 Compensation

 Compensation Framework
o Steps: Set Up the Compensation Framework
o Create Frequencies
o Create Compensation Elements
o Create Compensation Packages
o Create Eligibility Rules for Compensation
o Assign Compensation Components to an Eligibility Rule
o Set Up Compensation Package Analytics
o Concept: Pay Equity Dashboard
 Guidelines: Grades and Grade Steps
o Steps: Set Up Compensation Grades and Grade Steps
o Create Compensation Grades
o Create Compensation Grade Steps
o Set Up Adjustments to Compensation Steps
o Create a Compensation Grade Hierarchy
o Set Up Automatic Compensation Grade Step Progression Schedules
o Request Grade Change
o Set Up Adjustments to Compensation Grades Assigned to Job Profiles
o Reference: Compensation Grade and Pay Range Security
o Reference: Compensation Step and Grade Progression Reports
o FAQ: Compensation Defaulting
 Guidelines: Grades and Grade Steps
o Steps: Set Up Compensation Grades and Grade Steps
o Create Compensation Grades
o Create Compensation Grade Steps
o Set Up Adjustments to Compensation Steps
o Create a Compensation Grade Hierarchy
o Set Up Automatic Compensation Grade Step Progression Schedules
o Request Grade Change
o Set Up Adjustments to Compensation Grades Assigned to Job Profiles
o Reference: Compensation Grade and Pay Range Security
o Reference: Compensation Step and Grade Progression Reports
o FAQ: Compensation Defaulting
 Manage Compensation
o Propose Compensation for Employees or Positions
o Roll Out Compensation Plans to Multiple Employees
o Remove Compensation Plans from Multiple Employees
o Remove Compensation Plans with Expected End Dates
o Set Up Segmented Security by Compensation Plans
o Restrict Viewing of Merit, Bonus, and Stock Plan Assignments
o Set Up Adjustments to Unit Salary, Hourly, Allowance, and Commission Plans
o FAQ: Propose Compensation
o Reference: Compensation Plan Comparisons
 Salary
o Steps: Set Up Salary Plans
o Create Salary Plans
o Create Unit Salary Plans
o Create Period Salary Plans
 Hourly
o Create Hourly Plans
o FAQ: How do I annualize hourly plans?
 Allowance
o Steps: Manage Reimbursable Accounts
o Create Allowance Plans
 Merit
 o Steps: Set Up Merit Plans
o Create Merit Plans
o Steps: Create Custom Merit Statements
 Bonus
o Steps: Set Up Bonus Plans
o Steps: Pay for Company Performance
o Steps: Set Up Eligible Earnings Overrides for Bonuses
o Create Bonus Plans
o Create Compensation Scorecards
o Create Compensation Scorecard Results
o Create Eligible Earnings Overrides for Bonuses
o Create Deferred Bonus Calculations
o Create Future Payment Plans
o Assign Future Payment Plans to Employees
o Calculate Outstanding Balances for Future Payment Plans
o Rescind Bonuses for Individual Employees
o Concept: Company Performance Options
o Concept: Future Payment Plans and True Ups
o Example: Deferred Bonus Progressive Calculation
 Stock
o Steps: Set Up Stock Plans
o Create Stock Plans
o Request Stock Grants
o Add Stock Grants
o Create Stock Participation Rate Tables
o Update Approved Stock Grants
 Set Up Compensation Reviews
o Steps: Create a Compensation Matrix
o Steps: Prepare for Compensation Reviews
o Set Up Compensation Review Business Processes
o Steps: Set Up Shared Participation Compensation Reviews
o Create Eligibility Waiting Periods for Merit and Bonus Processes
o Create Time Proration Rules for Merit and Bonus Processes
o Create Compensation Rounding Rules
o Create Compensation Review Participation Rules
o Create Grid Configurations for Compensation
o Create Shared Participation Compensation Review Options

Understanding Compensation Reviews

 Concept: Shared Participation Compensation Reviews

 Concept: Coordination of Events During Compensation Reviews
 Example: Coordination of Events in Compensation Reviews
 Example: Participation Rules and Coordination of Events
 Example: Time-Based Proration for Merit and Bonus Awards
 Example: Include Active Employees Assigned Plan During Process Period
 FAQ: Compensation Reviews
 FAQ: Merit, Bonus, and Stock Pool Calculations
 FAQ: How is Total Eligible Earnings calculated for a compensation review?
 Reference: Participation Options
 Reference: Terminations During Compensation Review Processes

Manage Compensation Reviews

 Initiate Compensation Review Processes

 Add or Remove Employees to or from Compensation Review Processes
 Manage Multiple Events During Compensation Reviews
 Manage Compensation Review Pools
 Manage Awards for Compensation Reviews
 Review Promotions in a Merit Process
 Release Merit Statements
 Manage Funding for Bonuses
 Commission
o Create Commission Plans
 One-Time Payment
o Steps: Manage One-Time Payments
o Create One-Time Payment Plans
o Request One-Time Payments for Employees
 Calculated Plans
o Steps: Manage Calculated Plans for Compensation
o Concept: Calculated Plans for Compensation
 Compensation Basis
o Steps: Manage Compensation Basis
o Create Calculation Compensation Basis
o Create Configurable Compensation Basis
o Concept: Compensation Basis
 Compensation Statements
o Steps: Create Wage Theft Notices
o Steps: Set Up Total Rewards Statement
o Create Total Rewards Templates
o Create Statutory Compensation Statements
 Severance
o Steps: Manage Employee Severance
o Create Severance Matrix
o Create Severance Packages
o Create Severance Worksheets for Workers
o Complete Severance Package Assignments
o Request Compensation Change After Termination
 Market Salary Data
o Steps: Set Up Market Salary Data
o Create Benchmark Jobs

Compensation Framework
Steps: Set Up the Compensation Framework

Context
Create the compensation components that make up Workday compensation used in
your organization.

