SAP ERP system uses Payroll Areas to group employees for whom payroll should be run together, and at the same time. You can perform payroll separately for different employee groups, using different payroll areas. Which payroll area the employee belongs to depends on his or her organizational assignment. Employees who belong to different company codes can, for example, be grouped in the same payroll area.
SAP recommends that you use few Payroll areas as possible. For example, an organization may pay employees on 28th of the current period and another at the beginning of the subsequent month so at least two payroll areas must be created.
When you run payroll, you must specify the payroll area in the payroll driver selection screen. The Payroll Area has the following functions:
* Determines the exact Payroll Period.
* Select the personnel numbers grouped under the Payroll Area.
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