Overview
Penalties are a result of entities not complying with the laws and regulations governing the Social Security Services. Penalties can be applied to employers, individuals, and/or beneficiaries who fail to comply with specific laws of the Social Security regulations. A penalty can be either monetary or non-monetary. In the case of a Monetary Penalty, the concerned party will be served with a Penalty Notice explaining the reason(s) for the Penalty and the amount to be paid (Fine) to settle the penalty. In case of a non-monetary penalty, the concerned party will be served with a Penalty Notice, which includes the reason of the penalty and the explanation of the non-monetary penalty, which can include Termination of Benefits, Revocation of a Business License, etc.
Framework
The Penalties Module Framework consists of the processes that may initiate a Penalty Notice as a result of an action within the process, and these processes include the Compliance Management and Delinquency Management. Additionally, the Payment Management Module is interfaced to the Receivables module in case the Penalty is monetary, in this case a trigger is sent to the Receivables Management module to issue an Invoice for the Penalty.
Figure 1: Penalties Management Framework
The entities involved in the Penalties Management process, include Employers, Individuals, and Beneficiaries. The Penalties can be applied to any of these entities.
Creation of Penalty Notice:- There are three ways in which the Penalty Notice can be created: one method is manual and the other two methods are automatic:
- Manual – This is when the user creates a Penalty Notice using the Penalty Notice form. Once the Penalty Notice is manually created and approved, the system will automatically invoke the Penalty Script defined in the Penalty Policy definition of the Penalty Policy selected in the Penalty Notice form.
- Automatic – The Penalty Notice will be automatically invoked through the following modules:
a.Contribution Filing and Payment Module – When the Contribution Payment process is launched, the system will automatically check the delay in the payments and create the Penalty Notice automatically. The user will be alerted that a payment is delayed, and a Penalty Notice will be created and displayed for the Penalty Notice to be reviewed and confirmed. Once the user confirms the Penalty Notice, the system will post the Penalty Notice for review and approval.
b.Compliance Module –As a result of a Compliance Process, such as a Compliance Audit, a Compliance Audit Action can be chosen or recommended to apply a Penalty. Or the choice of Penalty can be chosen as the Legal Action, in which case the system will display the Penalty Policies, and the user will select the desired Penalty Policy. After approval of the Compliance Audit, the system will automatically create the Penalty Notice. The user will be alerted that a Penalty Notice is created, and a Penalty Notice will be created and it will display the Penalty Notice to review and confirm. Once the user confirms the Penalty Notice, the system will post the Penalty Notice for review and approval.
c.Delinquency Module –If the Delinquency Request Action is chosen as “Penalty” by selecting the “Penalty Policy” in the Delinquency Request form, the system will automatically create the Penalty Notice. The user will be alerted that a Penalty Notice is created, and a Penalty Notice will be created and it will display the Penalty Notice to review and confirm. Once the user confirms the Penalty Notice, the system will post the Penalty Notice for review and approval.
Penalty Notice Rejection – Users can Reject a Penalty Notice when reviewing a Penalty Notice form and this Rejection will need to be Reviewed and Approved for it to be final.
Penalty Notice Cancellation – Users can also choose to Cancel a Penalty Notice after it was originally Approved, for example if the circumstances affecting the Penalty Notice have changed.
Review and Approval of Penalty Notice – The Review and Approval is based on the General Setup of the Penalty Management and the Penalty Policy Definition. Depending on the setup, the following will take place:
Figure 2: Penalties Management Interfaces
Penalties Interface – This interface is used to create Penalty Notices by reading the entries in the Penalties Notices Queue. The Penalties Notices Queue is populated by the three modules including Contribution Payment Management, Compliance Management, and Delinquency Management. Once a Penalty-based transaction is approved in any of these modules, the relevant module creates a Penalty Notice Entry in the Penalties Notices Queue. The Penalties Management Service in turn, reads the entries in the Penalties Notices Queue and creates the Penalties Notices. The Penalties Management Service is a background service that runs forever and based on its setup, it picks up the Penalties Notices Queue and creates the Penalties Notices, and marks those entries as processed.
Receivables Interface – This interface is used to create Invoices by reading the entries in the Invoices Queue. The Invoices Queue is populated by the Penalties Management Module. Once a Penalty Notice is approved, the system creates an Entry in the Invoices Queue. The Receivables Management Service in turn, reads the entries in the Invoices Queue and creates the Invoices. The Receivables Management Service is a background service that runs forever and based on its setup, it picks up the Invoices Queue and creates the Invoices, and marks those entries as processed.