees" on page 330.

STEPS To determine if defined contribution plans are top heavy1. Access Top Heavy Report (BN310).2. From the Parameters section, Consider the following fields.

Plan Year Type the plan year for which the report is beingrun. Use the format YYYY (for example, 1999).This is a required field.

The month and day of the start date entered onBenefit Plan (BN15.1) are used to determinewhen this plan year begins. If the report containsmultiple plans with different start dates, the reportwill print balances for each plan based on thisplan year.

Plan Select a plan that you want on the report. If youselect more than one plan, the report combinesemployee account balances for all plans with thesame plan year. If you leave the fields blank, alldefined contribution plans list with a total for eachemployee.


Listing Highly Compensated EmployeesDefine the criteria that the report uses to determine which employees arehighly compensated and then run the report to list employees who meet thatcriteria. Once you have the highly compensated employees identified, set theHighly Compensated field on the Plan Test form tab of Employee (HR11.1).This information is used when you run the ADP and ACP Tests (BN340). Formore information, see "Performing the ADP and ACP Tests" on page 334.

IMPORTANT The application does not use the annual salary from the Paysubform on Employee (HR11.1) to determine compensation. Rather theapplication uses payroll history for the dates designated.



STEPS To list highly compensated employees1. Access Highly Compensated Employees (BN305).2. From the Parameters section, consider the following field.

Plan Start Date Type the plan�s start date. This isa required field. The applicationuses payroll records for the yearbeginning on this date to determineactual employee compensation.

3. From the Preceding and Current Year section, consider the following fields.

Compensation 1 Type an amount of compensation to selectemployees who received compensation greaterthan this amount as highly compensatedemployees.

Compensation 2 This field works with the Top-paid Percentfield to determine which employees are highlycompensated. Type an amount of compensationto select employees who received compensationgreater than this amount. An employee isconsidered highly compensated if the employee�scompensation exceeds this amount and theemployee is in the percent group of employeesspecified in the Top-paid Percent field.

Top-paid Percent Type the percent of top-paid employees who areconsidered to be highly compensated and whoreceived compensation greater than the amountspecified in the Compensation 2 field.

OfficerCompensation

Type an amount of compensation to selectemployees who are identified as officers in theBenefits subform of Employee (HR11.1) and whoreceived compensation greater than this amount.If you leave this field blank, all officers will belisted on the report.

4. From the Current Year section, consider the following field.

Number of Employees To select a specified numberof highest paid employees inthe company, type the numberof top-paid employees you wantlisted. For example, if you type 100the report lists the 100 top-paidemployees in the company.

5. Choose the Add form function.6. Submit the report.7. Access Employee (HR11.1) and set the Highly Compensated field flag on

the Plan Test form tab for each employee identified from the report.


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Performing the ADP and ACP TestsDetermine whether a defined contribution plan satisfies the Actual DeferralPercentage (ADP) and Actual Contribution Percentage (ACP) tests. TheADP test calculates and compares actual deferral percentages for highlycompensated and non-highly compensated employees.

STOP Verify that your highly compensated employees have beenflagged on Employee (HR11.1). For more information, see "Listing HighlyCompensated Employees" on page 332.

STEPS To perform the ADP and ACP tests1. Access ADP and ACP Tests (BN340).2. From the Parameters section, Consider the following fields.

Plan Year StartDate

Type the plan year start date. This is a requiredfield.

The application uses payroll records for theyear beginning on this date to determine actualemployee compensation. The plan year startdate also determines which defined contributionrecords are used on the report.

Plan Select a defined contribution plan that you wanton the report.

If you leave all the Plan fields blank, the reportincludes all defined contribution plans.

Compensation Select the compensation you want on the report.This is a required field.

The program uses compensation from the Payrollapplication up to the maximum amount defined inBenefits Annual Limits (BN12.1).

Pay Class If you select Pay Class in the Compensationfield, select the pay class that you want to use todetermine compensation.

Report Option Select the contributions you want to include onthe report. This is a required field.




Determining if Employees are Reaching an Elective Defer-ral LimitNOTE The Payrollapplication determineselective deferrallimits using BusinessSoftware, Inc. (BSI).

Determine whether an employee�s contributions to 401(k), 403(b), or 457plans approach the elective deferral limit or the maximum annual additionslimit. Use the report to stop or reduce contributions for those employees whoare reaching the percent of compensation limit.

STEPS To determine if employees are reaching their elective deferrallimit1. Access Employee Deferral Report (BN335).2. From the Parameters section, Consider the following fields.

Tax Year Type the tax year for which the report is beingrun. This is a required field.

Report Option Select the report you want. This is a requiredfield.

If you select Annual Additions Maximum, thereport uses the maximum annual additions limitfrom Benefits Annual Limits (BN12.1). If youselect Elective Deferral Limit, the report listsemployees who are approaching the electivedeferral limits for the tax year.

DC Type If you selected Elective Deferral Limits in theReport Option field, select the kind of definedcontribution plan you want on the report.

ContributionPercent

If you selected Elective Deferral Limits in theReport Option field, type the percentage ofthe Maximum Deferral field amount that anemployee�s elective deferral must exceed toappear on the report. For example, if you type 75,the report shows employees whose contributionsare 75 percent or more of the amount in theMaximum Deferral field.

Maximum Deferral If you selected Elective Deferral Limits in theReport Option field, type the current annualpretax deferral limit for the type of definedcontribution plan selected in the DC Type field.


Determining Percentage DC/DB Plan ParticipationNOTE The report isbased on participationon the system date.

Determine whether defined contribution (DC) or defined benefit (DB) planssatisfy the percentage test, also called the 70 percent test. The percentagetest compares the number of employees who are eligible for the plan with the


335

number of participants. To determine which employees are eligible, the testuses the eligibility requirements of each benefit plan.

STEPS To determine the percentage of DC or DB plan participation1. Access Percentage Test (BN345).2. From the Parameters section, Consider the following fields.

Benefit Type Select the type of plan you want to test. This is arequired field.

Plan Select a plan for the test. If you leave all thePlan fields blank, the report includes all plans forthe benefit types that you selected in the BenefitType field.




Chapter 25

Benefit Processes: Retiree or COBRAInvoicing and Tracking

This chapter focuses on creating and printing COBRA participant or retireeinvoices and updating your invoices and payments to General Ledger.



BNProcesses

MaintainingBN Plans

PlanMaintenance

Flex Plans

Employees

BN PlanEnrollment

BN Company

Preliminaries

Setup

Flex Plan

BN-Plans

BNAutomation

Rules

MaintainEmployee

Enrollments


SavingsBond

Update

Benefit PlanTesting


SpecialProcessing


BN-PlanCoverage



Retirees

You Are Here

BN EntryRules

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Procedures in this ChapterThe following procedures explains how to create and print retiree and COBRAparticipant invoices and update your invoices and payments to the GeneralLedger Application.

Creating Manual Invoices Create retiree or COBRA participantinvoices for partial premiums or forretroactive premiums.

Creating Monthly Invoices Create monthly invoices and generalledger transactions for retirees orCOBRA participants.

Printing Invoices Print premium invoices for retireesand COBRA participants.

Entering and AutomaticallyApplying Payments

Enter the payment and allowthe Benefits Administration toautomatically apply the payment.

Entering and Manually ApplyingPayments

Enter payments for retiree orCOBRA participant invoices andapply the payment to the appropriateinvoice.

Updating Invoices and Paymentsto General Ledger

Create general ledger transactionsfor monthly and manual invoices andfor payments not yet updated.

Creating Manual InvoicesCreate invoices for retirees or COBRA participants for partial premiums or forretroactive premiums. Change your manual invoices until you run GeneralLedger Update (BN190). For more information, see "Updating Invoices andPayments to General Ledger" on page 345.

STEPS To create manual invoices1. Access Manual Invoice Entry (BN80.1).2. Consider the following fields.

Invoice Number If you are adding an invoice, leave this field blank;the application sequentially assigns invoicenumbers for each retiree or COBRA participant.

Plan Type Select the benefit type for which the invoice isbeing created. This is a required field.

338 Chapter 25 Benefit Processes: Retiree orCOBRA Invoicing and Tracking


Plan Select the plan for which premiums are beinginvoiced. This is a required field.

Start Date Type the start date of the retiree�s or participant�sbenefit record for which premiums are beinginvoiced. This is a required field.

NOTE To see start dates for the retiree orCOBRA participant, drill around on the Participantor Retiree field.

3. From the Invoice section, Consider the following fields.

Invoice, Due Date Type the manual invoice date that you want toprint on the invoice. In the second field, type thedate the payment is due. This date prints as thepremium due date on the invoice. The applicationuses this date to determine when a payment isoverdue. These are required fields.

Invoice Amount Type the invoice amount to be billed to the retireeor COBRA participant. The invoice amount printson the invoice created by Invoice Print (BN181)as the premium due amount. This is a requiredfield.

For retirees, the invoice amount must be lessthan or equal to the premium amount. ForCOBRA participants, the invoice amount must begreater than or equal to the premium amount.

Premium Amount Type the premium amount for general ledgertransactions. This is a required field.

The premium amount is used to create generalledger transactions; the premium amount doesnot print on invoices. For retirees, the amountwill include the company paid portion of thepremium. For COBRA participants, the amountwill not include any administrative fees that wereincluded in the invoice amount.

NOTE The invoice�sgeneral ledgerinformation defaultsafter you add theinvoice.


Related Reports and InquiriesTo UseList manual invoices Invoice Edit (BN180)

Display all invoices, payments, andcredit memos for a retiree or COBRAparticipant

Transaction Inquiry (BN82.1)


339

Creating Monthly InvoicesYou can create invoices and general ledger transactions for retirees andCOBRA participants on a monthly basis. When you process Invoice Edit(BN180) for the creation of monthly invoices, the invoice period mustcorrespond to the billing period on Benefits Company (BN00.1) for retireesand COBRA Parameters (BN00.2) for COBRA participants. For moreinformation, see " Setup: BN Company" on page 33.

STEPS To create monthly invoices1. Access Invoice Edit (BN180).

Figure 62. Form clip: Using BN180 to create monthly invoices


Invoice Period Type the date you want the application to use tocreate invoices. This is a required field. Invoicesare created for retirees and COBRA participantswith benefits in effect on this date.

NOTE The first time you run Invoice Edit(BN180), the Billing Period fields in BN00.1 forretirees and in BN00.2 for COBRA participantsare populated. Thereafter, when you run BN180,the month and year of the date in this field mustcorrespond to the billing period date in BN00.1for retiree invoices and the billing period date inBN00.2 for COBRA participant invoices.

Invoice Date Type the invoice date. This is a required field.The date you type prints on each invoice.

Due Date Type the date that payments are due. If youleave this field blank, the application calculatesthe due date using the Due Date field in BenefitsCompany (BN00.1) for retirees and COBRAParameters (BN00.2) for COBRA participants.



Selection Option Select the kind of invoices that you wantprocessed. This is a required field. If you selectManual Invoices, the report lists the invoicescreated in Manual Invoice Entry (BN80.1). If youselect Monthly and Manual Invoices, the reportlists manual invoices from BN80.1 and createsmonthly invoices for the specified invoice period.

Report Option Select the people for whom invoices are beingcreated.


Related Reports and InquiriesTo UseDisplay all invoices, payments,and credit memos for a COBRAparticipant or retiree


List all benefits in which COBRAparticipants or retirees are enrolled

COBRA, Retiree Benefit Inquiry(BN77.1) or COBRA/Retiree BenefitReport (BN233)

Printing InvoicesPrint premium invoices for retirees and COBRA participants. Invoice Print(BN181) prints manual invoices created in Manual Invoice Entry (BN80.1) andmonthly invoices created in Invoice Edit (BN180).

IMPORTANT If you do not print the current month�s invoices, you will not beable to run Invoice Edit (BN180) for the next month.

STEPS To print invoices1. Access Invoice Print (BN181).2. From the Parameters section, Consider the following fields.

Invoice Option Select the kind of invoices you want to print.

