Fusion Workforce Compensation Plan Setup
In this article we will configure a compensation plan as per the requirement described in our earlier post Learn Fusion Workforce Compensation Step By Step – Part1 where we also completed few basic setup, prerequisites to define compensation plan. We strongly recommend to go through that post before you proceed here.
Note : If you are looking for Individual compensation plan, you need to read Oracle Fusion Individual Compensation Plan Explained With Examples
Okay so without wasting any more time here are the setup steps
1. Create a Compensation Plan
Navigation : My Client Group » Compensation » Workforce Compensation Plans
To create a compensation plan navigate to Workforce Compensation Plans and under Search Results section click on Create button to create the plan. In the Plan field, enter AP Annual Compensation Plan and click create.
Now you are on Define Workforce Compensation page. (Do not close this page, next step starts from here only)
2. Define Plan Foundation
In the first steps you have merely created the plan name, we now need to add additional details and configuration to the plan. We do them under the Foundation task shown in the image above. There are different task under the plan foundation. We will talk about them one by one.
2.1 Configuring Plan Details
Navigation : Define Workforce Compensation Page » Expand Foundation Task » select Configure Plan Details
Under plan configuration we define the frequency of the plan and also make a key decision in selecting employee population using Employment records to use. On Define Workforce Compensation Page click on Go to Task against task Configure Plan Details and follow below steps
1. In the Plan Details section Frequency field, select Annually.
2. In the Plan Annualization Factor field, enter 1.
3. In the Plan Description field, enter Allocate compensation.
4. In the Employment Records to Use field, select All assignments.
5. In the Action field, select Allocate Workforce Compensation.
6. In the Action Reason, select Anniversary.
Note : Now either you can click on Save and Close to return to the Define Workforce Compensation page or click on Next tab to go to next task in the sequence that is Configure Plan Eligibility. In this practice we will click on Save and Close.
2.2. Configure Plan Eligibility
Navigation : Define Workforce Compensation Page » Expand Foundation Task » Configure Plan Eligibility
This is the place where we decide who will be the part of compensation plan. If you remember our requirement is to add only full time employee who have completed one year in the organization. We have already created these two eligibility profile in our previous article Oracle Fusion Individual Compensation Plan Explained With Examples.
To Configure plan eligibility click on go to task against row Configure Plan Eligibility. On this page follow below steps
1. In the Plan Eligibility section, select Track ineligible workers.
2. On the toolbar, click the Add Row button
3. From the eligibility profile, select Avi Full Time Employee.
4. Select the Required checkbox.
5. On the toolbar, click the Add Row button
5. From the eligibility profile, select Avi Min One Year.
4. Select the Required checkbox.
6. Click on Save and Close to return to the Define Workforce Compensation page
2.3. Configure Plan Cycles
Navigation : Define Workforce Compensation Page » Expand Foundation Task » Configure Plan Cycles
As per the requirement our compensation plan cycle is January to December every year, so we need to configure our plan cycle accordingly. To do so click on the go to task against row Configure Plan Cycles and enter details as follows
1. On the Plan Cycles section toolbar, click the Create button to open the Create Plan Cycle dialog box.
2. In the Name field, enter AP 2021 Review.
3. In the Evaluation Period Start Date field, select 1/1/21.
4. In the Evaluation Period End Date field, select 12/31/21.
5. In the Plan Access Start Date field, select 1/1/21.
6. In the Plan Access End Date field, select 12/31/21.
7. In the Short Name field, enter 2021.
8. In the HR Data Extraction Date field, select 1/1/21.
9. In the Performance Rating Date field, select 1/1/21.
10. In the Default Promotion Effective Date field, select 1/1/21.
11. In the Default Due Date field, select 1/1/21.
12. Click OK.
12. Click Save and Close to return to the Define Workforce Compensation page.
2.4. Configure Plan Hierarchies
Navigation : Define Workforce Compensation Page » Expand Foundation Task » Configure Hierarchies
Using plan hierarchies we define how the hierarchy will be setup, like who will compensate who and who will be the approver etc. To define this click on the go to task against row Plan Hierarchies and enter details as follows
Note : In this exercise you will select Compensation Manager as secondary hierarchy (matrix manager). You can follow this article to see how to create matrix manager » How to Configure & Use Matrix Manager (Dotted Line Manager) in Oracle Cloud HCM but attaching secondary hierarchy is optional. If you dont want to use it just skip step 5 to 8.
1. In the Primary Hierarchy section Source field, select Primary manager hierarchy.
2. In the Missing Manager field, select Leave blank.
3. In the Default Access Level field, select Updates allowed.
4. Select the checkbox Refresh default access level when you run the refresh data process
5. In the Secondary Hierarchy section Source field, select Other manager hierarchy.
6. In the Manager Type field, select Compensation Manager.
7. In the Missing Manager Handling field, select Use primary manager.
8. In the Default Access Level field, select Updates allowed.
9. In the Reviewers section Source field, Primary manager hierarchy.
9. In the Missing Manager field, select Leave blank.
10. In the Default Access Level field, select Updates allowed.
11. Click Save and Close to return to the Define Workforce Compensation page.
2.5. Configure Plan Currency
Navigation : Define Workforce Compensation Page » Expand Foundation Task » Configure Plan Currency
On this page we define what currency manager will see while allocating compensation, can he switch the currency to local currency etc. Allocated budget will always be in corporate currency and employee base salary change will also be in his local currency but during the plan, manager can switch the currency.
