Legal entity and legal employer
ConceptfoundationAn organisation recognised in law, with rights and responsibilities. A legal entity designated as a legal employer and payroll statutory unit is the entity payroll actually pays through.
What people get wrong
The confusions are the difficulty. Each one is a belief that sounds right and is not.
- That business unit membership implies who employs a worker. It does not; the legal employer designation is set on the legal entity.
- That time missing from a payslip means payroll is misconfigured. It frequently means the payroll relationship names an entity that does not employ in that country.
Recall it
Which object determines who employs a worker, and where is that determination actually stored?
The legal entity determines who employs a worker, and the determination is the legal employer designation stored on that entity. Business unit membership does not imply it. Payroll pays the legal employer and payroll statutory unit, so if that designation is missing or names an entity that does not employ in the worker country, time can validate, transfer and arrive at payroll and still never be paid.
Memory hook: Business unit says where the work happens. Legal employer says who is on the hook for it. Only the second one pays anybody.
Rests on COREHR-ORDER-002.
Taught in
- Configuration order, and the failures it preventsSeven setup steps in dependency order, two of them decisions that can fail. Get the order wrong and the application rejects children without saying which parent it wanted.
- Three Structures, Three Functional Areas, and Where Each Setting LivesLegal, managerial and functional are three axes rather than one nesting — and their setup tasks are split across three functional areas, with one record that is created in one work area and revised in another.
Related
- Terminology glossary — what a term means, and what people get wrong when they use it