Review the purpose of pay agreements. A pay agreement defines the level of pay and employment conditions for workers in a specific industry or occupation.

Configure pay agreements in Rates and Rules, then assign each pay agreement to a specific level in the agreement hierarchy and a hierarchy value (for example, country, region, or another agreed dimension).

Make sure each pay agreement is only used where it is applicable. A pay agreement only applies to job orders that share the same hierarchy level and value. For example, a job order belonging to the country of Sweden can only be assigned to a pay agreement that also belongs to the country of Sweden in the agreement hierarchy.

When you create or maintain a job order that is subject to agreement rates (instead of standard rates) in Recruitment Manager, open the job order, then go to the Pay/Bill section to assign the applicable pay agreement.

Confirm that a pay agreement is assigned before you submit the job order to timesheet. Job orders that are subject to agreement rates must have a pay agreement selected before they can be submitted to timesheet, and the list of available pay agreements is filtered based on the agreement hierarchy values that apply to the job order.

Use primary interpretation to “prime” timesheet data. Primary interpretation takes raw timesheet entries and converts them into structured time blocks that can be used for pay calculation.

Configure primary interpretation in Rates and Rules by defining one or more primary interpretation headers on each pay agreement. Each header groups a set of rules that control how primary interpretation behaves for that pay agreement.

Set a validity period on each primary interpretation header to define when that specific set of rules applies. Only one primary interpretation header can be valid for a pay agreement at any one time.

If needed, enable the Compare to Job Schedule option on a pay agreement so that the job schedule defined on the job order is also interpreted and can be compared to the timesheet.

Use time rounding when timesheet entries do not align to whole pay units. For example, if a payee is paid hourly but enters a shift from 09:00 to 12:45, you need to decide how the last 45 minutes are handled (rounded up to an hour, paid as part of an hour, or not paid).

Configure a time rounding rule on the primary interpretation header to control whether the system rounds time up or down and by which factor (for example, to the nearest 15 minutes or to the nearest hour).

Remember that time rounding rules do not change the original timesheet entries. They only affect the time values used for pay calculation.

Apply at most one time rounding rule per primary interpretation header. It is optional to define a time rounding rule; if you do not configure one, no time rounding is applied by default.

If Compare to Job Schedule is enabled on the pay agreement, allow the time rounding rule to affect only the time that falls within the job schedule. Time outside the schedule is not changed by the time rounding rule.

If you need to round time worked outside the job schedule differently, configure an hour rounding rule on the primary interpretation header. An hour rounding rule works like a time rounding rule but applies only to time outside the job schedule (for example, rounding additional 45 minutes worked after a shift end up to a full hour).

Leave the hour rounding rule blank if you do not want to round time outside the schedule. If no hour rounding rule is defined, no rounding is applied to time outside the scheduled shift by default.

Use day type determination to identify the day and date on which each shift occurred on the timesheet. This allows the process to link each shift to the appropriate day types.

Configure holiday types and holiday rules in a holiday calendar so that primary interpretation can identify whether a shift falls on a weekday, Saturday, Sunday, or a specific holiday.

Allow the day type determination rules to treat shifts differently when they fall on special days. For example, a shift on a Sunday or a public holiday may attract a different pay rate or an additional pay loading compared to a standard weekday.

Identify shifts that cross midnight, such as a shift that starts at 23:00 and ends at 05:00 on the following day.

Configure a midnight boundary rule to determine how such shifts are treated for day type determination and pay calculation. A midnight boundary rule can specify that a shift which crosses midnight is treated as one of the following:

Use the selected midnight boundary option to ensure the correct day types and pay rules apply to each portion of the shift.

Recognise that a break is a period during which work stops and may be paid or unpaid. Primary interpretation needs to adjust timesheet data so paid and unpaid periods are clearly separated.

Define one or more unpaid break rules under each primary interpretation header for a pay agreement. These rules can specify that a payee is eligible for an unpaid break after a certain amount of time worked or at certain times of day.

During primary interpretation, compare the unpaid break rules in the pay agreement to any unpaid breaks entered on the timesheet.

When there is a difference between an unpaid break on the timesheet and an unpaid break defined in the pay agreement, use the variance value in the unpaid break rule to decide whether the breaks clash:

Use the resulting set of breaks to split the timesheet into blocks of paid and unpaid time so that only paid time is used for pay calculation.

After unpaid breaks have been applied, allow the primary interpretation process to split each paid and unpaid period on the timesheet into separate items.

If project codes are used, ensure that each attendance or absence entry associated with a project code is treated as a separate item for interpretation and that all time for that entry is allocated to that project code.

For example, consider this timesheet:

The total paid hours are allocated as:

If the timesheet contains time that is not allocated to any project code, allocate that unassigned time to the default project code defined on the job order.

Enable Compare to Job Schedule on a pay agreement if you need to see how much time a payee worked inside or outside the scheduled hours on the job order.

When this option is enabled, run both the job schedule (from the job order) and the timesheet through the primary interpretation process so they can be compared.

Use the interpreted schedule and timesheet to identify time worked outside the schedule, for example overtime or extra hours before or after a scheduled shift.

Configure rules in the secondary interpretation stage to determine how to treat time worked inside the schedule and time worked outside the schedule. For example, you may pay time outside the schedule as overtime.

If Compare to Job Schedule is enabled, configure an hour rounding rule on the primary interpretation header to round only the portion of time that falls outside the job schedule (for example, round extra 45 minutes worked after the scheduled shift end up to one full hour).

Remember that time outside the schedule can occur at either the start or the end of a scheduled shift, and the hour rounding rule will apply to both cases.

Use secondary interpretation to apply conditions, actions, and action limits to the interpreted time data. These rules decide which pay codes apply and how much time is assigned to each pay code.

Configure pay code rules in Rates and Rules to define:

After the pay code rules run, allow Rates and Rules to determine the applicable pay rates for each pay code for which an action existed in the rules.

Configure pay rate rules in the pay agreement to define the pay rates that apply to each pay code, day type, or other relevant dimension so that secondary interpretation can calculate the final pay amounts from the interpreted timesheet data.