Reprint Option Select the value that indicates whether you wantto reprint invoices for a COBRA participant orretiree. If you select Reprint, enter the COBRAparticipant or retiree number and the invoicenumber of the invoice you want to reprint.



341

Related Reports and InquiriesTo UseList all benefits in which COBRAparticipants or retirees are enrolled

COBRA, Retiree Benefit Inquiry(BN77.1) or COBRA/Retiree BenefitReport (BN233)

Entering and Automatically Applying Payments

TIP Select the CreditMemo in the Type fieldto apply credit towardsan invoice.

Enter the payment and allow the Benefits Administration application toautomatically apply the payment. The application applies payments to theoldest invoice first. Use the Release form action to release the paymentfor updating to the general ledger.

IMPORTANT The application recognizes only invoices that have beenprinted. For more information, see "Printing Invoices" on page 341.

STEPS To enter and automatically apply payments1. Access Cash Entry (BN81.1).

Figure 63. Form clip: Using BN81.1 to automatically apply payments


Type Select the type of cash application. This is arequired field.

Payment, CreditMemo

Type the number of the payment or credit memobeing applied. The payment number and creditmemo numbers must be unique for a COBRAparticipant or retiree. This is a required field.



Amount Type the amount of cash received or the amountof the credit memo. This is a required field.

Transaction Date Type the date of the cash application. This is arequired field. The transaction date is the datepayment was received or the date a credit memowas issued.

Auto Apply Select Yes to automatically apply the payment.The application applies the payment to the oldestinvoice first. If the invoice includes multiplebenefit types, cash is applied in alphabeticalorder for each benefit type.

For more information, see "Entering and ManuallyApplying Payments" on page 343.

Account If you are entering a credit memo, select thegeneral ledger account information for thedebit entry. If you are entering a payment, theapplication debits the Cash Account defined inBenefits Company (BN00.1); the Cash Accountdoes not display and cannot be overridden.

2. Choose the Add form function.3. Choose the Special Actions, Release form function to release the applied

payment to the general ledger.

IMPORTANT Release a payment only when the unapplied amount is zero.

Related Reports and InquiriesTo UseReview released payments Cash Application Edit (BN281)

Display all invoices, payments,and credit memos for a COBRAparticipant or retiree


Entering and Manually Applying PaymentsUse this procedure if you want to apply a payment to an invoice other than theoldest invoice or if you want to spread a payment over multiple invoices. Fillout the needed information on BN81.1 and the application opens BN81.2which displays all open invoices for that COBRA participant or retiree. Youapply the payment to the appropriate invoice.


343

STEPS To enter and manually apply payments1. Access Cash Entry (BN81.1).2. Consider the following fields.

Type Select the type of cash application. This is arequired field.

Payment, CreditMemo

Type the number of the payment or credit memobeing applied. The payment number and creditmemo numbers must be unique for a COBRAparticipant or retiree. This is a required field.

Amount Type the amount of cash received or the amountof the credit memo. This is a required field.

Transaction Date Type the date of the cash application. This is arequired field. The transaction date is the datepayment was received or the date a credit memowas issued.

Auto Apply Select No to enter the payment.

3. Choose the Add form function. The application automatically opens CashEntry and Application (BN81.2).

Figure 64. Form clip: Using BN81.2 to manually apply payments

TIP If the unappliedamount is not equal tothe invoice amount,apply the difference toan over-short account.

4. In Cash Entry and Application (BN81.2), the Unapplied Amount andInvoices display. Type the unapplied amount into the appropriate ApplyAmount field(s).

IMPORTANT The application recognizes only invoices that are printed.If there is no invoice to apply the payment to yet, close Cash Entry andApplication (BN81.2). The payment is entered in the application. Apply thepayment at a later date, after the invoices are run. For more information, see"Printing Invoices" on page 341.



5. Choose the Change form function.6. Choose the Special Actions, Release form function to release the applied

payment to the general ledger.

IMPORTANT Release a payment only when the unapplied amount is zero.



Review released payments Cash Application Edit (BN281)

Updating Invoices and Payments to General LedgerCreate General Ledger transactions for monthly and manual invoices thatwere printed in Invoice Print (BN181) and for released payments not yetupdated.

STEPS To update invoices and payments to General Ledger1. Access General Ledger Update (BN190).2. Consider the following fields.

GL Posting Date Type the general ledger posting date. This is arequired field.

Update Select the action you want to perform. This isa required field. Lawson recommends that youselect Report Only to review the report beforeselecting Update.




Review released payments Cash Application Edit (BN281)


345

Chapter 26

Benefit Processes: Special ProcessingThis chapter focuses on individual processes provided in the BenefitsAdministration application.



BNProcesses

MaintainingBN Plans

PlanMaintenance

Flex Plans

Employees

BN PlanEnrollment

BN Company

Preliminaries

Setup

Flex Plan

BN-Plans

BNAutomation

Rules

MaintainEmployee

Enrollments


SavingsBond

Update

Benefit PlanTesting


SpecialProcessing


BN-PlanCoverage



Retirees

You Are Here

BN EntryRules

Benefits Administration User Guide Chapter 26 Benefit Processes:Special Processing

347

Procedures in this ChapterThe following procedures focus on processes that are optional and unique.Use them to simulate benefit elections, forecast and purge enrollments,invoices, and payments.

Simulating Benefit Elections Simulate the cost of various benefitelections to see the effect on anemployee�s wages.

Estimating Take Home Pay Estimate an employee�s net incomefor one pay period.

Forecasting Defined ContributionAccount Balances

Forecast the future account balanceof a defined contribution plan basedon an employee�s contributions andcompany match contributions.

Purging Benefit Enrollments Purge employee, COBRAparticipant, and retiree benefitsand their deductions.

Purging Invoices and Payments Purge invoice and payment recordsfor COBRA participants and retirees.

Simulating Benefit ElectionsNOTE You do not needto create a flex dollarrecord for the employeebefore you use thissimulation.

You can simulate the cost of various benefit elections. Use differentcombinations of pretax and after-tax dollars and see the effect of benefits onan employee�s federal taxable wages. For flex plans, the application spendsflex credits before spending employee pre-tax dollars.

STEPS To simulate benefit election1. Access Election Simulation (BN65.1).

348 Chapter 26 Benefit Processes:Special Processing


Figure 65. Form clip: Using BN65.1 to simulate benefit elections

TIP For securitypurposes, theemployee�s gross paydoes not default. Usedrill around to view theemployee�s gross payif your security levelallows.

2. Select the company, employee, and type the As of Date and Gross Pay.3. Choose the Inquire form function. The form displays all benefit plans for

which the employee is eligible.

TIP From the FC fieldnext to the plan name,use the drill aroundfeature to view theplan�s options.

4. Enter the benefit elections desired. For each plan, enter a value in theappropriate column. Consider the following fields.

Cov Opt If the plan has coverage options, type thecoverage option the employee wants.

NOTE A plan has coverage options if theContribution Type field is Coverage Options forthe plan in Benefit Plan (BN15.1).

Mult If the plan�s coverage is a multiple of salary, typethe multiple of salary the employee wants to elect.

Amount For plans offering coverage as an amount, typean amount of coverage.

For defined contribution plans, type the totalannual contribution as a flat dollar amount,including the pretax and after-tax. Do not enterthe contribution as a percent. If the plan onlyallows percent contributions, you are not ableto simulate the election using this form. Forvacation plans, type the number of hours to bebought or sold. For spending accounts, savingsbonds, and stock purchase plans, type the annualcontribution amount.


349

PreTax Type the amount the employee wants to spendon a pretax basis for this benefit, including flexcredits and pretax dollars. If the benefit gives theemployee flex credits, type a negative amount.

If you enter a value in the Cov Opt, Mult,or Amount field, leave this field blank. Theapplication defaults the pre-tax amount when youadd the record, unless the plan allows both preand after tax contributions and no default tax typeis defined for the plan.

AFtTax Type the amount the employee wants to spendon an after-tax basis for this benefit.

If you enter a value in the Cov Opt, Mult,or Amount field, leave this field blank. Theapplication defaults the after-tax amount whenyou add the record, unless the plan allows bothpre and after tax contributions and no default taxtype is defined for the plan.


Options for Simulating Benefit ElectionsThe following options are available from Election Simulation (BN65.1).

After you specify the employee�s contributions, choose the Totals button toaccess the Flex Credits (BN65.2) subform. Use this subform to see the totalflex and pretax dollars the employee can use to purchase benefits and theoverall effect on federal taxable income for the simulated elections.

Estimating Take Home PayEstimate an employee�s net income for one pay period. If you havetransferred directly from Election Simulation (BN65.1) using the local formtransfer, the application uses the simulated elections and annual contributionsfrom BN65.1. Or use the Inquire form function to bring in the data fromElection Simulation (BN65.1).

Based on the pretax and after-tax contributions, the Benefits Administrationapplication calculates the employee�s withholding amount to determine theemployee�s net pay. Type an amount of take home pay instead of the grossamount that an employee wants, and the Benefits Administration applicationcalculates the gross pay needed to cover the elected benefits.

STEPS To estimate take home pay1. Access Estimated Pay Calculation (BN66.1).2. From the Compensation section, Consider the following fields.



Pay Period GrossIncome

Type the employee�s gross income for one payperiod. To calculate the gross pay needed tocover the elected benefits, leave this field blank.Type the net income the employee wants in theEstimated Net Pay field.

NOTE If a benefit simulation is entered onElection Simulation (BN65.1), and you formtransfer to this form, this field may be populated.It can be overridden if desired.

Flex Credits Type the flex credits the employee receives eachpay period.

Benefit Credits Type the number of flex credits the employeereceived for electing benefits that cannot bespent on other benefits.

3. From the Spend section, Consider the following fields.

Pre-tax DollarsSpent

Type the employee�s pretax contribution forbenefits each pay period.


DefinedContributionSpend

Type the employee�s contribution to 401(k),403(b), and 457 plans each pay period.


4. From the Deductions section, Consider the following fields.

Federal In the first field, type the federal exemptions theemployee wants to use in the calculation. Inthe second field, Type the employee�s federalmarital status. If you leave these fields blank,the application uses the federal exemptions fromEmployee Taxes (PR13.1).

State In the first field, type the state exemptions theemployee wants to use in the calculation. In thesecond field, type the employee�s state maritalstatus. If you leave this field blank, the applicationuses the marital status from Employee Taxes(PR13.1) based on the employee�s resident state.


351

After-TaxDeductions

Type the after-tax deduction amount for each payperiod.


Other Deductions Type the total amount of any other deductions,such as union dues, that are taken for each payperiod.

5. Select the Special Actions, Calculate form function.

Forecasting Defined Contribution Account BalancesForecast the future account balance of a defined contribution plan based onan employee�s contributions and company match contributions. Comparedifferent future balances by assuming different contributions.



STEPS To forecast defined contribution account balances1. Access Defined Contribution Forecast (BN67.1).2. Consider the following fields.

Annual Salary If contributions are a percent of salary, type theemployee�s salary for the forecast.

Salary Increase Type a percent that the salary increases for eachyear of the forecast. For example, for 7% type7 in the field.

Current Balance To include the employee�s current accountbalance, type the employee�s account balance.

3. From the Annual Contribution section, consider the following fields.

Percent If the forecast is based on a contribution definedas a percent of annual salary, type the employeecontribution percent.

Amount If the employee�s annual contribution is a flatdollar amount, type the annual contribution.

Company Match If the company matches a percent of employeecontributions, type the match percent.

Limit If the plan has a company match limit that is apercent of an employee�s annual salary, type thatlimit.

4. From the Return section, Consider the following fields.

Rate of Return Type an average annual rate of return or theinterest rate of the investment. The rate of returncompounds annually.

Years Type the number of years of the forecast. Thisis a required field.

5. Choose the Special Action, Calculate form function.

Purging Benefit EnrollmentsPurge employee, COBRA participant, and retiree benefits and theirdeductions. Lawson recommends that you keep at least one year of benefithistory.

You have three ways to purge benefits.

� Purge all benefits, flex benefit records, employee deductions, and standardtime records under a flex plan for a specified flex plan year.

� Purge all non-flex benefit and deductions with a stop date that is equal toor earlier than a designated date.


