Customizing SAP Remuneration Statement

Co-development with SAP

Agenda

About City of Vancouver

Basic Payroll Process and Challenges

Options for Change

New SAP Solution

Overall Business Process – from Time Entry to Employee

Lessons Learned

Business Benefits

Questions

About City of Vancouver

Approximately 9,000 employees

16 different bargaining units

Live with SAP since Jan 1, 1999 (Payroll, June 4, 1999)

Currently on version 4.6C

Implemented Financials, Materials Management and Human Resources

Adding Plant Maintenance and Asset Accounting (May 26, 2003)

About City of Vancouver (contd..)

Current HR footprint

Personnel AdministrationOrganizational ManagementBenefitsCATSTime ManagementNet PayrollEnvironmental Health & Safety

HR modules being implemented 2003-2004Qualifications CataloguePerformance DevelopmentTraining and Events ManagementManager’s Desk Top

Project Business Drivers

Visibility and Acceptance of SAP

Remuneration Statement is the only part of SAP many employees see

Departments with high incidence of exception time wanted details and dates

Pay advice was difficult to read and interpret

Pay advice reported Year-to-Date on a ‘when earned’ rather than a ‘when paid’ basis

Concerns about the security of printing and distribution

Project Business Drivers (cont..)

Operational Efficiency

Concerns about speed, cost and control of the outsourced printing process

Employees looked to payroll administrators for explanations of their pay advice

Basic Payroll Process

SAP retro payroll re-runs previous periods in current period

Payroll cluster Results Table includes wage types with payroll splits like :

WPBP : Work Place Basic Pay

TAX1 : Master Data for Tax Calculation (IT 0224)

BT : Payment Information (IT009)

V0 : Variable Assignment (e.g. benefits, overtime)

Payroll cluster gives no indication as to the dates attached to a specific wage type

SAP Time Evaluation• CATS for time entry

• Time evaluation runs nightly

• Time evaluation updates balances, wage types and quota transactions in the time cluster (ZL, ZES, SALDO)

• ZL table includes all wage types generated for each day

Integration between time and payroll• Payroll reads time wage types (ZL table) from start date of

the pay period up to the end date of the pay period

• Payroll reads ZL table as of payroll run date

• Payroll reads a snap shot of time data

Basic Payroll Process (contd..)

The Problem

Payroll Cluster

One payroll period

If infotypes 0000,0001,0007 and 0008 are constant during the pay period -One WPBP split with Start Date Jan 2 End Date Jan 16

- Wage types in result table 70 Hours regular Hours WT 2 Hours OT 150% Wage Type 3 Hours OT 200% Wage type 0.5 Hour Meal Break WT

Dates

Time Cluster

Jan 2

7 Hours regular hours Time Type 7 Hours regular hours Wage Type 2 Hours OT 150% Time Type 2 Hours OT 150% Wage Type 3 Hours OT 200% Time Type 3 Hours OT 200% Wage type 0.5 Hour Meal Break TT 0.5 Hour Meal Break WT Jan 3,4,5,6, 7 Hours regular hours Time Type 7 Hours regular hours Wage Type Jan 9,10,11,12,13 7 Hours regular hours Time Type 7 Hours regular hours Wage Type

Time Entry

Jan 2

7 Hours Reg Hours 5 Hours OT paid Jan 3,4,5,6 7 Hou rs Reg Hours Jan 9,10,11,12,13 7 Hou rs Reg Hours

The Work Around

Previous Procedure• Bi-Weekly Activity Report from time cluster• Time entry deadlines set to avoid changes to Time

Data after running payroll and before running the Activity report and remuneration statement.

• Pay Advice included the summary of OT activity in current period and adjustments to prior periods

Problems with work around• Procedure very hard to follow• Two reports instead of one;

didn’t always reconcile• Numerous employee inquiries • Employee dissatisfaction

Options

1. In-house solution – modify SAP code• Required specialized consulting skills • Maintenance headache with every upgrade • Potential performance issues• SAP changes could make solution difficult to maintain

2. Work with SAP to develop a joint solution• More expensive• Longer process• Need SAP buy-in and City fundingBUT Code change would automatically be part of

future SAP releases

SAP Solution - Approach

Highlighted our issue in user focus session

Gathered feedback from SAP HR clients in Canada

Provided details of desired solution to SAP’s development team

Completed Proof of Concept with SAP Canada

Convinced City Management of the value of a standard SAP solution

Tried to interest other clients in sharing costs

Developed Statement of Work with SAP payment on successful completion

SAP Solution (cont..)

