Updates coming soon contain two new additions to Datatech software.
The HRM Software update contains a small change to employee Health Benefit records. The Payroll Software also contains a new Utility. These new features may not apply to or be used by your company, but please review the following information to find out how they might affect your workflow.
What Are These New Features?
Let’s begin with the additional entry now appearing on the Health Benefit records in your HRM Software. The new ‘Monthly Max’ entry is shown in the following image. It will now appear for all HRM Software users, whether or not the specific scenarios described in this post apply to your employee payroll deductions. (Please note you must be running version 126.96.36.1992 or newer in the HRM Software to see this feature.)
The HRM Software automatically calculates the amount shown in this entry. The amount cannot be removed or edited by the user, and it only appears in this entry when the employees’ total monthly payroll deductions exceed the total monthly cost of his coverage. The software will also automatically enter this same amount on the Deductions tab in the “Total to Deduct” entry. See the following image:
What Is Its Purpose?
The purpose of this feature is to ensure the total amount of payroll deductions for any given employee does not exceed the monthly cost of the coverage for that employee. Notice our example shows the Monthly Max cost of coverage is $100.00, and the payroll deduction is $30.00 per week. The software calculates the Monthly Max amount by taking the Annual Self-Only Plan Cost ($1,200.00 in this example) and dividing it by 12 months to determine the monthly cost of coverage.
If the $30.00 amount were to be deducted every week of a given month, the employee would pay $120.00 in months with 4 pay periods. Then, he would pay $150.00 in months with 5 pay periods. Either way, the employee is paying more than the $100.00 monthly cost of his coverage.
Using the Monthly Max feature, the software ensures the employee deductions will not total more than the $100.00 cost of coverage. For Weeks 1-3 of each month, the software deducts $30.00. In Week 4, the software will only deduct $10.00, and when there is a Week 5, no deduction will be taken. In this way, the Total to Deduct entry on the Deductions tab moderates the deductions.
However, since this feature only tracks the total for each month, this total needs to be reset at the beginning of each Plan Month. To accomplish this monthly reset, we added a new Utility to your Payroll Software.
To find this utility go to Payroll > Utilities > Reset Misc. Deduction Total Deducted. (Please note you must be running version 188.8.131.520 or newer in the Payroll Software to see this feature.)
When should you run this utility? The answer depends on how your Payroll Software calculates the Week of Month.
How Week of Month is Determined
Have an Operator with ADMIN permissions go to Tools > Program Setup > Payroll tab. Note the third field from the bottom on the far left column of settings marked “Week of Month Calc. Basis.” This entry tells the software how to determine in which month, and to which week of the month, a Health Insurance deduction belongs.
For example, if “Ending Pay Period Date” appears in this setting, then the software uses the date of the last day of the pay period to assign the deduction to the correct month and week of the month. If your pay periods run Sunday – Saturday, an example pay period would be dated 06/23/2019 – 06/29/2019. If your pay periods run Monday – Sunday, then the pay period would be dated 06/24/2019 – 06/30/2019.
In either case, the pay periods end in the month of June. Therefore, the software first considers this as a June payroll deduction. This is important when your deduction rates will be changing for the following month. It also considers this week 5 for the month of June, because each of the previous four pay periods also ended in June. (May 26-June 1, June 2-8, 9-15, and 16-22 or May 27-June 2, June 3-9, 10-16, and 17-23, respectively.)
If you have a “Check Date: Friday” entry in the Week of Month Calc. Basis setting (or another day of the week on which you normally print payroll checks,) then the check date determines in which Month and to which Week of the Month the deduction belongs. In the previous pay period examples, a “Check Date: Friday” setting would consider the check dated July 5, 2019, as a deduction for the month of July. It would also consider the deduction as belonging to week 1 of the month of July.
Using the Reset Deduction Utility
Once you have determined how your software is calculating the week of the month, schedule into your monthly workflow the days of the year on which you will run the Reset Deduction utility.
In the previous example, if your Week of Month calculates using the Ending Pay Period Date, you would run the utility after having processed payroll checks for the June 23-29 (or June 24-30) pay period. You must be sure to run the utility prior to processing payroll for the June 30-July 6 (or July 1-7) pay period.
If your Week of Month calculates on “Check Date: Friday” (or another day of the week) then you would run the utility after you process the payroll on June 28. In this case, you must be sure to run the utility prior to processing the payroll on July 5, 2019.
To run the Utility, go to Payroll > Utilities > Reset Misc. Deduction Total Deducted. You will then see the window shown in the following image. Use the menu button to select the appropriate deduction number to reset. This deduction number should correspond to your Health Insurance deduction. When ready, click Reset.
First, the utility will create a report of all employees who have had this deduction taken (since the previous reset). You can review this report to audit your deductions and ensure all employees are being deducted correctly.
The utility will also immediately ask you if it is “Ok to reset miscellaneous deduction totals?” After reviewing the report, click Yes to reset the Total to Deduct and restart the deduction on the next check. Then, continue to process your payroll as usual until the next scheduled reset.
For questions about these new features, or if you are unsure if these new features apply to your situation, please direct your specific questions to Datatech Support using the following contact information:
Phone: (800)833-8824 Email: firstname.lastname@example.org