353

� Purge all non-flex benefit and deductions in effect on a particular date.Lawson strongly recommends caution when using this option. This optionis designed to purge test data and as a result will purge benefits even ifpayroll history exists.

WARNING Purging records permanently removes them from theLawson database. You cannot retrieve purged information. It isstrongly recommended that you back up data, following yourorganization�s MIS procedures, before running any purge programs.

STEPS To purge benefit enrollments1. Access Benefit Purge (BN430).2. Consider the following fields.

Purge Thru Date Type a date to purge non-flex benefits with a stopdate equal to or earlier than this date.

As of Date Type a date to purge non-flex benefits in effecton this date.

CAUTION This option is designed to beused to purge test data only.

Benefit Type Type an X to include benefit plans of this kindfor purging. You must select at least one benefittype. If you are purging benefits under a flexplan, type an X in all Benefit Type fields.

Benefit types are as follows.� HL = Health� DN = Dental� DI = Disability� EL = Employee Life� DL = Dependent Life� DC = Defined Contribution� DB = Defined Benefit� VA = Vacation buy or sell� RS = Spending Account� SB = Saving Bond� SP = Stock Purchase

Termination Date Type a date to purge benefits for employees withtermination dates equal to or earlier than thisdate.



Report Option Select the value that indicates whether you wantto purge benefit records for employees, retirees,COBRA participants, or all benefit records. Thisis a required field.

Update Select the action you want to perform. Thisis a required field. If you select Report Only,the report lists, but does not purge the benefitinformation that you select for purging. If youselect Update, the report purges and lists thebenefit information that you select for purging.

Lawson recommends that you select Report Onlyto view the report before selecting Update.


Purging Invoices and PaymentsPurge invoice and payment records for COBRA participants and retirees.

Print invoices and update to the general ledger before purging. Apply andrelease payments before purging.

WARNING Purging records permanently removes them from theLawson database. You cannot retrieve purged information. It isstrongly recommended that you back up data, following yourorganization�s MIS procedures, before running any purge programs.

STEPS To purge invoices and payments1. Access Invoice, Payment Purge (BN480).2. From the parameter section, Consider the following fields.

Thru Date Type a date to purge invoices and paymentswith dates equal to or before this date. This is arequired field.

Update Select the action you want to perform. This isa required field. If you select Report Only, thereport lists, but does not purge the invoices orpayment. If you select Update, the report listsand purges the invoices or payments that youselect for purging.

Lawson recommends that you select Report Onlyto view the report before selecting Update



355

Appendix A

Report SamplesThe Benefits Administration application includes a number of reports andlistings that allow you to review your data. This appendix provides a briefdescription of the major reports and listings along with a sample of thereport output.

Employee Change Benefit Update (BN100)Run Employee Change Benefit Update (BN100) to automatically add,change, and terminate employee benefits based on changes made bypersonnel actions.

Figure 66. Form clip: Running Employee Change Benefit Update (BN100)

Benefits Administration User Guide Appendix A Report Samples 357

Figure 67. Report sample: Employee Change Benefit Update (BN100)602Hanson,Hannah

EffectiveDate02/09/98

ActionJOBCHG

Delete

UNIONS

FTHRBW

Add

FTSALBW

Change

Salary

Process

Plan

Start

Stop

Coverage

Contribution

DeductionError

-----------------------------------------------------------------------------------------------------------------------------

ChgStopHLHL1

HealthUnionan01/01/9602/28/98

PT

1000.00

9PH1

83.33

CO

500.00

9CH1

41.67

ChgAdd

HLHL1

HealthUnionan03/01/98

PT

900.00

9PH1

75.00

CO

600.00

9CH1

50.00

ErrChg

DIDI1

STDDisability

01/01/96

24,960.00CO

11.32

9CI1

.44ChangerulesnotdefinedforactionJOB


Mass Benefit Add (BN101)Run Mass Benefit Add (BN101) to list the employees who are eligiblefor plans.

Figure 68. Form clip: Running Mass Benefit Add (BN101)


Figure 69. Report sample: Mass Benefit Add (BN101)BN101Date09/25/00

Company4321TwoRiversCompany

Update

Page

1Time14:15

MassBenefitAdd

CalculationDate01/01/00

PlanType

DI

Disability

PlanCode

DI1

STDDisabilityDefault

Employee

Start

---Option----

Mult

Cov/PayPer

Sal/Annual

Pct/Amt

---------------------------------------------------------------------------------------------------------------------

28Andersen,IrisA

01/01/00

28900.00

38500.00

Amount

Contribution

Flex

Pre-Tax

After-Tax

Comp

13.09

Deduction

9CI1

.50

4002Angell,Michael

01/01/00

28100.00

37440.00

Amount

Contribution

Flex

Pre-Tax

After-Tax

Comp

12.73

Deduction9CI1

.49

2002Arc,LisaL

01/01/00

56300.00

75000.00

Amount

Contribution

Flex

Pre-Tax

After-Tax

Comp

25.50

Deduction

9CI1

.98

18Buttgling,KatherineA

01/01/00

10200.00

13520.00

Amount

Contribution

Flex

Pre-Tax

After-Tax

Comp

4.60

Deduction

9CI1

.18

4001Dahl,Karen

01/01/00

23400.00

31200.00

Amount

Contribution

Flex

Pre-Tax

After-Tax

Comp

10.61

Deduction


Plan Employee Update (BN102)Run Plan Employee Update (BN102) to update employee benefits for a planthat has coverage or contributions based on age or years of service.

Figure 70. Form clip: Running Plan Employee Update (BN102)


Figure 71. Report sample: Plan Employee UpdateBN102Date09/21/00


ReportOnly

Page

1Time13:25

PlanUpdate

CalculationDate10/01/00

PlanType

EL

EmployeeLife

PlanCode

EL1

EmployeeMultipleofLife

OriginalContributionAmounts

NewContributionAmounts

---------------------------------------------

---------------------------------------------

EmployeeName

Start

FlexAmt

Pre-Tax

Aft-TaxTotalAmt

Company

FlexAmt

Pre-Tax

Aft-TaxTotalAmt

Company

---------------------------------------------------------------------------

-----------------------------------------

500Johnson,MarkM

09/01/00

28.80

28.80

43.20

29.38

29.38

44.06

Deduction

1.11

1.66

502Morrison,Mathew

02/01/00

80.85

80.85

120.75

80.11

80.11

119.65

Deduction

3.11

4.64


Plan Update (BN105)Run Plan Update (BN105) to update all benefits for plans in which coverage,contributions, or general ledger overrides have been added or changed.

Figure 72. Form clip: Running Plan Update (BN105)


Figure 73. Report sample: Plan Update (BN105)BN105Date09/25/00


Update

Page

1Time14:28

PlanUpdate-Employees

EffectiveDate01/01/00

PlanType

HL

Health

PlanCode

HL1

HealthUnionandNonUnion

OriginalAmounts

NewAmounts

-------------------------------------------------------

-------------------------------------------------------

Employee

StartDt

CoverageFlexAmt

Pre-Tax

Aft-TaxTotalAmt

Company

CoverageFlexAmt

Pre-Tax

Aft-TaxTotalAmt

Company

-------------------------------------------------------------------

--------------------------------------------------

30001/01/97Ackner,AndrewM

1100.00

1100.00

800.00

1200.00

1200.00

850.00

Deduction

91.67

66.67

100.00

70.83

201/01/96Brown,JanB

900.00

900.00

600.00

1000.00

1000.00

650.00

Deduction

75.00

50.00

83.33

54.17

80301/01/96Espy,JohannaJ

1000.00

1000.00

500.00

1100.00

1100.00

550.00

Deduction

83.33

41.67

91.67

45.83


Life Insurance Reportable Income (BN150)Run Life Insurance Reportable Income (BN150) to calculate the cost ofexcess employee and dependent life insurance for each employee.


Figure 74. Report sample: Life Insurance Reportable Income (BN150)BN150Date09/25/00

Company

4321

TwoRiversCompany

ReportOnly

Page

1Time14:40

EmployeeLifeReportableIncome

ReportAsOf

08/01/00

Excess

CostOf

Pre-Tax

AfterTax

Reportable

Employee

Name

EmployeeLife

Excess

Premium

Premium

Income

---------

---------------------------------

--------------

------------

----------

----------

--------------

5Paynter,JordanR

20,000.00

2.20

2.80

303

Carter,ThomasM

110,000.00

18.70

10.27

8.43

500

Johnson,MarkM

90,000.00

9.90

5.60

4.30

502

Morrison,MathewL

55,000.00

9.35

6.74

2.61

503

Shandell,SharonM

40,000.00

6.80

5.78

1.02

750

Larson,PatriciaA

24,000.00

11.52

10.51

1.01

802

Smith,Elizabeth

150,000.00

175.50

69.67

105.83


Plan Parameter Listing (BN215)Run Plan Parameter Listing (BN215) to list parameters of one or morebenefit plans.


Figure 75. Report Sample: Plan Parameter Listing (BN215)BN215Date10/23/00

Company3004Sue’sQATestCompany

Page

1Time14:48

PlanParameterListing

PlanType

HL

Health

PlanCode

1BasicHealthplan(US)

Category

StartDate

01/01/99

StopDate

Parameters

----------

CoverageType

1CoverageOptions

ContributionType

1OptionsAmount

Default

AAlwaysDefault

Waive

No

Insurer

-------

Insurer

ContractNumber

International

-------------

Country

US

Currency

USD

Eligibility

-----------

EmployeesCovered

Yes

EmployeeGroup

ACTIVEFT

ActiveFullTimeEmployees

PostalCode

RetireesCovered

No

EmployeeGroup

COBRA(U.S.)Covered

Yes


Flex

----

FlexPlan

FlexCore

No

Deduction

BenefitPlanPayCode

TimeAccrualPlan

COBRAandRetireeAccounts

--------------------------

AccrualAccount

3004CORP

10100

Cash

AccountsReceivable

3004CORP

11400

AccruedDeductions

Expense

3004CORP

12500

I/CAccountsReceivable

FrequencyTable

1BasicTable

AmountDeductions

PercentDeductions

-----------------


Benefit Entry Rules Listing (BN216)Run Benefit Entry Rules Listing (BN216) to list a plan�s waiting periods, addrules, change rules, and termination rules.

370 Appendix A Report Samples Benefits Administration User Guide

Figure 76. Report sample: Benefit Entry Rules Listing (BN216)BN216Date09/25/00

Company4321

TwoRiversCompany

Page

1Time14:45

BenefitPlanRulesReport

PlanType

HL

Health

Plan

RuleType

AddRules

StartDate

01/01/97

EmployeeGroup

PersonnelAction

REHIRE

Eligibility

-----------

FromDate

AdjustedHireDate

Months

Days

30

Hours

PayClass

EntryType

NextEntryPoint

Points

------

01/0102/0103/0104/0105/0106/0107/0108/0109/0110/0111/0112/01

RuleType

AddRules

StartDate

01/01/97

EmployeeGroup

PersonnelAction

REHIRE<YR

Eligibility

-----------

FromDate

AdjustedHireDate

Months

Days

Hours

PayClass


Benefit Plan Status Report (BN220)Use Benefit Plan Status Report (BN220) to verify statuses of benefit plans.

Figure 77. Form clip: Running Benefit Plan Status Report (BN220)


Figure 78. Report sample: Benefit Plan Status Report (BN220)BN220Date09/25/00

Company4321

TwoRiversCompany

Page

1Time14:47

BenefitPlanStatusReport

BN105(PlanUpdate)Statuses

Plan

Start

Group

Record

Action

Type

Plan

Date

Name

Type

Needed

----

----

--------

----------

------------

--------

DC

401J

401kPlan

01/01/00

CONTRIBUTION

None

DI

DI1


01/01/99

COVERAGE

Update

01/01/00

COVERAGE

Update

DIJK

Joelyn’sDisability

01/01/00

CONTRIBUTION

None

01/01/00

COVERAGE

None

DL

DL1

DependentLife

01/01/00

CONTRIBUTION

Update

EL

AD&D

Accid.Death&Dismemberment

01/01/99

CONTRIBUTION

None

01/01/99

COVERAGE

None

EFLJ

FlexEmpLife

01/01/00

CONTRIBUTION

None

01/01/00

COVERAGE

None


Plan Participant Report (BN230)Run Plan Participant Report (BN230) to list the plan participants of a benefit.