Discussions with SAP focused on how to1. Load dates from ZL table V0 split in results table 2. Build a new rule to load the dates into V0 table3. Provide the ability to print V0 split on the pay advice

Time needed to develop SAP solution1 Year after raising the issue in user focus sessions3 Months after having the statement of work ready

Time needed for in-house configuration40 days of business analyst time; 6 months elapsed20 days of end user testing

SAP Solution - Details

1. Load dates from ZL table V0 split in results table

Table to resolve dates issueV_T51P1: Add wage types using D7 indicator for those that should print with dates.

Tables to resolve other issuesV_512W_D: Identify wage type groups and print conditions for pay advice (Evaluation Class 02)

V_T54C4: Define New Calendar Type (K) and Assign Calendar Types to Period Parameters

V_T54C6: Define “When Paid” cumulation

V_ T54C3: Add wage types for K cumulation

SAP Solution - Overview

UpdatePayroll Results

Add WTwith dates

Add WTwith no

dates

Process Payroll custom schema

Process Time

custom schema

Process Overtime

Payroll SchemaPayroll Results

ZT00Z000ZVOT

ZZV2

PRCL 51?

OT Bank & OT Source

WT’s

All other WT’s

Yes

No

Dates Required

?

2. Create a rule to load the dates results table

Z000 calls Schema ZT00• Schema ZT00 processes time data

ZT00 calls rule ZVOT with function ZLIT • Function ZLIT will import wage types from ZL table into

IT table

Rule ZVOT checks processing class 51• ZVOT updates payroll results with OT source and OT

bank wage types

• For all other wage types, rule ZZV2 is called

Rule ZZV2 checks D7 indicator in table V_T15P1 • Rule ZZV2 determines which Wage Types should be

processed with dates and adds them to the V0 cluster

SAP Solution – Details (contd..)

SAP Solution – Details (contd..)

3. Provide ability to print V0 split on the pay advice

Created new table in the remuneration statement

Table RT_X includes the date of each wage type

Field CDATE is available to print as part of the line layout

Implemented rules to split retroactive entries from current period entries

R1 rule will print current period entries only

R2 rule will print retroactive adjustments only

Identified Split 9 as date split

Ran program RPUCRT0P to rebuild CRT with K cumulation

Demo - Overtime

Banked OT

Paid OT

Demo - New Pay Advice (OT)

Header

Starting Balance

Ending Balance

Paid OT in current PP

Details

Demo – Retroactive Adjustment

a) Reduce banked hours by 2

b) Add 2 hours to paid OT

Demo – Acting Pay

Acting pay on banked OT

Demo – New Pay Advice (Retro) Retro detail

with dates on paid OT

Banked OT at Acting Rate

Reduced Banked OT

End to End Business Process

Print Output Files

RunPayroll

Download to UNIX

Run VIPP*Run Remuneration

Statement

Stuff and Fold*Variable Intelligent Postscript Printware

Secondary Processing

Moved printing of pay advice in house(Xerox’s Variable Intelligent Postscript Printware)

Improved lookmultiple font sizes and shadinginclude City logonew formatting for messages

Increased securitysealed window envelopesecurity clearance for employees

Reduced costsincreased # lines per pageduplex printingmultiple pages per envelope

Secondary Processing (contd..)

Moved printing of pay advice in house (contd.)

Increased AccuracyRe-printing function for individual employee statements

Data validation routine to verify processing accuracy

Reporting on numbers of multi-page statements

Improved DistributionOutput split by employee groups to better manage handling

Lessons Learned - SAP

Positive experience co-developing with SAP

Clear statement of work minimizes cost

Business involvement is critical• Initial design• Final look and results

Should have tried harder to share costs and ideas with other SAP users

Can have two Pay Advice forms• Long form with all dates (used for regular payroll)• Short form without dates (for major retroactive

settlements)

Test, test, test

Lessons Learned – Overall

Mechanical processes more difficult to manage than software aspects of the project

Positioning of the window in the envelope is critical to smooth processing

VIPP software allows any statement to be recreated – useful for ‘snarl ups’

Useful to run the entire payroll through the full end to end process before ‘go live’

Additional Business Benefits

Reduced query time for payroll administrators (~50%)

Increased employee satisfaction with payroll, and with SAP

Increased privacy and security in printing process

End to end process from time entry to employee’s desk requires co-operation across the organization

New dates feature could also be used when recording paid absences

Code change will be part of standard Enterprise release

Contacts

Eyad Khadra– eyad_khadra@city.vancouver.bc.ca– (604) 871-6510

Livia Lowe– livia_lowe@city.vancouver.bc.ca– (604) 871-6520

COMMENTSCOMMENTS

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Session Code: 2205