What are Benefit Salaries?

Benefit salary is the salary amount the Benefits Administration application uses to calculate the benefit and the deductions. The benefit plans can use the following salaries:

  • The employee's salary from his or her record in the Human Resources application

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

  • A combination of the employee's salary and one of the five salaries from the employee's record

  • The salary from the employee flex credit form

  • A user exit to define a custom formula calculation for the benefit salary, if none of the above options is sufficient

Example

River Bend Hospital life insurance coverage is based on commission employees earnings from the previous year of employment. The company is using one of the benefit salary fields to hold the total wages earned from a prior year.

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

Example 2

You have a disability plan in which coverage is calculated based on the previous calendar year's actual earnings. This must to include overtime pay, bonuses, and any other supplemental wages. At the start of each year you populate 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 of Benefit Salary 2 as the basis for the coverage calculation.