Benefits in SAP HR

Sap hr plan categories-

There are six international plan categories defined in the system: Health, Insurance, Savings, Stock Purchase, Credit, and Miscellaneous. You can use the Miscellaneous plan category for benefit plans that do not fit neatly into one of the other plan categories, such as fitness programs or company car privileges.

Retirement Plans are a special form of Savings Plans and are managed in that category.

The Flexible Spending Accounts category of benefits plans is specific to North America

The category defines the attributes of a plan.

sap hr benifit area

A benefit area must be administered in one currency.

If groups of employees have very different benefit plan pools, you can set up a benefit area for each benefit plan pool.

Benefit areas allow separate administration of independent benefit plan pools.

You can also create separate IMG projects for the set-up of each benefit area.

sap hr provider information

A benefit provider is the vendor or carrier of a benefit plan.

The list of benefit providers is valid for all benefit areas that you subsequently define.

sap hr benefit categories

There are five international benefit categories. These are the Health. Insurance, Savings, Credit, and Miscellaneous categories.

There is one USA specific benefit category. It is the Spending Accounts category.

The category defines the attributes of a plan. This determines how the plans are set up in the IMG and how employees are enrolled in the plans.

sap hr plan types

Plan types are the subdivisions of the benefit plan categories.

The categories are defined by SAP. Plan types and plans can be customized.

The system allows employees to be enrolled in only one plan per plan type.

sap hr category

The category determines which info type the system creates.

The plan type defines the subtype of this record.

The plan is the employee's plan enrollment.

sap hr plan status

The plan status defines whether the plans are active and whether employees are currently enrolled in the plan.

This information is used later when you define benefit plans.

The three possible statuses are closed, open, and locked.

sap hr beneficiciaries

During enrollment, the system allows you to select certain of the employee's family or related persons as dependents and beneficiaries. In order to be selected, these types of individuals must be selected here. The possible selections here are the subtypes of Family/related person (Infotype 0021) records. For each subtype, you must define those who are relevant as dependents and those who are relevant as beneficiaries.

This screen determines which subtypes from Family/related persons (Infotype 0021) are valid as:

dependents for health plan

beneficiaries for insurance, savings, and miscellaneous plans.

Health Plans:

sap hr health plan setup

Health plans can be set up in different ways. Above you can see possible ways to set up a health plan.

The category ‘Health' is a pre-defined by SAP. The plan type is defined in the Basic Settings in the benefits IMG.

The Plan, Options, Dependent coverage, and Cost formula building blocks are all set up in the Health plans section of the IMG.

Options represent the different levels of health care within a health plan.

An option may consist of varying levels of dependent coverage.

Each combination of option and dependent coverage has a cost formula

Tip:

At the dependent coverage level, you can set up a waive option with zero costs to positively record that an employee has not elected the benefit plan. For example, if an employee is covered under a spousal plan.

Define Health Plan General Data:

This will be the first step in creating a Health Plan. Just mention the general data like the Plan Category, Provider, etc.

Define Health Plan Options n Dependent Coverages:

Options are defined for each health plan. Options represent the coverage choices an employee can make within a health plan.

Dependent coverages are defined for all health plans

Options and dependent coverages are elements used later when you assign the elements of a health plan.

Checkout Our  SAP Hr Tutorials

Cost Formula:

sap hr cost formula

Cost may be graduated according to one or a combination of the following:

  • Salary
  • Age
  • Length of service (LOS)

The criteria ID allows you to group employees according to these criteria for cost calculation.

The cost formula defines what determines the cost of a health plan. It may use a criteria ID, as described above, and in addition:

  • gender
  • smoker/non-smoker
  • cost group

The cost formula calculation rule then defines the cost of the plan for an employee who may have any combination of the above criteria.

The cost group feature's technical name is CSTV1.

The cost group feature, like all other features, processes the data of each employee, one at a time, and allocates him or her to the correct cost group.

Cost Rule:

For every cost variant and every plan, you have to create a Cost Rule. Cost Rules are used to define the actual costs for a Health Plan. We can define the following Flat Costs:

Employee Cost

Provider Cost

Assign Health Plan Attributes:

sap hr health plan attribute

This is the final step in defining a health plan.

All the building blocks (options, cost formula, etc.) you have already defined, are brought together here.

INSURANCE PLANS:

sap hr insurance set-up

Insurance plans can be set up in different ways. Above you can see one possible way to set up an insurance plan.

The category ‘Insurance' is pre-defined by SAP. The plan type is defined in the Basic Settings in the benefits IMG.

The Plan, Options, Coverage formula, and Cost formula building blocks are all set up in the Insurance plans section of the IMG.

sap hr insurance set-up detail

Like the Health Plan, an Insurance Plan should also be created by defining the Plan.

In an Insurance Plan, we have to work on Coverage Formula and Coverage Rules as we have worked on Cost Formula and Cost Rule in Health Plan.

Coverage Formula:

sap coverage formula

Coverage may be graduated according to one or a combination of the following:

  • Salary
  • Age
  • Length of service (LOS)

The criteria ID allows you to group employees according to these criteria for coverage calculation.

The coverage formula defines what determines the coverage allocated to the employee. It may use a criteria ID, as described above, and in addition coverage group.

The coverage formula calculation rule then defines the coverage of the plan for an employee who may have any combination of the above criteria.

The coverage group feature's technical name is CRDV1.

The coverage group feature, like all other features, processes the data of each employee, one at a time and allocates him or her to the correct coverage group.

The coverage group allows you to include other coverage criteria, which are not included in the coverage formula.

