By: Moorthi

Wage types are payroll objects used to store payroll components which include the amount, number and rate. SAP has standard model wage types for different country versions and depending upon your payroll implementation you should copy model wage types from the correct country versions only. 

The wage types are broadly classified into primary/dialog and secondary/technical or slash wage types. Dialog wage types are those in which you can store values in the wage types through the permissible payroll infotypes. The technical or slash wage types are those wage types that are create during the payroll run only eg /101 – Total gross amount, /550 – Statutory Net, /559 – Bank Details. 

Wage types are permitted to be stored in payroll infotypes only if these are added to the wage type groups. Eg Basic Pay IT0008 has wage type group 0008. Please note that not always do Infotype no = wage type group. 

Transaction pu95 is used to edit wage type groups. You need to assign the wage types to the respective employee sub group groupings and personnel subarea groupings wherever configuration permits for the wage types to be associated with the enterprise and personnel structure.  All wage types are not permissible for all infotypes (refer wage type groups concept). 

The wage type characteristics are attributes of the wage type as to what is permissible and not permissible, what are the maximum and minimum value limits , what are the units permissible, whether they are to be valuated directly (values entered) or indirectly (values as a reference to other wage type values). 

You valuate wage types directly or using indirect valuation. You configure these in the wage type characteristics and the corresponding indirect valuation tables where the corresponding wage types from where the indirect values are figured out (these need to exist). Module names are names given to different types of modules that valuate wage types according to certain criteria eg TARIF, PRZNT etc. Variations in the module valuation process are further provided by the specific module variants. For eg for TARIF module the variants could be A, B, C and D. TARIF provides valuation according to payscale group or/and level, SUMME & PRZNT are valuation using the basic pay(IT0008)wage types. The 'SUMME' module corresponds to the 'PRZNT' module except that the value of the wage type to be valuated indirectly is always the entire basic pay.

How to assign wage type to adjustment in compensation module?

I have some problem in assigning wage type to adjustment in compensation. 
In IMG( Compenation management--> Adjustment--> Define wage type models for adjustment), I set wage types for adjustment, however, I cannot figure out how to integrate wage types with adjustment.  In "Define adjustment"(IMG) there is no column where I can set wage type.

You first select the model. For the model, define the wagetype (eg. CM01). You assign the model to the adjustment type. Then when you actually do the adjustment, the system will use the wage type in creating an IT 0380 and also update 0008.

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