To setup this please click on the go to task against Configure Plan Currency and follow below steps.
1. In the Basic Details section Enable Currency Switching list, select Yes.
2. In the Conversion Type field, select Corporate.
3. In the Corporate Currency field, select US Dollar.
4. In the Default Display Currency field, select Corporate currency.
5. Click Save and Close to return to the Define Workforce Compensation page.
2.6. Configure Plan Access
Navigation : Define Workforce Compensation Page » Expand Foundation Task » Configure Plan Access
Plan access is specific to each plan. If other plans should have restricted access, you must configure the access for each plan. When you enable plan access, all roles have no access by default. You must add roles to grant access to the Compensation and the Workforce Compensation work areas. Roles with no update access can only view information.
Please click on the go to task against the row Configure Plan Access and enter details as follows
For this demo we are not going to restrict the plan access so just click on Save and Close without changing anything.
2.7. Configure Feedback Survey
Navigation : Define Workforce Compensation Page » Expand Foundation Task » Configure Feedback Survey
At the end of the compensation cycle when managers have submitted their review you can conduct a survey to check out their experience and all, which you can review later and consider during next plan cycle. To configure this Feedback survey click on the Go to task against Configure Feedback Survey row and follow below setup. Remember this is option, you can skip this step also.
1. In the Manager Feedback section Enable Feedback Survey field, select Yes.
2. In the Enable Ratings field, select Yes, if not already selected.
3. In the Rating Details section Special Instructions field, enter Rate your overall experience of this compensation cycle.
4. In the Survey Questions section Question 1 field, enter Do you think articles on iavinash.com helped you to understand the compensation cycle better?.
5. Click Save and Close to return to the Define Workforce Compensation page.
After this we have also completed all tasks under the Plan Foundation.
3. Define Plan Budget
Navigation : Define Workforce Compensation Page » Expand Budgets Task
Budgeting is optional. If you choose to enable it, you create one or more budget pools and link them to particular compensation components. You Can :
- Have separate budgets for each component.
- Link a budget to more than one component.
Note: You can hide a budget pool from managers, but allow administrators to see when acting as proxy.
Also make yourself familiar with following concept and terminology
Budgeting Method
Distribute the budget at the manager or worker level.
- Manager Level Budgeting : Higher level managers distribute budgets to lower level managers.
- Worker Level Budgeting : Line managers allocate budgets to individual workers. The sum of all individual worker budgets determines a manager’s overall budget.
Budget Storage Method
- Amount : Manager’s budget does not change when workers move to another manager’s worksheet or a workers eligible salary changes.
- Percentage : Manager’s budget changes dynamically when workers are reassigned between worksheets, lose or gain eligibility, or eligible salary changes.
Budget Publishing : Automatically publish budgets to all managers when the compensation cycle is started.
To define budget for this exercise we will follow following steps
3.1. Configure Budget Pools
Navigation : Define Workforce Compensation Page » Expand Budgets Task » Configure Budget Pools
To enable budget click on the go to task against the row Configure Budget Pools and follow below steps.
1. In the Budgeting section Enable Budgeting field, select Yes.
2. On the Budget Pools section toolbar, click the Create button to open the Create Budget Pool dialog box.
3. In the Pool Name field, enter AP Bonus Budget.
4. In the Display Order field, enter 1.
5. In the Budget Storage Method, select Percentage.
6. Select Allow over budget when budgeting.
7. For Maximum Percentage Over Allocation, enter 10
8. Select Allow over budget when allocating compensation.
9. For Maximum Percentage Over Allocation, enter 10
10. For
11. Click OK, to return to the Configure Budget Pools page.
Create another budget pool as shown below
1. On the Budget Pools section toolbar, click the Create button to open the Create Budget Pool dialog box.
3. In the Pool Name field, enter AP Merit Budget.
4. In the Display Order field, enter 2.
5. In the Budget Storage Method, select Percentage.
6. Select Allow over budget when budgeting.
7. For Maximum Percentage Over Allocation, enter 10
8. Select Allow over budget when allocating compensation.
9. For Maximum Percentage Over Allocation, enter 10
10. For
11. Click OK, to return to the Configure Budget Pools page.
Click Save and Close to return to the Define Workforce Compensation page.
3.2. Configure Budget Display
Navigation : Define Workforce Compensation Page » Expand Budgets Task » Configure Budget Display
For each budget we can configure how the budget details page appears to the line manager. We can configure the budget page for each budget pool, optionally, import the configuration from one budget pool in one plan to another budget pool in a different plan. In the exercise below you will get a feel of that but this is not very much required for our requirement. But suggest you to follow the below steps.
1. In the Budget Pools section AP Bonus Budget row, click the Configure button to open the Configure Budget Page Layout page.
2. Select the Detail Table tab.
3. In the Detail Columns section, expand Budget Distribution.
4. In the Budget Distribution Percentage row, click the Configure Column Properties button.
5. In the Rounding Rule field, select Round to nearest .1
6. Change the Decimals Places to Display value to 2
7. Click on Save and Close button to return to the Configure Budget Display Layout page.
8. Click Save and Close to return to the Configure Budget Display page.
9. Click Save and Close to return to the Define Workforce Compensation page.
Fusion Compensation Remaining Setup
At this moment we have configured a compensation plan and defined the foundation, we have also done the budget setup but its not over yet. We also need to configure worksheet and its components through which manager will allocate compensation to workers. All of these are explained here Fusion Workforce Compensation Plan Setup – Part3
