What is Payroll Area

Exactly what is the role of payroll area in payroll?

Payroll area

The payroll area fulfills two functions that are necessary for payroll:

It groups together personnel numbers that are to be processed on the same date.

It determines the exact payroll period.

For each newly created payroll area, you must create a corresponding payroll control record.

The payroll area to which employees belong depends on their organizational assignment. Employees who belong to different company codes can, for example, be included in the same payroll area.

You need different payroll areas for different employee groups in the following cases:

(1) The payroll periodicity is different. Hourly-paid workers, for example, have payroll run weekly, salaried employees have payroll run monthly.

(2) The payroll period is varied. For salaried employees, payroll is run on the 25th of the month, for company pensioners, on the 20th of the previous month.

(3) The payment date is varied. For weekly wage earners it is, for example, the fourth day of the following week, for salaried employees, the first of the following month.

(4) The retroactive accounting limit is varied. Payroll should not be able to be run as far back for one group of employees as for another.

(5) For some employees, payroll should not be run at all.
 

Configure

For creating Payroll area and Control record either of the two methods given below can be used.

Method 1

SPRO -> IMG -> Personnel Management -> Personnel Administration ->  Organizational Data -> Organizational Assignment -> Create Payroll Areas

SPRO -> IMG -> Personnel Management -> Personnel Administration ->  Organizational Data -> Organizational Assignment -> Check Default Payroll Area

SPRO -> IMG -> Personnel Management -> Personnel Administration ->  Organizational Data -> Organizational Assignment -> Create control record
 

Method 2

SPRO -> IMG -> Payroll -> Payroll: India -> Basic Settings -> Payroll Organization

Under this, configure the following steps:

Define Period Parameters

Define Date Modifiers

Check Payroll Accounting Area

Generate Payroll Periods

Generate Calendar for Cumulations

Kindly note that if period parameters are newly created, just Generate Payroll Periods before the third step Check Payroll Accounting Area.

For a Payroll area we can choose any Payscale group and level in IT0008

SAP HR Tips

Also See
SAP Organizational Management Q and A

SAP Human Resouce Books
SAP HR Books - Certification, Interview Questions and Configuration

SAP Human Resource Tips
SAP HR Tips and Human Resource Management

Main Index
SAP ERP Modules, Basis, ABAP and Other IMG Stuff

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