Figure 79. Report Sample: Plan Participant Report (BN230)BN230Date09/25/00

Company

4321

TwoRiversCompany

Page

1Time14:49

PlanParticipantReport-Employee

BeginningDate01/01/00

BenefitType

Health

Plan

HL1


Start

Stop

Opt

Employee

Company

Match

Total

EmployeeName

Date

Date

Nbr

Coverage

Contribution

Contribution

UpTo

Contribution

---------------------------------------------------------------------------------------

--------------------

--------------

300

Ackner,AndrewM

01/01/00

2.000Employee+1

1,200.00

850.00

2,050.00

2Brown,JanB

01/01/00

1.000EmployeeOnly

1,000.00

650.00

1,650.00

803

Espy,JohannaJ

01/01/00

1.000EmployeeOnly

1,100.00

550.00

1,650.00

800

Forseth,BettyW

01/01/00

1.000EmployeeOnly

1,100.00

550.00

1,650.00

304

Freeman,LindaM

01/01/00

2.000Employee+1

1,300.00

750.00

2,050.00

602

Hanson,HannahH

01/01/00

1.000EmployeeOnly

1,000.00

650.00

1,650.00

302

Hanson,LukeD

01/01/00

5.000Employee+4

1,750.00

1,400.00

3,150.00


Employee Benefit Report (BN231)Run Employee Benefit Report (BN231) to list all benefits in which employeesare enrolled.


Figure 81. Report sample: Employee Benefit Report (BN231)BN231Date08/24/00

Company

4321

TwoRiversCompany

Page

1Time15:45

EmployeeBenefitReport

BenefitsDateRange01/01/98-12/31/98

Type

Plan

Description

StartDate

StopDate

Opt/Nbr

EmpElection

Comments

--------------------

----

------------------------------

----------

---------

-------

------------

--------

300

Ackner,AndrewM

DefinedBenefit

PENS

PensionDEFAULTALLEmployees

04/01/97

No

DefinedContribution

403B

403bPlan

04/01/97

01/31/98

2.00%

No

DefinedContribution

403B

403bPlan

02/01/98

2.00%

No

Disability

DI1


09/30/96

24750.00

No

EmployeeLife

EL2

EmployeeLifeFlatAmount

09/30/96

10000.00

No

Health

HL1


01/01/97

2Employee+1

No

SpendingAccount

RS2

DependentCareSpendingAcct

01/01/98

12/31/98

5000.00

No


Benefits Statement (BN232)Run Benefits Statement (BN232) to create personalized benefits statementsfor employees.


Figure 82. Report sample: Benefits Statement (BN232)PreparedFor:

3Smith,RandyD

Page

1

TwoRiversCompany

EmployeeBenefitsStatement

PreparedOn:

01/01/00

EmployeeLife/AD&DBenefits

------------------------------


Coverage:

BenefitOf

10,000.00

SummaryStatement

-----------------

BenefitType

PlanDescription

CompanyContribution

-----------------

------------------------------

--------------------

TotalCompanyContributions

0.00

2000AnnualSalary

75,000.00

--------------

TotalCompensation

75,000.00


Participation Report (BN236)Run Participation Listing (BN236) to list the plan participants of definedcontribution and defined benefit plans.


Figure 83. Report sample: Participation ReportBN236Date09/25/00

Company

4321

TwoRiversCompany

Page

1Time15:01

ParticipationListing-DefinedContribution

PlanYear

1998

Plan

403B

403bPlan

Start/StopDate

01/01/80

HoursOfService:

Required

0Minimum

0Vesting

0

MeetRequiredHoursOfService-EligibleForContribution

DateOf

-----ServiceRequirements-----

Employee

Name

Birth

Age

EntryDate

Months

Hours

ActiveLastDay

Compensation

---------

-------------------------------------------

---

----------

------

-------

---------------

--------------

2Brown,JanB

05/13/1964

36

07/01/81

12

300.00

YES

3,300.00

201

Walterson,AnthonyT

01/20/1961

39

06/01/96

12

160.00

YES

5,153.84

203

Holmer,JohnD

04/06/1960

40

06/01/96

12

240.00

YES

3,692.31

211

Schumacher,AdamR

11/15/1973

26

11/01/96

12

280.00

YES

3,150.00

212

Petra,KimberlyA

08/20/1972

28

05/01/96

12

250.00

YES

2,805.00


One Page Benefit Statement (BN242)Run One Page Benefits Statement (BN242) to create benefits statements thatestimate the total cost of an employee�s benefits.


Figure 84. Report sample: One Page Benefits Statement1998

BenefitsStatement

300

AndrewM.Ackner

SocNbr

450-98-0009

445MainStreet

Birthdate

07/14/73

HireDate

09/30/96

Minneapolis

MN55413

Yourestimatedannualbenefitcostfor1998is

$961.22.Thefollowing

summarystatementhasbeenpreparedforyoutoshoweachbenefitcost.

Actualvalueswereusedwhenpossiblewhileotheramountswereestimated.

MEDICALANDDENTALBENEFITS:

COMPANYCOST

YOURCOST

---------------------------

------------

---------


Employee+1

$800.00

$1,100.00

INCOMEPROTECTIONBENEFITS:

--------------------------


$10,000.00

$150.00


$11.22


Benefit Election Form (BN245)Run Benefit Election Form (BN245) to create benefit election or confirmationforms for employees.


Figure 85. Report sample: Benefit Election Form (BN245)BenefitElectionForm

Page

1

Company

4321

TwoRiversCompany

Employee

1Albrit,TinaK

SocialNbr

475-88-9632

Birthdate07/10/75

Hire,AdjustedHireDate

07/12/84

07/12/84

AgeDate

Age

Anniversary,SeniorityDate07/12/84

07/12/84

BenefitsDate1-5

EmployeeStatus

AP

ActivePart-time

PayFrequency

2Biweekly

TrueMaritalStatus

SSingle

ProcessLevel

HDQTR

TwoRiversHeadquarters

Department

ADMIN

Administration

UserLevel

LocationCode

Supervisor

HRDIRECT

HRdirector

MailGroup

MailBoxNbr

Home,WorkPhone,Ext

612

588-9635

8885

SpouseEmployer

SpouseAddress1

SpouseAddress2

SpouseAddress3

SpouseAddress4

CityorAddress5

StateorProvince,Zip

Country

ExpenseAccount

4321102

51080

Activity

Current,NewElectionDate

12/31/98

01/01/99


Flex Missing Benefits Report (BN246)Run Flex Plan Participant Errors (BN246) to list employees whose benefitshave not been completely added for the flex plan year.


Figure 86. Report sample: Flex Missing Benefits Report (BN246)BN246Date09/25/00

Company

4321

TwoRiversCompany

Page

1Time15:04

FlexMissingBenefitsReport

PlanYear-01/01/00

FlexPlan

JKFL

Joelyn’sFlex

Employee

Name

OpenBenefitTypes

---------

-------------------------------------------------

------------------------------------------

4001

Dahl,Karen

DN

DL

DB

SB

SP

4002

Angell,Michael

DN

DL

DC

DB

RS

SB

SP

4003

Simmons,Christine

DL

DC

DB

RS

SB

SP


Monthly Premium Report (BN320)Run Monthly Premium Report (BN320) to review monthly billings. Createfour kinds of reports: a premium report, an exception report, a summaryreport, and a combination of all three. Select which report you need in theReport Option field.

The following report samples display a premium report, an exception reportand a summary report.

Figure 87. Form clip: Running Monthly Premium Report (BN320)


Figure 88. Report sample: Premium Report from Monthly Premium Report (BN320)BN320Date09/25/00

Company

4321

TwoRiversCompany

Page

1Time15:06

MonthlyPremiumReportForDecember

1999

PremiumReport-Employees

BenefitType

Health

Plan

HL1


EmployeeGroup

Date

01/01/96

DateOf

Effective

Employee

Company

Total

Employee

Name

Birth

Smk

Date

Coverage

Premium

Premium

Premium

-----------------------------------------------------

--------------------------------------------------------------------

2Brown,JanB

05/13/64

01/01/96

EmployeeOnly

75.00

50.00

125.00

5Paynter,JordanR

07/28/65

01/01/99

EmployeeOnly

75.00

50.00

125.00

201

Walterson,AnthonyT

01/20/61

01/30/96

Employee+3

125.00

100.00

225.00

300

Ackner,AndrewM

07/14/73

01/01/97

Employee+1

91.67

66.67

158.34

302

Hanson,LukeD

08/28/53

01/01/96


Figure 89. Report sample: Exception Report from Monthly Premium Report (BN320)BN320Date09/25/00

Company

4321

TwoRiversCompany

Page

1Time15:06


1999

Exceptionreport(EmployeeTerminations)

BenefitType

Health

Plan

HL1


EmployeeGroup

Date

01/01/96

DateOf

Effective

Employee

Company

Total

Employees

Name

Birth

Smk

Date

Coverage

Premium

Premium

Premium

-----------------------------------------------------

-----------------------------------

----------------------

-----------

2Brown,JanB

05/13/64

12/31/99

EmployeeOnly

75.00

50.00

125.00

5Paynter,JordanR

07/28/65

12/31/99

EmployeeOnly

75.00

50.00

125.00

201

Walterson,AnthonyT

01/20/61

12/31/99

Employee+3

125.00

100.00

225.00

300

Ackner,AndrewM

07/14/73

12/31/99

Employee+1

91.67

66.67

158.34

302

Hanson,LukeD

08/28/53

12/31/99

Employee+4

141.67

116.67

258.34

500

Johnson,MarkM

02/01/63

12/31/99


Figure 90. Report sample: Summary Report from Monthly Premium Report (BN320)BN320Date09/25/00

Company

4321

TwoRiversCompany

Page

1Time15:06


1999

SummaryReport

BenefitType

Health

Plan

HL1


EmployeeGroup

Date

01/01/96

Employees

Number

Employee

Company

Total

Coverage

Covered

Premium

Premium

Premium

---------------

-------

---------------------------------------

EmployeeOnly

7525.00

350.00

875.00

Employee+1

191.67

66.67

158.34

Employee+3

2250.00

200.00

450.00

Employee+4

1141.67

116.67

258.34

Retirees

Number

Employee

Company

Total

Coverage

Covered

Premium

Premium

Premium

---------------

-------

---------------------------------------

EmployeeOnly

18.33

116.67

125.00

Employee+1

116.67

141.67

158.34

FullFamily

150.00

258.33

308.33


DC Plan Contributions (BN330)Run DC Plan Contributions (BN330) to list investment amounts for definedcontribution plans.


Figure 91. Report sample: DC Plan Contributions (BN330)BN330Date09/07/00

Company4321

TwoRiversCompany

Page

1Time11:09

DCPlanContributions

PayrollPaymentDates01/01/98-12/31/99

Plan

403B

403bPlan

Employee

Name

Percent

Pre-Tax

After-Tax

Company

Total

---------

--------------------------------------------------

------------

------------

------------

-------------

300

Ackner,AndrewM

76.14

0.00

.25

76.39

GuaranteedFund

100.00

76.14

0.00

.25

76.39

520

Anderson,JulieA

115.20

0.00

.79

115.99

Undistributed

100.00

115.20

0.00

.79

115.99

2Brown,JanB

58.00

8.00

.20

66.20

GuaranteedFund

42.37

24.00

4.00

.05

28.05

MutualFund

42.37

24.00


Appendix B

Benefit System Logic Calculations

Benefits Administration User Guide Appendix B Benefit System LogicCalculations

395

Calculating Annual and Hourly Pay RatesThis section explains the following calculations:

� "Calculating Annual Salary for an Hourly Employee" on page 396

� "Calculating Hourly Rate for a Salaried Employee" on page 396

Calculating Annual Salary for an Hourly EmployeeThe Benefits Administration application calculates an annual salary for anhourly employee for the following reasons:

� To calculate the annual salary for coverage, contribution, and flex dollarcalculations

� To calculate limits for plans with the contribution types contribution limits,match limit schedule, and match percent schedule

�

To calculate the annual salary for an hourly employee, the BenefitsAdministration application uses the following equation:

Figure 91. Report sample: DC Plan Contributions (BN330)

salary Annual = hours Annual FTE code Job rateHourly

How the Benefits Administration application determines the hourly rate, jobcode FTE, and annual hours depends on whether these values are current orif they are based on an as of date or the first of the month.