A Coverage Formula Rule must be created for every Coverage Formula.

sap hr plan coverage

This is where the actual coverage is defined.

Coverage can be a factor of salary or a flat amount.

The coverage limits within the plan are defined here.

Example:

BASIS                             =          130,000 + (2 x 35,000) = 200,000

ADDITIONAL                 =          8 x 1000 = 8,000

TOTAL                           =          208,000

MINIMUM LIMIT          =          SMALLER OF (150,000, 35,000) = 35,000

MAXIMUM LIMIT         =          500,000

COVERAGE 208,000 is within limits.

sap hr cost formula

Cost may be graduated according to one or a combination of the following:

  • Salary
  • Age
  • Length of service (LOS)

The criteria ID allows you to group employees according to these criteria for cost calculation.

The cost formula defines what determines the cost of a health plan. It may use a criteria ID, as described above, and in addition:

  • gender
  • smoker/non-smoker
  • cost group

The cost formula calculation rule then defines the cost of the plan for an employee who may have any combination of the above criteria.

The cost group feature's technical name is CSTV1.

The cost group feature, like all other features, processes the data of each employee, one at a time, and allocates him or her to the correct cost group.

Cost Rule:

For every cost variant and every plan, you have to create a Cost Rule.

Example:

The dark box represents a cost formula calculation rule applicable to employees:

  • of an age greater than 25 years
  • in cost group ‘salaried'
  • with a length of service of 0-3 years

sap hr calculation rule

Costs can be flat cost or based upon the coverage of the insurance plan.

The two examples below show how the cost is graduated, based on how much coverage the employee has chosen.

Example 1:

  • An employee has 150,000 COVERAGE
  • COST is 0.12 per 1000
  • COST for this employee in this plan is  (150,000/1000) x 0.12 = 18.00

Example 2:

  • An employee has 175,000 COVERAGE
  • COST is 0.6 per 5,000
  • COST for this employee in this plan is (175,000/5,000) x 0.6 =  21.00

sap hr plan attibutes

This is the final step in defining an insurance plan.

All the building blocks (coverage formula, cost formula) you have already defined, are brought together here and the options for the insurance plan are defined.

You allocate a cost formula and coverage formula to every option of the insurance plan.

Remember that the cost formula defines the employee data that affect the cost, and the coverage formula defines the employee date that affects coverage. These formulas point to the relevant formula calculation rule, for each employee.

Note: In the same way you can move ahead with the configuration of Benefit Plans relating to different Plan categories like Savings Plan. Miscellaneous Plan etc.

BENEFITS ADMINISTRATION:

First Program Grouping:

sap hr group feature

The benefit group feature's technical name is BENGR.

The benefit group allows you to sort employees into different groups, depending on which plans you offer to different groups of employees.

The benefit group is one dimension of the defined benefit program

Second Program Grouping:

sap hr group feature 2

The employee status feature's technical name is BSTAT.

The employee status allows you to sort employees into different groups, depending on which plans you offer to different groups of employees.

The employee status is one dimension of the defined benefit program

Eligibility Rules:

sap hr group definition

The benefits program gives the plans an employee is eligible for. This is macro eligibility.

The eligibility rules are then applied to plans within a program to provide the micro eligibility.

The eligibility rule points to eligibility rule criteria.

Each employee can have a different eligibility rule criteria depending on his or her eligibility group.

The eligibility group feature enables you to group employees according to their personal data.

The eligibility group feature's technical name is ELIGR.

sap hr rule criteria

You do not have to define eligibility rule criteria for every possible combination of eligibility rules and eligibility groups.If an eligibility rule criteria are not defined for the combination of eligibility rule and eligibility group, then the employee is not eligible for the plan.

The eligibility rule criteria consist of:

  • waiting period
  • minimum working hours
  • age restrictions

The hire date override allows you to specify a data type that may be used instead of the employee's hire date as the beginning date for the waiting period. The system reads the hire date override from Date specifications (Infotype 0041) records.

sap hr eligibility

Within a program, you can use the eligibility rule to further restrict who may enroll in a particular plan.

The eligibility rule defines specific eligibility groups and respective eligibility rule criteria.

Termination Rule:

sap hr mirror image

Termination is the mirror image of eligibility.

Just as eligibility determines when an employee starts participating in a benefit plan, termination defines when he or she stops.

sap hr termination

Termination and eligibility are set up symmetrically in the benefits system. Where an eligibility rule specifies the waiting period before an employee may start participating in a benefit plan, termination specifies when the employee stops participating.

The termination rule points to termination rule criteria.

Each employee can have a different termination rule criteria depending on his or her termination type.

The termination type feature enables you to group employees according to their personal data.

The termination type feature's technical name is TRMTY.

sap hr rule criteria

For every termination type and termination rule combination, you must define termination rule criteria.

The termination rule criteria consist of:

  • coverage continuation period
  • termination day

The leaving date override allows you to specify a data type that may be used instead of the employee's leaving date as the beginning date for the coverage continuation period. The system reads the leaving date override from Date specifications (Infotype 0041) records.

sap hr termination rule criteria

Within a program, you can use the termination rule to define when the plan participant terminates enrollment.

The termination rule points to specific termination types and respective termination rule criteria.

Benefit Program:

A program is a restricted list of plans available to a specific group of employees.

The features benefit group and employee status place an employee into a particular program.

For every combination of benefit group and employee status, you must define

sap hr program

In the program, the plans available to a specific group of employees are listed.

An eligibility rule and a termination rule are allocated to each individual plan.

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