What is external wage component in SAP (PY - Payroll)?

SAP Term: external wage component

• Component: PY

• Component Name: Payroll

• Description: A part of an employee's payments and deductions that is transferred from an external application to the SAP HR System, where it is then processed. &EXAMPLE& An external wage component can result from a commission settlement in a non-SAP System. An external wage component can result from an employee using a purchase system or portal to buy goods whose purchase price must then be deducted from the employee's salary.

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• Key Concepts: 
  External wage components are additional payments made to employees that are not part of the regular salary. These payments can include bonuses, overtime pay, and other forms of compensation. They are typically managed outside of the payroll system and are not included in the employee's regular salary. 
  
  How to use it: 
  In SAP Payroll, external wage components can be managed through the “External Wage Components” feature. This feature allows users to enter and manage external wage components for each employee. The user can enter the amount of the payment, the date it was paid, and any other relevant information. The system will then calculate the total amount of external wage components for each employee and add it to their regular salary. 
  
  Tips & Tricks: 
  When entering external wage components into SAP Payroll, it is important to ensure that all relevant information is entered accurately. This includes the amount of the payment, the date it was paid, and any other relevant information. Additionally, it is important to ensure that all payments are entered in a timely manner so that they can be included in the employee's regular salary calculation. 
  
  Related Information: 
  For more information on managing external wage components in SAP Payroll, please refer to the official SAP documentation on this topic. Additionally, there are many online resources available that provide detailed instructions on how to use this feature in SAP Payroll.