If these values are current, the hourly rate and job code FTE are fromEmployee (HR11.1); the annual hours figure is from Job Code (HR06.1) or, ifthe employee is not assigned a job code, from Company (HR00.1).

If these values are based on an As of date or the first of the month, thesevalues are based on history files.

Calculating Hourly Rate for a Salaried EmployeeThe Benefits Administration application calculates an employee�s hourly rateto determine the value of each vacation hour for flex vacation plans in whichan employee can buy or sell vacation hours.

The Benefits Administration application calculates the employee�s hourlyrate as follows:

396 Appendix B Benefit System Logic Calculations Benefits Administration User Guide

1. If the flex vacation plan is based on a salary other than the employee�s flexsalary, the Benefits Administration application annualizes the employee�spay rate. For more information, see �"Calculating Annual Salary for anHourly Employee" on page 396.�

If the flex vacation plan uses the employee�s salary used for flexcalculations in Employee Flex Credits (BN45.1), the applicationdetermines which salary is used based on the parameters defined forthe flex vacation plan in the Flex Salary Parameters subform on FlexCredits (BN08.1).

2. The Benefits Administration application calculates the cost of a vacationhour using the following equation:

hour vacation one ofCost =Cost hours Annual FTE code Job

salary Annual

The Cost figure is from the Misc. form tab on Benefit Plan (BN15.1).


397

Company Match CalculationsThis section explains how the Benefits Administration application createscompany match deductions and how the deduction is calculated. Twocontribution types create company match deductions:

� Match limit schedule and

� Match percent schedule

Each contribution type works differently. For the match limit schedule, theBenefits Administration application creates the deduction without any specialcalculations. The application creates the deduction taking the values directlyfrom the schedule. The Payroll application performs calculations that areunique to these benefits deductions to determine the amount of the deductionin each payroll cycle.

For the match percent schedule, the Benefits Administration applicationperforms unique calculations to determine the values to be used when thededuction is created. The Payroll application handles the deduction like allother payroll deductions.

Company Match Deduction Creation for Match LimitSchedules

How the Benefits Administration application creates the company matchdeduction depends on the plan�s contribution schedule, which is defined onMatch Limits Schedule (BN18.6). Based on the years-of-service range theemployee is part of, the Benefits Administration application uses the figuresdirectly from the contribution schedule for the company match deductionit creates.

The following examples at ABC Foods are based on the following contributionschedule.

Years Match percent Up to $Amount1-4 25% 5% $1,000.00

5-99 50% 10% $2,000.00

Mary has two years of service. The deduction is created in PR14.1 (EmployeeDeduction) like this:

Amount orpercent

Up to Balance type Balance

25.00 5.00 D $1,000.00

Bob has 15 years of service. The deduction is created like this:


Amount orpercent


50.00 10.00 D $2,000.00

If the employee�s contribution is split between pretax and after-tax, and thecompany matches both types of contributions, the match is prorated.

For example, Joe has ten years of service and contributes 10% pretax and5% after-tax. Two company match deductions are created as follows.

Pretax company matchAmount orpercent


50.00 6.67 D $1,333.33

After-tax company matchAmount orpercent


50.00 3.33 D $666.67

The calculation for the company match deduction as defined on Deduction(PR05.1) is Percent of Employee Deduction. The Up To field can be viewedonly through drill around.

Payroll Calculation for Match Limit DeductionsTo calculate the company match deduction, the Payroll application determinesif the employee�s contribution is greater than the Up To percent defined asthe limit of the company match on Match Limit Schedule (BN18.6). If thecontribution does not exceed the Up To percent, the match is calculatedbased on the employee�s deduction amount. If the contribution exceedsthe Up To percent, the percent limit is calculated and the company matchdeduction based on the reduced amount.

If the employee contributes a flat amount (instead of a percent), the Payrollapplication first calculates the percent the employee is contributing using thefollowing equation.

percenton contributi sEmployee' = 100 pay sEmployee'

deduction sEmployee'

For example:

Vinnie�s pay is $1,600.00. His deduction amount is $22.13, so he iscontributing 1.383% of his pay ($22.13/$1,600.00 * 100 = 1.383).


399

The Payroll application determines the company�s contribution amount asfollows:

� If the employee�s percent contribution is equal to or less than the Up Toamount, the company match calculates as follows:

Employee�s contribution * Match% = Company match

At ABC Foods, if an employee�s contribution is up to 5%, the company matchis 50% of the employee�s contribution.

For example:

Sheila�s pay is $1,600.00.

She contributes three percent of her pay, which is $48.00 ($1,600.00 * 0.03).

The company match is $24.00 ($48.00 * 0.50).

� If the employee�s contribution is greater than the Up To amount, the com-pany match calculates as follows:

(Employee�s pay * Up To percent) * Match% = Company match)

At ABC Foods, if an employee�s contribution exceeds 5%, the Payrollapplication calculates 5% of the employee�s pay and calculates the company�scontribution as 50% of that amount. For example:

Tony�s pay is $1,600.00.

He contributes 7% of his pay, which is $112.00 ($1,600.00 * 0.07).

Because Tony�s contribution exceeds 5% of his pay, the Payroll applicationcalculates 5% of Tony�s pay, which is $80.00 ($1,600.00 * 0.05).

The company match is $40.00 ($80.00 * 0.50).

In the above example, if the employee contribution is an amount, rather thana contribution of 7%, the employee contribution would be a flat amount of$112.00 each pay period, and the application would have calculated whatpercent the contribution is.

If there is a dollar amount limit, the company match stops when thedescending balance = $0.00.

Company Match Deduction Creation for Match PercentSchedules

How the Benefits Administration application creates the company matchdeduction depends on the plan�s contribution schedule, which is defined onMatch Percent Schedule (BN18.7) and the match calculation described below.

To determine the company match amount, the Benefits Administrationapplication finds the employee�s contribution percent on the schedule. If theemployee contributes a flat amount instead of a percent, the applicationdetermines the percent of the employee�s contribution, using the followingequation:


oncontributipercent sEmployee' = 100 Salary Annual sEmployee'

oncontributi sEmployee'

For example:

Bart�s annual salary is $40,000.00 based on the salary definition on thecontribution.

His flat amount contribution is $4,500.00, so he is contributing 11.25% ofhis salary ($4,500.00/$40,000.00 * 100 = 11.25).

Calculations Based on the Type of MatchCalculationThe type of match is defined by the Match Calc tab on Match PercentSchedule (BN18.7). There are two types of match calculations:

� Fixed The company match is determined using only the values from thedetail line that contains the percent the employee elected.

� Cumulative The company match is determined using the values of all con-tribution levels up to and including the detail line that contains the percentthe employee elected.

Company Match Deduction Creation for FixedMatch CalculationThe schedule would look like this:

Percent Match percent Amount0-4 50.00* $500.00

5-10 25.00* $1,000.00

* This field can be defined as 50% or 5% depending upon the CalculationType on the deduction in Deduction (PR05.1). For more information, see"How do I Define Benefit Contributions?" on page 149.

The deduction is created in Employee Deduction (PR14.1) as follows:

Niki contributes 3%, which is within the first range on the schedule (between0% and 4%). The company match deduction is created as follows:

Amount or percent Balance type Balance50.00 D $500.00

Mike contributes 7%, which is within the second range on the schedule(between 5% and 10%). The company match deduction is created as follows:

Amount or percent Bal. type Balance25.00 D $1,000.00


401

Payroll Calculation for Fixed Match CalculationDeductionsThe following examples illustrate payroll calculation for fixed match calculationdeductions.

The way you set up the deductions affects the deduction calculations. Forthese examples, the calculation type came from Deduction (PR05.1).

Deductions with Calculation Type of Percent of Employee De-duction� Niki�s 3% contribution is calculated as follows:

$1,000.00 * 0.03 = $30.00

The company match is 50% of her deduction of $30.00 or $15.00.

(30.00 * 0.50 = 15.00)

� Mike�s 7% contribution is calculated as follows:

$1,500.00 * 0.07 = $105.00

The company match is 25% of his deduction of $105.00 or $26.25

($105.00 * 0.25 = $26.25)

Deductions with Calculation Type of Percent� Niki�s 3% contribution is calculated as follows:

$1,000.00 * 0.03 = $30.00.

The company match is 3% of her pay or $30.00 ($1,000.00 * 3.00 =$30.00)

� Mike�s 7% contribution is calculated as follows:

$1,500.00 * 0.07 = $105.00.

The company match is 5% of his pay or $75.00 ($1,500.00 * 5.00 =$75.00)

Company Match Deduction Creation for CumulativeMatch CalculationsThe schedule would look like this:

Percent Match percent Amount0-4 100.00 $500.00

5-8 50.00 $1,000.00

9-15 25.00 $1,500.00

The deduction is created in Employee Deduction (PR14.1) as follows:

� Robin contributes 3%, which is within the first range on the schedule (be-tween 0% and 4%). The company match deduction is created as follows:


Amount or percent Balance type Balance

3.00 D $500.00

The amount or percent is calculated as 3% * 100 = 3.

� Walter contributes 7%, in second range on the schedule (between 5-8).The company match deduction is created as follows:


5.50 D $1,000.00

The amount or percent calculates as follows:

(4% * 100.00 = 4%) + (3% * 50 = 1.5%) = 5.50%

� Fred contributes 11%, in the third range on the schedule (between 9% and12%). The company match deduction is created as follows:


6.75 D $1,500.00

The amount or percent calculates as follows:

(4% * 100.00 = 4%) + (4% * 50 = 2.00%) + (3% * 0.25 = 0.75%) = 6.75%

Payroll Calculation for Cumulative MatchCalculation DeductionsThe following examples illustrate payroll calculation for cumulative matchcalculation deductions. All of these deductions should have a calculation typeof percent on Deduction (PR05.1).

� Robin�s 3% contribution is calculated as follows:

The company match is 3% of her pay or $30.00 ($1,000.00 * 0.03 =$30.00)

� Walter�s 7% contribution is calculated as follows:

The company match is 5.5% of his pay or 82.50 ($1,500.00 * 0.055 =$82.50).

� Fred�s 11% contribution is calculated as follows:

The company match is 6.75% of his pay or $135.00 ($2,000.00 * 0.0675= $135.00).


403

Calculating the Cost of Excess LifeInsurance

The following sections explain how the Benefits Administration applicationcalculates the cost of excess life insurance.

Determining Which Plans Are ReportableThe Reportable field, located on BN15.1 (Benefit Plan), indicates whetheran employee or dependent life plan is included in the cost of excesslife insurance. If the Reportable field is Yes, the Benefits Administrationapplication includes coverage under the plan in the cost of excess lifeinsurance.

Determining Who Is CoveredIn the report parameters of Life Insurance Reportable Income (BN150), youindicate the date for which the report is being run. BN150 uses all benefits ineffect on that date.

To determine whether a plan covers employees or dependents, the BenefitsAdministration application uses the Covered field on Coverage Amounts(BN17.3). The field indicates who is covered in a life plan.

Determining Which Plans Cover an EmployeeEmployees are covered under all employee life plans in which the Coveredfield is Employee.

Determining Which Plans Cover Dependents andSpousesIf the Covered field is either Spouse or Both Spouse and Dependents for adependent life plan, spouses are covered under that plan. If the Covered fieldfor a plan is either Dependents or Both Spouse and Dependents, dependentsare covered in that plan.

Determining Which Dependents Are Covered ina Reportable PlanThe Spouse or Dependent field determines whether a dependent inDependent (HR13.1) receives spouse or dependent coverage.

