This tutorial is a continuation of Fusion Payroll and how it functions.
The topics covered in this tutorial are:

• Payroll Statutory Units
  
  
• Legal Employers
  
  
• Tax Reporting Units
  
  
• Creating a Legal Entity
  
  
• Selecting the Scope of the Legislative Data Groups
  
  
• Defining Legal Reporting Units
  
  
• Creating Business Units
  
  

Payroll Statutory Units

Payroll Statutory Units (PSUs) are legal entities responsible for paying workers, including the payment of payroll tax and social insurance. A payroll statutory unit can pay and report on payroll tax and social insurance on behalf of one or more legal entities. Of course, this depends on the structure of your enterprise.

Legal Employers

A legal employer is a legal entity that employs workers. Legal Employers are captured at the work relationship level. All employment terms and assignments within that relationship are automatically with that particular legal employer.

Tax Reporting Units

Tax Reporting Units are responsible for grouping workers for the purpose of tax and social insurance reporting. They are the Human Capital Management’s version of the legal reporting unit in Oracle Fusion Applications. When a legal entity is selected as a payroll statutory unit, the application transfers the legal reporting units associated with that legal entity to Oracle Fusion Human Capital Management (HCM) as tax reporting units.

There are different configurations for each of the countries, depending on their jurisdictions. And as per the jurisdiction, these configurations are of different complexities, as specified below:

• UAE - Legal Employers and Payroll Statutory Units are the same
  
  
• US - Multiple Legal Employers and Tax Reporting Units
  
  
• France - One Payroll Statutory Unit and two Tax Reporting Units
  
  
• India - One Payroll Statutory Unit and several Tax Reporting Units
  
  
• UK - Multiple Payroll Statutory Units with several Tax Reporting Units
  
  

Creating a Legal Entity

The following steps are to be followed to create a legal entity:

1. Go to the Task Lists and Tasks page and select the Manage Legal Entity task.
   
   
2. Under the dropdown, select Create New and click on the Apply and Go to Task button.
   
   
3. Click on the Create New Legal Entity icon
   
   
4. Enter the details in the fields shown. Select appropriate checkboxes to assign the entity as a PSU and/or Legal Employer
   
   
5. Enter the registration information and click on the Save button. Your legal entity’s address will appear.
   
   
6. After checking the legal entity address, click on the Save and Close button.
   
   

Fig. 1 - Use checkboxes to assign the legal entity as a PSU or Legal Employer (or both)

Selecting the Scope of the Legislative Data Groups

A scope has to be selected for the Legislative Data Groups in order for it to reflect on the legal entities under them. 

The following steps are to be followed to add a scope to the Legislative Data Groups:

1. Click on the Select link next to the Manage Legislative Data Groups task.
   
   

2. Under the dropdown, select the Select and Add option and click on the Apply and Go to Task button.
   
   

3. Search for your legal entity, select it and click on the Save and Close button.
   
   

Fig. 2 - Adding a scope


Fig. 3 - Note the scope added to the tasks on the right

Defining Legal Reporting Units

If more than one legal entity is required, it can be created as follows:

1. Go to the Manage Legal Reporting Unit HCM Information task. (Note: The scope for the Define Legal Reporting Units for Human Capital Management task has to be selected first)
   
   

2. Select the appropriate checkbox for the Legal reporting Unit Classification and click on Next.
   
   

3. Specify the Legal Reporting Unit details and click on the Submit button.
   
   

4. Click on Yes in the following dialog box and click OK.
   
   

Creating Business Units

To create a business unit, the following steps are to be followed under the Manage Business Units task:

1. Go to the Manage Business Units task.
   
   

2. Click on the Create Business Unit icon 

3. Enter the details of the business unit. Search and select the Default Set. Then, click on the Save and Close button.

Krishnaa Lakshmanan

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