These instructions on the Employees’ Pension Act (TyEL) control data settings aim to give a general idea how the control data determined in Procountor affect the handling of insurance contributions on salary slips.
Below is an example where the employee is covered by TyEL insurance and therefore the salary slip should have normal pension processing.
Procountor will automatically take into consideration the effect the employees’ age and monthly earnings have on the pension.
These instructions are for situations where the employer has KEVA as their earnings-related pension insurance institution.
TyEL control data in Procountor
The graph below illustrates a common situation where an employee is covered by TyEL. The control data is meant to ensure the necessary payments will be deducted from the employee’s salary on each salary slip and that the employer costs are automatically accrued. By filling out the details of the TyEL agreement in the Salaries basic info, the earnings payment report will have all the necessary pension information ready.
Salaries Basic Info view
Salary info view can be found in Management > Salary info > Salaries Basic Info.
Salaries basic info: Employer's TyEL payment percentages
Fill out the payment percentage of your company in the Employer's Employees' Pension Act contribution field. The default values in these fields are mainly meant as a general guideline and may not conform with the actual contribution percentage of the company. The company’s own insurance company can confirm the correct contribution percentage.
Salary Basic info: TyEL agreement details
All the necessary information about the pension agreement number and the Employer’s TyEL insurance payment percentage are filled in the Salaries basic info view. Please note that in this example the company is covered by KEVA.
When the selected insurance company is KEVA, the suborganization ID needs to be filled out. This field becomes mandatory after selecting the pension provider.
Salary info view is found in Payroll > Employee Register. First, select an employee from the list and then click button Edit Salary info.
Salary info: KEVA as pension provider
TyEL control data configuration continues on the Salary info view. This is where the employee-specific information is filled out. When a company is covered by KEVA, certain control data needs to be filled into the employee salary info. In Employments, the KEVA option needs to be checked and the Registration grounds ID (Keva) filled out. The maximum number of characters in the Registration grounds field is 80. If the employee’s employment has been terminated, the Reason for termination has to be filled out.
Salary info: Choosing the TyEL insurance and the pension agreement
After choosing an employee, choose Employees’ Pension Act (TyEL) from the drop-down menu and select the TyEL agreement for the employee.
After the deployment of the Incomes Register, even temporary employers need to have a TyEL pension insurance company and an agreement number. Temporary employers are given a generic insurance policy number by pension insurance companies. If you need a generic insurance policy number, contact your own insurance company.
Salary info: Applied insurance exceptions:
If the TyEL contribution needs to be in the salary base and on the salary slip, the insurance exception types section in Salary info has to be left blank.
More information about the insurance exception types and their effects can be found here.
Salary base view is found in Payroll > Employee Register. First, select an employee from the list and then click button Edit Salary base.
A fitting salary base template can be created for each employee on the salary base page. When the base salary has been set, a base salary slip row is added in Salary base. Additional salary types can be searched and added in the salary type register. If certain salary types - like mobile phone benefit, regular bonuses or other salary shares - are used regularly on salary slips, it is practical to add these to the salary base.
Salary base: The TyEL control data is built into the salary type
The salary types in the new payroll system have built-in control data for insurances according to which Incomes Register income type the salary type matches with.
For example, in Procountor the Evening work compensation salary type is built in a way that automatically matches it with the Incomes Register income type 207 (Evening work compensation). Incomes Register has also already ruled that this income type is, by default, covered by social insurance (such as pension, unemployment, accident, and health insurance.) When adding Evening work compensation salary type on the salary base, any earnings falling under this salary type will be taken into consideration when calculating earnings-related pension contribution.
The chart below depicts a situation where an employee’s salary slip contains a salary type Notice period compensation. This particular salary type does not fall under the social insurances and this has been configured in the control data.
This way, several different salary types that each behave differently in terms of pension contributions can be added on the same salary slip.
The TyEL control data is built into the salary type
Salary base: Calculating the Employee’s TyEL contribution
The salary type already contains the information about the earnings-related pension insurance contribution that salary type is subject to. Salary types that are not subject to the pension insurance contribution and those that are can both be added on the same salary base. The income subject to the pension insurance contribution is calculated from those salary types that are subject to the TyEL insurance contributions.
The employee’s TyEL insurance contributions are shown on the salary base rows. If the insurance contribution is not automatically calculated and the row is not added on the salary base, the TyEL control data should be rechecked and corrected in salary base.
Salary base does not include the employer’s TyEL contribution. This is only shown on salary slips.
Salary slip view
Salary slips are formed according to the information on the salary base. The salary slip can be edited if necessary. More salary types can be added on the slip using the salary type search and also slip rows filled in according to the salary base can be edited.
Salary slip: The TyEL control data is built into the salary type
The information whether or not the salary type is subject to pension insurance contributions is built into the salary type. Both these types - the salary types that are subject to the insurance contributions and those that are not - can be used on the same salary slip. The salary subject to TyEL contributions is calculated according to the sum of the salary types that are subject to these contributions. This is used as a basis when calculating the Employees’ and Employers’ pension insurance payments.
Salary slip: Employees’ TyEL contribution
The slip rows automatically calculate the employees’ pension insurance contribution. This is calculated with the base percentage from the earnings subject to the contribution. If the salary slip sum is under the minimum sum, the contribution will not be deducted.
If the employee’s contribution sum needs to be changed, this can be done using the salary type The Employees Pensions Act contribution correction (TyEL). Since the automatically calculated rows cannot be altered, the sum is corrected using this salary type. The final sum of the contribution is calculated using the original value and the value of the correcting salary type.
Salary slip: Employers’ TyEL contribution
The Employer’s TyEL contribution is shown on salary slips. This sum is automatically calculated using the slip rows. The employer’s TyEL contribution forms an accrual for these pension expenses on the accounting page of the salary slip.
By default, all the salary slips on the salary list have the same Employers’ contribution percentages defined on the Salaries basic info page in Management. However, if these percentages need to be adjusted for a justified reason, it can be done on the New salary list view before creating the slips.
Salary slip: Changing the Employees’ pension insurance agreement
The selected Employee’s Pension Act agreement is shown at the bottom of the Salary slip view and it can be changed here, if necessary. The information of the selected Employee’s Pension Act agreement will transfer onto the Earnings payment report.
If your TyEL pension insurance company has permanently changed, remember to update the correct insurance company in the Salaries basic info.
In some situations, the payroll accountant might not receive the notice about the pension insurance company change in time. The Incomes Register must be notified which salaries are part of which pension insurance agreement to pass on the correct information to the pension insurance companies. In this case, the previous Earning payment reports need to be corrected and the data that will be fetched to the reports can be corrected on the Salary slip.