How the Benefits Administration application determines which dependentsare covered in dependent life plans depends on whether the BenefitsAdministration application tracks dependent coverage in those plans. If the


Dependent Life field on Benefits Company (BN00.1) is Yes, the BenefitsAdministration application tracks dependent coverage in dependent life plans.

If the Benefits Administration application tracks dependent coverage, theDependent Benefits subforms on HR13.1 or on benefit entry forms indicatewhich dependents are covered under an employee�s health, dental, anddependent life benefits. Life Insurance Reportable Income (BN150) usesdependent benefits in effect on the date for which the report is being run.

If the Benefits Administration application does not track dependent coverage,the application uses the Life field in HR13.1 to determine whether thedependent is covered in a reportable life insurance plan.

Determining the Value of Excess CoverageTo determine the value of excess coverage for an employee, the BenefitsAdministration application performs separate calculations for the employeeand the employee�s dependents.

To determine the value of an employee�s excess coverage, the BenefitsAdministration application uses the larger result from either of the followingtwo calculations.1. Cost factor from group life W-2 table

To determine an employee�s excess coverage amount, the BenefitsAdministration application adds the coverage amounts for reportable lifeinsurance benefits that cover the employee. The application includes allbenefits in effect on the parameter date.

From this amount, the application subtracts the excludable amount of lifeinsurance which is defined on the Exclusions: Employee Life field onGroup Life W-2 Table (BN00.4).

The result is the employee�s amount of excess coverage for the reportingperiod.

To determine the value of excess life insurance, the BenefitsAdministration application performs a calculation based on the valueselected in the Frequency field on Life Insurance Reportable Income(BN150). This calculation uses two values from Group Life W-2 Table(BN00.4), the amount in the Monthly Cost Per field and the costassociated with the employee�s age.a. If the Frequency field on BN150 is Monthly, the cost of excess life in-

surance is calculated as follows:

Excess Coverage X Cost for employee�sage group

Monthly Cost Per

b. If the Frequency field on BN150 is Annual, the cost will be multipliedby 12:


405

ExcessCoverage

X 12 X Cost foremployee�sage group

MonthlyCost Per

c. If the Frequency field on BN150 is Pay Period, the cost will bemultipliedby 12 and divided by the employee�s pay frequency:

ExcessCoverage

X 12 X Cost foremployee�sgroup

MonthlyCost Per

PayFrequency

The value of excess life insurance is based on the employee�s age asof December 31 of the year specified in the As of Date.

2. Pretax cost

The Benefits Administration application determines the amount of pretaxdollars the employee paid for all reportable life insurance benefits asfollows:� The Benefits Administration application adds the pretax contribution

for all reportable life insurance benefits, resulting in the annual pretaxcost.

� If the Frequency field is Monthly, the annual pretax cost is divided bytwelve, resulting in the monthly pretax cost.

� If the Frequency field is Pay Period, the pretax cost is divided by theemployee�s pay frequency (12, 24, 26 or 52), resulting in the pay periodpretax cost.

From whichever amount is greater from calculations 1 and 2, the applicationsubtracts the amount of after-tax dollars the employee paid for all reportablelife insurance benefits.

The result is the employee�s reportable amount of excess life insurancefor one month.

Determining the Cost of Excess DependentCoverageTo determine the cost of an employee�s excess dependent coverage, theBenefits Administration application uses the larger result from the eitherof the following two calculations.


1. Cost from group life W-2 table

For each dependent, the Benefits Administration application adds thecoverage amount for all reportable life insurance benefits that cover thedependent. The application compares this amount with the excludableamount of life insurance, which is defined on the Exclusions: DependentLife field on Group Life W-2 Table (BN00.4). If the reportable life insuranceamount is greater than the excludable amount, the application uses theentire reportable life insurance amount as the excess coverage amount.

The result is each dependent�s amount of excess coverage for one month.

To determine the cost of excess life insurance for each dependent, theBenefits Administration application performs the following calculations.a. Calculates the cost for each dollar of excess coverage based on the

value of the Frequency field in Life Insurance Reportable Income(BN150) and the Monthly Cost Per field in BN00.4.� If the Frequency field is Monthly, the cost for each dollar of excess

coverage equals the value in the Monthly Cost Per field.� If the Frequency field is Annual, the Monthly Cost Per field is mul-

tiplied by 12 to annualize the monthly cost.� If the Frequency field is Pay Period, the Monthly Cost Per field is

multiplied by 12, then divided by the employee�s pay frequency (forexample, 12, 24, 26, or 52).

The result is cost per dollar of coverage for the year, month,or pay period.

b. Calculates the cost of excess life insurance based on the followingequation:

insurance life

excess ofCost =

group age

sdependent'for Cost

coverage ofdollar each for Cost coverage Excess

The application totals the cost for each dependent.

The result is annual, monthly, or pay period cost of reportable excesslife insurance for the employee�s dependents.

2. Pretax cost

The Benefits Administration application determines the amount of pretaxdollars the employee paid for all reportable dependent life insurancebenefits as follows:� The Benefits Administration application adds the pretax contribution for

all reportable dependent life insurance benefits, resulting in the annualpretax cost.

� If the Frequency field is Monthly, the annual pretax cost is divided bytwelve, resulting in the monthly pretax cost.

� If the Frequency field is Pay Period, the pretax cost is divided by theemployee�s pay frequency (12, 24, 26 or 52), resulting in the pay periodpretax cost.


407

From whichever amount is greater from calculations 1 and 2, the applicationsubtracts the amount of after-tax dollars the employee paid for all reportabledependent life insurance benefits.

The result is the reportable amount of excess life insurance for one month forthe employee�s dependents.

An Example of Calculating the Cost of Excess Life InsuranceABC Foods uses the following group life W-2 table on Group Life W-2 Table(BN00.4).

Neil, an employee at ABC Foods, is 41 years of age, and has $90,000 ofcoverage under an employee life plan. He pays for all his insurance ona pretax basis under a flex plan.

Neil has a spouse (Sarah) and two dependents (Karen and Bob) who arecovered under ABC Food�s dependent life plan. Sarah, who is 42 years ofage, is covered under a spouse life plan for $10,000, while Karen and Bob,who are 13 and 16 years of age, are covered under a dependent plan for$5,000 each.

ABC Foods ran Life Insurance Reportable Income (BN150) to calculatemonthly cost of excess life insurance. That is, when they ran BN150, theyselected Monthly in the Frequency field.

Calculating Neil�s Reportable Life Insurance for NeilTo calculate Neil�s reportable life insurance, the Benefits Administrationapplication uses the greater of the following two calculations.1. Using the group life W-2 table, the Benefits Administration application cal-

culates the amount of Neil�s reportable life insurance as follows:� Neil has $40,000 ($90,000 - 50,000) in excess coverage.� The cost of his excess life insurance is $4.00 ($40,000/1,000 * 0.100).

2. The total pretax premium for Neil�s employee life plan for one month is$13.89.


Because Neil�s pretax premium is greater than the cost calculated from thegroup life W-2 table, the Benefits Administration application uses the pretaxpremium as the cost of Neil�s reportable life insurance.

Calculating the Reportable Life Insurance for Sarah,Karen, and BobTo calculate the reportable life insurance for Neil�s dependents, the BenefitsAdministration application uses the greater of the following two calculations.1. Using the group life W-2 table, the Benefits Administration application cal-

culates the amount of reportable life insurance for Neil�s dependents asfollows:� Sarah has $10,000 ($10,000 is greater than $2,000) in excess cover-

age.� The cost for her excess life insurance is $1.00 ($10,000/1,000 * 0.10).� Karen and Bob each have $5,000 ($5,000 is greater than $2,000) in

excess coverage.� The cost for each of their excess life insurance is $0.30 ($5,000/1,000

* 0.08).

The total cost of life insurance for Sarah, Karen, and Bob is $1.60($1.00 + 0.30 + 0.30).

2. The total pretax premium for Neil�s dependent life plan for one month is$3.54.

Because the pretax premium is greater than the cost calculated from thegroup life W-2 table, the Benefits Administration application uses the pretaxpremium as the cost for Neil�s dependent life insurance.

The ResultThe total cost of Neil�s excess life insurance, including his spouse anddependents, for one month is $17.43 ($13.89 + 3.54).


409

Calculating COBRA Excess PremiumAmounts

The application calculates the administrative fee or excess premium amountfor COBRA contributions as follows:1. Determine the excess premium percent. If the Premium Percent field on

COBRA Parameters(BN00.2) is 100 percent or greater, the applicationsubtracts 100 from the value of the Premium Percent field.

For example, if the Premium Percent field is 102.00, the excess premiumpercent is 2.00 (102.00 - 100).

If the Premium Percent field on BN00.2 is 100 percent, the applicationdoes not calculate the excess premium.

2. Determine the cost for each percent. The application divides the annualCOBRA participant contribution by the value of the Premium Percent field.

For example, if the annual contribution is $280.00, the cost for eachpercent is $2.75 ($280/102.00).

3. Determine the excess premium amount. The application multiplies the costfor each percent by the excess premium percent.

The excess premium amount of the example is $5.50 ($2.75 * 2).

The application posts the administration fee to the excess premiumaccount selected on COBRA Parameters (BN00.2).


Appendix C

Benefit System Logic Information

Benefits Administration User Guide Appendix C Benefit System LogicInformation

411

Tracking Flex CreditsThe Benefits Administration application uses standard time records anddeductions to track flex credits.

Standard Time RecordsA standard time record represents an employee�s flex credits that are addedto his or her taxable wages.

If the flex plan lets employees add unspent flex credits to their taxable wages,the Benefits Administration application creates or updates standard timerecords for each employee when the Benefits Administration applicationcreates flex credits for the employee on Employee Flex credits (BN45.1) orFlex credits Calculation (BN145) and when the employee enrolls in a benefitwith a negative premium. A negative premium indicates that an employeereceives flex credits for electing the benefit.

If the flex plan does not let employees add unspent flex credits to their taxablewages, the Benefits Administration application does not create standardtime records.

Each employee under a flex plan can have either

� One standard time record that represents all flex credits that are added tothe employee�s taxable wages

� Multiple standard time records that represent the flex credits the employeereceives for each benefit with a negative premium

The number of standard time records an employee can have depends onwhether a flex pay code has been assigned to each benefit plan. If eachbenefit plan is assigned a flex pay code, each benefit creates a standard timerecord. If a flex pay code is assigned only to the flex plan, each employee hasonly one standard time record that is updated for all flex credits received.

The amount of the standard time record calculates as follows:

periodpay each for wages

taxable toadded creditsFlex =

frequencypay semployee' ofDivisor

dollars axable Unspent t* creditsflex Annual

The divisor of the employee�s pay frequency is from the flex plan�s frequencytable.

The Unspent Taxable Dollars is from Flex Credits (BN08.1) and determines thepercent of an employee�s flex credits that can be added to his or her payment.For example, if a plan lets each employee keep half of his or her unspent flexcredits, the value of the Unspent Taxable Dollars field is 50 percent.

When employees have used all of their flex credits that can be added totaxable wages, the Benefits Administration application deletes the employee�sstandard time record.

412 Appendix C Benefit System Logic Information Benefits Administration User Guide

If the Unspent Taxable Dollars field is zero, the Benefits Administrationapplication does not create standard time records for employees becausethey lose any of their unspent flex credits.

DeductionsDeductions track employee and company premiums. Flex plans use fourkinds of deductions: flex company, pretax, after-tax, and company.

Flex company Used if an employee spends flex credits to purchase a benefit.The flex company deduction has no effect on an employee�s taxable wages,and can be printed on employee payments to show how flex credits wereused.

Pretax Used if an employee spends pretax dollars to purchase a benefit.

For a flex plan in which an employee can spend flex credits, a pretaxdeduction is created after the employee has spent all of his or her flex credits.

For a flex plan in which an employee does not spend flex credits, a pretaxdeduction is created for any benefit with a positive employee cost.

After-tax Used if an employee spends after-tax dollars to purchase a benefit.

The Benefits Administration application creates an after-tax deduction forbenefits with an employee cost when flex and pretax dollars have been spent.

Company Used to track the company�s cost of benefits in addition to,or instead of, flex credits.

Kinds of Flex PlansHow the Benefits Administration application tracks flex credits depends onthe kind of flex plan you define. To illustrate how the Benefits Administrationapplication tracks flex credits, the following sections show three examples offlex plans at ABC Foods. However, you are not limited to these three kinds.You can create combinations of these kinds.

Flex Plan 1 Example� Gives employees flex credits before they elect benefits. The flex credits

can be used to purchase benefits.

� Creates one standard time record for each employee using the flex plan�sflex pay code.

� Reduces available flex credits when employees elect benefits.

� Shows only the net gain from benefit elections on employee paymentswhen an employee receives more flex credits than he or she has spent.

� Uses flex company deductions to show spent flex credits on payments.

To create the first flex plan, ABC Foods assigned a flex pay code only to theflex plan. A flex company deduction is assigned to each benefit plan.


413

Employees in ABC Food�s first flex plan can keep half of their unspent flexcredits.

Creating flex credits for EmployeesWhen ABC Foods runs BN145 (flex credits Calculation), the BenefitsAdministration application creates flex credits for each employee based onthe flex credit and pretax parameters on BN08.1 (flex credits). BN145 createsflex credits for every employee in the flex plan.

Because employees can add half of their unspent flex credits to theirpayments (that is, the Unspent Taxable Dollars field on BN08.1 is 50.00), theBenefits Administration application creates a standard time record for eachemployee who receives flex credits. The Benefits Administration applicationcreates the standard time record using the flex plan�s flex pay code.

Enrolling Employees in BenefitsBenefits in this kind of flex plan all have positive premiums. When you enrollan employee in benefits, the Benefits Administration application spends flexcredits first, then pretax dollars. When all flex and pretax dollars are spent,the Benefits Administration application spends after-tax dollars.

When an employee spends flex credits to pay for a benefit, the BenefitsAdministration application

� Reduces the employee�s available flex credits

� Reduces the employee�s standard time record (the standard time record isdeleted when the employee uses all of his or her flex credits)

� Creates a flex company deduction for the cost of the benefit

When all flex credits are spent and the employee uses pretax dollars to payfor a benefit, the Benefits Administration application

� Reduces the employee�s available pretax dollars and

� Creates a pretax deduction for the employee for the cost of each benefit

When the employee has spent all of his or her pretax dollars and theapplication uses after-tax dollars to pay for a benefit, the application

� Creates an after-tax deduction for the cost of the benefit

ExampleSusan, an employee of ABC Foods, receives $1,000 flex credits and has apretax limit of $5,000 which she can spend on benefits.

The Benefits Administration application creates a standard time record forSusan for $9.62 ($1,000 * 0.50/52).

If Susan did not elect any benefits, she would receive $9.62 each pay period.

Susan elects a health plan that costs $400. Because Susan has flex creditsavailable, the Benefits Administration application

� reduces Susan�s available flex credits to $600 ($1,000 - 400),

� Reduces Susan�s standard time record to $5.77 ($600 * 0.50/52)

� Creates a flex company deduction of $7.69 ($400/52) for the cost of thebenefit


If Susan elects no more benefits, her taxable wages are $1,005.77 ($1,000 +5.77), as shown on the payment below.

Wages DeductionsRegular $1,000.00 Health-flex

company$7.69

flex credits 5.77

Totals $1,005.77

Taxable wages $1,005.77

Susan elects a disability benefit that costs $750.00. The BenefitsAdministration application

� Reduces Susan�s available flex credits to zero ($600 - 750)

� Deletes Susan�s standard time record

� Creates a flex company deduction of $11.54 ($600/52) for the portion ofthe benefit�s cost paid for with flex credits

� Reduces her available pretax dollars to $4,850 ($5,000 - 150)

� Creates a pretax deduction of $2.89 ($150/52) for the portion of the bene-fit�s cost paid for with pretax dollars

Susan�s taxable wages are $997.11 ($1,000 - 2.89), as shown on thepayment below.

Wages DeductionsRegular pay $1,000.00 Health-flex

company$7.69

Disability-flexcompany

11.54

Disability-pretax 2.89

Totals $1,000.00 $2.89

Taxable wages $997.11

Flex Plan 2 Example� Gives employees flex credits based on the benefits they elect. The flex

credits can be used to purchase other benefits.

� Creates one standard time record for each employee using the flex plan�sflex pay code.

� Increases available flex credits when employees elect benefits with nega-tive premiums.

� Reduces available flex credits when employees elect benefits with positivepremiums.

� Shows only the net gain from benefit elections on employee paymentswhen an employee receives more flex credits than he or she has spent.


415

� Uses flex company deductions to show spent flex credits on payments.

To create the second flex plan, ABC Foods assigns a flex pay code only to theflex plan. A flex company deduction is assigned to each benefit plan.

Employees in ABC Food�s second flex plan can keep all of their unspentflex credits.

Creating flex credit Records for EmployeesABC Foods runs BN145 (flex credits Calculation) to create flex credit recordsbased on the flex credit and pretax parameters on BN08.1 (flex credits). Theflex credit record indicates that employees have $5,000 pretax dollars tospend on benefits. Because employees receive no flex credits before theyelect benefits, BN145 creates no flex credits and no standard time records.

Enrolling Employees in BenefitsBenefits in this kind of flex plan have negative and positive premiums.

When you enroll an employee in the first benefit with a negative premium, theBenefits Administration application

� Increases the employee�s available flex credits

� Creates a standard time record for the employee using the flex pay codefrom the flex plan

When you enroll an employee in additional benefits with negative premiums,the Benefits Administration application

� Increases the employee�s available flex credits

� Increases the employee�s existing standard time record

When you enroll an employee in a benefit with a positive premium, theBenefits Administration application spends flex credits first, then pretaxdollars. When all flex and pretax dollars are spent, the Benefits Administrationapplication spends after-tax dollars.

When an employee spends flex credits to pay for a benefit, the BenefitsAdministration application


� Reduces the employee�s standard time record (when the employee usesall of his or her flex credits, the standard time record is deleted)

� Creates a flex company deduction for the cost of the benefit

When all flex credits have been spent and the employee uses pretax dollarsto pay for a benefit, the Benefits Administration application

� Reduces the employee�s available pretax dollars


When the employee has spent all of his or her pretax dollars and theapplication uses after-tax dollars to pay for a benefit, the application



ExampleMark�s benefits are:

Flex vacation (sold 10 hours) $115-

Dental $130-

Health $50

When Mark elects the flex vacation benefit that gives him $115 flex credits,the Benefits Administration application

� Increases Mark�s available flex credits to $115

� Creates a standard time record for Mark for $2.21 ($115/52)

When Mark elects the dental benefit that gives him $130 flex credits, theBenefits Administration application

� Increases Mark�s available flex credits to $245 ($115 + 130)

� Increases his standard time record to $4.71 ($245/52)

If Mark elects no more benefits, his taxable wages are $1,004.71 ($1,000.00+ 4.71), as shown on the payment below.

Wages Deductions

Regular pay $1,000.00 None

flex credits 4.71

Totals $1,004.71


Mark elects a health benefit that costs him $50. Because Mark has flex creditsavailable, the Benefits Administration application

� Reduces Mark�s available flex credits to $195 ($245 - 50)

� Reduces Mark�s standard time record to $3.75 ($195/52)

� Creates a flex company deduction of $0.96 ($50.00/52) for the cost of thebenefit

If Mark elects no more benefits, his taxable wages are $1,003.75, as shownon the payment below.

Wages DeductionsRegular pay $1,000.00 Health-flex

company$0.96

flex credits 3.75

Totals $1,003.75



417

Flex Plan 3 Example� Gives employees flex credits based on the benefits they elect. The flex

credits are not used to purchase other benefits.

� Creates multiple standard time records for each employee using each ben-efit plan�s flex pay code.

� Does not increase available flex credits when employees elect benefits withnegative premiums.

� Does not reduce available flex credits when employees elect benefits withpositive premiums. Pretax deductions are created for the cost of benefits.

� Shows the total flex credits received on employee payments. Benefit elec-tions are shown as pretax deductions.

� Does not use flex company deductions.

To create the third flex plan, ABC Foods assigned a flex pay code to the flexplan and to each benefit plan under the flex plan.

Each employee in ABC Food�s third flex plan can keep all of his or herunspent flex credits.

Creating flex credit Records for EmployeesABC Foods runs BN145 (flex credits Calculation) to create flex credit recordsbased on the flex credit and pretax parameters on BN08.1 (flex credits). Theflex credit record indicates that employees have $5,000 pretax dollars tospend on benefits. Because employees receive no flex credits before theyelect benefits, BN145 creates no flex credits and no standard time records.

Enrolling Employees in BenefitsBenefits in this kind of flex plan have negative and positive premiums.

Each time you enroll an employee in a benefit with a negative premium, theBenefits Administration application

� Does not update the employee�s available flex credits because the flexcredits from benefits with negative premiums are not available to purchaseother benefits

� Creates a standard time record for each benefit using the flex pay code oneach benefit plan

When you enroll an employee in a benefit with a positive premium, theBenefits Administration application spends pretax dollars first, then after-taxdollars.

When the employee uses pretax dollars to pay for a benefit, the BenefitsAdministration application

� Reduces the employee�s available pretax dollars


When the employee has spent all of his or her pretax dollars and theapplication uses after-tax dollars to pay for a benefit, the BenefitsAdministration application



ExampleMark�s benefits are:

Flex vacation (sold 10 hours) $115-

Dental $130-

Health $50

When Mark elects the flex vacation benefit that gives him $115 flex credits,the Benefits Administration application creates a standard time record forMark for $2.21 ($115/52).

When Mark elects the dental benefit that gives him $130 flex credits, theBenefits Administration application creates another standard time recordfor $2.50 ($130/52).

If Mark elects no more benefits, his taxable wages are $1,004.71 ($1,000.00+ 4.71), as shown on the payment below.

Wages DeductionsRegular pay $1,000.00 None

Flex vacation hours 2.21

Dental plan 2.50

Totals $1,004.71


Mark elects a health benefit that costs him $50. When the employee usespretax dollars to pay for a benefit, the Benefits Administration application

� Reduces Mark�s available pretax dollars to $4,950 ($5,000 - 50)

� Creates a pretax deduction of $0.96 ($50/52) for the cost of the healthbenefit

If Mark elects no more benefits, his taxable wages are $1,003.75 ($1,004.71 -0.96), as shown on the payment below.

Wages DeductionsRegular pay $1,000.00 Health-pretax $0.96

Flex vacationhours

2.21

Dental plan 2.50

Totals $1,004.71 $0.96



419

Defined Contribution Flex BenefitsDefined contribution benefits that spend flex credits are unique because theamount of flex credits the employee spends on the benefit has to be includedin the employee�s social and Medicare taxable wages. To accommodate this,the Benefits Administration application creates a standard time record offsetwith a 401(k) deduction. The Payroll application calculates the taxes.

Each defined contribution plan under a flex plan has a unique flex pay code.Like all other benefits, if an employee spends flex credits on a definedcontribution plan, the Benefits Administration application does the following toshow the flex credits spent.


� Reduces the employee�s flex standard time record

Unlike other benefits, the Benefits Administration application does thefollowing to include flex credits in the employee�s social and Medicaretaxable wages.

� Creates a standard time record equal to the number of flex credits spenton the defined contribution benefit

� Creates a 401(k) deduction equal to the entire contribution. If both flex andpretax dollars are contributed to the defined contribution plan, the BenefitsAdministration application creates a 401(k) deduction that includes boththe flex credit and pretax dollar amounts.

For example, Walter has $1,000 flex credits and $5,000 pretax dollars tospend on benefits. For Walter�s $1,000 flex credits, the Benefits Administrationapplication creates a standard time record for $19.23 ($1,000/52).

Walter contributes $1,500 to a 401(k) plan. To do so, he uses all of hisflex credits and $500 pretax dollars.

The Benefits Administration application

� Reduces Walter�s available flex credits to zero

� DeletesWalter�s standard time record because he used all of his flex credits

� Creates a standard time record using the defined contribution�s flex paycode for the flex credits Walter spent on the 401(k) plan [the amount of thestandard time record is $19.23 ($1,000/52)]

� Creates a 401(k) deduction equal to the flex and pretax dollars Walter spenton the 401(k) plan. The amount of the deduction is $28.85 ($1,500/52)

Walter�s $1,000 flex credits, which he spent on the defined contributionbenefit, are included in gross wages. The 401(k) deduction reduces alltaxable wages except social and Medicare.


Using Flex Benefit PeriodsA flex benefit period is a period of time for which a particular combinationof an employee�s flex benefits are in effect during a flex plan year. TheBenefits Administration application uses flex benefit periods to determinehow many flex and pretax dollars an employee has available and has spenton any date in a flex year.

Initially, the Benefits Administration application creates one flex benefitperiod for the entire flex plan year. Each time you add or stop benefits ina flex plan year, the Benefits Administration application updates or createsanother flex benefit period.

For example, Dorothy receives $1,000 flex credits for the flex plan year.The Benefits Administration application creates one flex benefit period forthe entire flex plan year and one standard time record for the amount of$19.23 ($1,000/52).

Dorothy enrolls in the following benefits from January 1 to December 31.

Benefit Cost

Dental $100

Employee Life 75

Health 500

Total $675

Dorothy spends some of her flex credits, so the Benefits Administrationapplication reduces her standard time record to $6.25 ($325/52).

On April 1, Dorothy changes her benefit elections. ABC Foods stops herexisting benefits on March 31. The Benefits Administration application stopsthe first flex benefit period and the associated standard time record on March31. The Benefits Administration application creates a second flex benefitperiod and standard time record for April 1 through December 31. Theamount of the standard time record is $19.23 ($1,000/52) because Dorothyhas not spent any flex credits during the second flex benefit period.

ABC Foods adds the following benefits for Dorothy beginning April 1.

Benefit CostHealth $1,000

Dental 100

Employee Life/AD&D 75

Disability 100

Total $1,275

Dorothy spends all her flex credits for the second flex benefit period, sothe Benefits Administration application deletes the standard time recordassociated with the second flex benefit period.


421

On September 30, Dorothy stops her benefits for the rest of the flex plan year.The Benefits Administration application stops the second flex benefit period.The Benefits Administration application creates a third flex benefit period andstandard time record for October 1 through December 31. The amount of thestandard time record is $19.23 ($1,000/52) because Dorothy has not spentany flex credits during the third flex benefit period.

By looking at Dorothy�s flex benefit periods, you can see that she had threedifferent combinations of benefit elections in this flex plan year. During thefirst period, she received part of her flex credits as taxable income. Duringthe second period, she spent all her flex credits. During the third period, shereceived all her flex credits as taxable income.


Processing Automatic Benefit ChangesThe following explains how Employee Change Benefit Update (BN100)processes benefit changes based on employee changes made by personnelactions.

Creating Benefit Change Audit RecordsEmployee Change Benefit Update (BN100) determines which benefits areupdated using benefit change audit records. A benefit change audit recordis created on Benefit Change Audit (BN35.1) when a personnel action thatmight affect employee benefits is updated in Individual Action (PA52.1)or Action Update (PA100).

A benefit change audit record is created by a personnel action if all of thefollowing are true.

� The personnel action is made on an employee who has at least one benefit.

� When the personnel action was made on the employee, the Update Bene-fits field is Yes in Individual Action (PA52.1), Mass Pay Action (PA52.2), orMass Action (PA52.3).

� The personnel action performs one or more of the following changes:� Adds or deletes the employee from an employee group that was

defined with Yes in the Benefits field on Employee Group Definition(HR55.1), Employee Groups By Employee (HR55.2), or EmployeeGroups By Criteria (HR55.3).

For example, a personnel action changes the employee�s status frompart-time to full-time. The status change removes the employee fromthe PARTTIME employee group and adds the employee into theFULLTIME employee group.

� Changes the employee�s benefit postal code in Employee (HR11.1).NOTE If an employee�shome postal code andbenefit postal code arethe same, changing anemployee�s home postalcode also changes theemployee�s benefitpostal code.

� Changes the employee�s salary. Changes to all of the following dataitems from Employee (HR11.1) are considered a change to the em-ployee�s salary: job code, FTE (Full-Time Equivalent), rate of pay, step,grade, schedule, salary class, or benefit salaries 1 through 5.

� Changes the employee�s pay frequency� Changes the employee�s birthdate� Changes the employee�s age*� Changes the employee�s years of service. * Changes to all of the fol-

lowing data items from HR11.1 (Employee) are considered a changeto the employee�s years of service: hire date, adjusted hire date, se-niority date, and benefit dates 1 through 5.

� Changes the employee�s smoker status. *

* Indicates these changes are listed on Employee Change BenefitUpdate (BN100) as affecting an employee�s benefits but do not triggerBN100 to update an employee�s benefits.


423

If a change is on hold on Benefit Change Audit (BN35.1), Employee ChangeBenefit Update (BN100) does not process the change. A change is on holdif you change the Hold field to Yes on BN35.1.

After BN100 processes a change, the change is deleted from BN35.1.


Index

AActual contribution percentage, 9, 334Actual deferral percentage, 9, 334Add rules

Defining, 6, 202When do I use, 6, 197

Annual limitsDefined, 3, 46Defining, 4, 49

Automation rulesDefined, 6, 197How do I use employee groups, 6, 200Updating benefits automatically, 7, 253What happens when I add benefits, 7, 250What happens when I change benefits, 7, 249What happens when I stop benefits, 7, 248

BBeneficiaries

Assigning for a savings bond, 7, 241Assigning to plan, 7, 241

Benefit categories, 4, 94Benefit change audit records, 7, 245Benefit dates, 4, 92Benefit plan

Defining primary, 5, 95How do I enroll employees, 6, 223How does Lawson track changes, 8, 288Terminating or replacing, 8, 300Why change, 8, 288

Benefit process orderDefined, 3, 48Defining, 4, 52

Benefit salaries, 5, 123Benefits

Big Picture, 3, 24Process flow, 3, 23Setup overview, 3, 29

CCalculations

Annual and hourly pay rates, 10, 396COBRA excess premium amounts, 10, 410Company match, 10, 398

Cost of excess life insurance, 10, 404Change records

Holding or deleting, 7, 251Change rules


Changing benefitsManually, 7, 260

COBRAAdding a second occurrence, 7, 275Calculating excess premium amounts, 10, 410Canceling coverage, 7, 278Changing participant benefits, 7, 274Defining parameters, 3, 39Enrolling a participant, 7, 272Notification letters, 7, 277Notifying or terminating rights, 7, 277Occurrence types

Defined, 3, 35Defining, 3, 41

ParticipantDefined, 7, 269Defining, 7, 270

Tracking dates, 7, 275Company


Company matchCalculating contributions, 5, 155

CompensationAdjusting balances, 9, 321

Contribution rate tables, 5, 158Contribution types

Defined, 4, 85Differences between, 5, 150Working with coverage types, 4, 87

ContributionsCompany match, 5, 155Defining flat, 5, 173Defining limits, 6, 180How calculated, 5, 153How do I define, 5, 149Updating, 8, 292

Coverage amountsDefining, 5, 129When to use, 5, 124

Coverage informationUpdating, 8, 291

Coverage limits

Benefits Administration User Guide Index 425

Defining, 5, 140Coverage options

Defining, 5, 125Deleting, 8, 300, 302When to use, 5, 124

Coverage rate tableDefining, 6, 177

Coverage reduction tableDefined, 5, 124Defining, 5, 138

Coverage salary parametersDefining, 5, 135

Coverage typesDefined, 4, 84Working with contribution types, 4, 87

DDeductions

How used, 4, 88Default plan

Automatic enrollment, 6, 226Defined, 4, 89

Defined benefitAdjusting balances, 9, 320Define compensation, vesting, reporting, 5,

104Determining percentage participation, 9, 335

Defined contributionAdjusting balances, 9, 320Define compensation, vesting, reporting, 5,

104Determining percentage participation, 9, 335Flex benefits, 11, 420Forcasting balances, 9, 352Top heavy, 9, 332

DependentChanging benefits, 7, 266Enrolling, 7, 240

EElective deferral limit, 9, 335Eligibility, 4, 90Eligibility date, 6, 223Employee groups, 4, 90

Nested, 6, 200Enrolling dependents, 7, 240Enrolling employees

Automatically into default plans, 6, 226Manually into multiple plans, 6, 230

Enrollment

Forms, 6, 225Updating for frequency table changes, 8, 298Updating for plan changes, 8, 296

Entry points, 5, 115Entry rules

Defined, 5, 115Defining, 5, 117How to define, 5, 115

EstimatingTake home pay, 9, 350

Excess life insurance rates, 3, 42

FFlex core plans, 4, 92Flex credit rate tables, 4, 69Flex credit record, 6, 213Flex credit records

Defined, 4, 57When to define, 4, 58

Flex creditsAutomatically creating records, 6, 215Changing, 7, 264Defined, 4, 57Defined contribution benefits, 11, 420Defining, 4, 64Defining based on age, 4, 72Defining based on dependents, 4, 75Defining based on lifestyle, 4, 76Defining based on years of service, 4, 74Issued, 4, 58Manually creating records, 6, 217Structured, 4, 58Tracking, 10, 412Unspent, 4, 59

Flex periods, 6, 11, 213, 421Flex plan

Considerations when manually changing, 7,247

How do I make mid-year changes, 7, 247When is a standard time record created, 6, 214

Flex plan contributions, 5, 156Flex plans

Defined, 4, 56Defining full, 4, 62Defining spending account only, 4, 61

Flex salary parameters, 4, 67Flexible spending accounts, 7, 262Frequency table

Defined, 3, 47Frequency tables

Attaching a different, 8, 294Defining, 4, 52

426 Index Benefits Administration User Guide

Updating, 8, 293

GGeneral ledger

Overriding accounts, 5, 108Updating overrides, 8, 294

HHighly compensated employees, 9, 332

IInsurance carriers, 4, 50Integration, 3, 25

SEA, 26Investment options, 5, 107Invoices

Creating manual, 9, 338Creating monthly, 9, 340Printing, 9, 341Updating to General Ledger, 9, 345

KKey employees, 9, 330

MMatch limit schedules, 6, 186Match percent schedules, 6, 190

NNested employee groups, 6, 200

OOptions amount

Defining, 5, 165Defining a range, 5, 170

PPayments

Entering and automatically applying, 9, 342Entering and manually applying, 9, 343Updating to General Ledger, 9, 345

Plan TypeCharecteristics, 4, 82Defined, 4, 81

Postal code tables, 4, 53Process benefits

How does Lawson, 7, 246Purging

Benefit enrollments, 10, 353Invoices and payments, 10, 355

RRate tables, 5, 155Re-entry rules, 5, 115Report samples, 10, 357Reportable Group Term Life Insurance, 3, 36Reportable income, 9, 325Retiree

Canceling coverage, 8, 286Defined, 7, 282Enrolling, 8, 283

SSalary override, 6, 224Salary rate table, 6, 177Savings bond

Adding beneficiaries, 8, 314Assigning beneficiaries, 7, 241Defining purchase sequence, 9, 315Updating purchases, 9, 316

SimulatingBenefit elections, 9, 348

Spending account, 8, 308Standard record, 6, 214Start date, 6, 224Statuses

Viewing records requiring updates, 8, 295Which are tracked, 8, 290

Stock purchasesUpdating, 8, 312

Stop dates, 7, 246Stopping employee benefits, 7, 259

Benefits Administration User Guide Index 427

TTermination rules


UUpdating benefits

Automatically based on age, salary, years ofservice, 7, 256

Automatically based on automation rules, 7,253

Processing, 11, 423

VVacation

Update balances, 8, 304Vesting

Adjusting hours, 9, 322Vesting schedule


WWaive plan, 4, 91

428 Index Benefits Administration User Guide

benefits user guide

Documents

dc db balance conversion

general ledger overrides

general ledger account

general ledger transactions

user exits functionality

global support manual

spending account balance

general ledger accounts