Steps
1. Create Frequencies.

Define frequencies for use in compensation and payroll calculations.

2. Define units of measure.

 For compensation plans that have targets that are based on units, use the
Maintain Units of Measure task to define those units.

Security: Set Up: Unit of Measure domain in the Common Financial Management
functional area.

3. Create Compensation Elements.

Compensation elements are the link between compensation and payroll.

4. Create Compensation Packages.

5. Create Eligibility Rules for Compensation.

Define the rules that determine the groups of employees who are eligible for the
different compensation plans.

6. Assign Compensation Components to an Eligibility Rule.

Assigning compensation components to an eligibility rule enables staffing

transactions (such as hire, promote, and transfer) to automatically populate
compensation components to qualifying employees.

7. Set Up Compensation Package Analytics.

Define the information and error messages you want to display on various
compensation-related tasks.

8. (Optional) Create Compensation Rounding Rules.

9. (Optional) Create Compensation Review Participation Rules.
10. (Optional) Steps: Manage Compensation Basis.
11. (Optional) Set Up Segmented Security by Compensation Plans.

Note: Intersection security isn't available for Compensation.

Related Information
Reference
Reference: Compensation Plan Comparisons

Create Frequencies

Prerequisites
Security: Set Up: Compensation General domain in the Core Compensation functional
area.

Context
Define frequencies for use in compensation and payroll calculations. Workday supplies a
set of frequency types. You can modify them or add variations as needed. Example: If
the standard number of working hours differs between locations, you can create
different hourly frequency for each.

Steps
1. Access the Maintain Frequencies task.
2. As you complete the task, consider:

ption Description

Annualization The number of units in a year.

Factor
Example: The annualization factor for hourly is 2080, which is the number of work
weeks).

Workday uses the annualization factor to calculate the annual compensation from
frequency.

Use Weekly For Hourly frequency types:

Hours
 If selected, Workday uses the number of hours per week the employee is s
This is useful for part-time employees.
 If cleared, Workday calculates the annual equivalent.

If you use Workday Payroll, select this check box for hourly workers. If cleared, W
full-time. Example: For Commitments and Obligations, Workday might create com

Your selection affects how Workday evaluates grade range penetration for an hou
equivalent of hourly pay.

Example: The position data for a worker indicates that he's scheduled to work 20

 If you select the Use Weekly Hours check box, Workday multiplies the w
Hours value, then by a Weekly Annualization Factor of 52:

Annual equivalent of 10,400.00 USD = (10 USD x 20 hours) x 52 weeks.

 If you clear the Use Weekly Hours check box, Workday multiplies the wo
Factor of 2080 instead of the Weekly frequency type. Workday treats the

Annual equivalent of 20,800.00 USD = 10 USD x 2080 hours.

Used in Payroll Select the check box to make a frequency definition available for use in positions
Interface external payroll.

Create Compensation Elements

Prerequisites

 Create the earning codes that you want to associate with the base pay compensation
elements:
o Create earnings in Workday Payroll.
o Maintain external payroll earnings for the Payroll Interface.
 Security: Set Up: Compensation Elements domain in the Core Compensation functional
area.

Context

Compensation elements link compensation and payroll. When a compensation element is

attached to a plan that is assigned to an employee, Workday can determine which earnings to use
to pay the employee.

Steps
1. Access the Maintain Compensation Elements task.
2. Consider:

Option Description

Period Activity Pay Enabled Displays if the Enable Period Activity check box is selected in the Education

Compensation elements enabled for Period Activity Pay aren't available for sta

Academic Pay Enabled Displays if the Enable Educational Institution Features check box is selecte

Select the check box if this compensation element can be paid in a different per

Payroll Earning Select the values that apply to all your payroll entities.

External Payroll Earnings Select the earnings that apply to each payroll entity.

Next Steps

You can use Maintain Compensation Element Groups task to group compensation elements.
If you've more than 1 compensation element that defines base pay, create a compensation
element group to associate base pay compensation elements.

Related Information
Tasks
Steps: Create Earnings
Steps: Set Up the Compensation Framework
Manage External Payroll Earnings

Create Compensation Packages

Prerequisites
 Create 1 or more compensation plans to include in the compensation package.
 Create compensation eligibility rules.
 Security: Set Up: Compensation Packages domain in the Core Compensation
functional area.

Context
Compensation packages group compensation guidelines (grades, grade profiles, and
their associated steps) and compensation plans. A compensation package enables you
to assign grades and plans to a worker simultaneously during a staffing transaction.
This can be accomplished through eligibility rules.

To have compensation components automatically populate for eligible employees

during staffing transactions, assign an eligibility rule to a compensation package and
associate the default grade, grade profile, and 1 or more plans with that package.

Steps
1. Access the Create Compensation Package task.
2. (Optional) Select one or more Eligibility Rules to establish who is eligible for
this package.

If you select multiple eligibility rules, Workday evaluates each rule

independently. Employees are eligible if they meet the qualifications of any 1
rule.

3. Select the Compensation Grades to associate with this package.

Accessible by Users Granted Segment is available only if segmented security

for compensation is set up.

4. Select the Compensation Plans to associate with this package.

For eligibility rules to work during staffing events, associate plans with packages.

You can assign multiple salary plans to compensation package but each plan
requires its own compensation rule.

5. (Optional) Select the Compensation Basis to associate with this package.

This section is required for Workday to allocate compensation awards to plans

that make up an employee's compensation basis. You can use a total
 compensation amount to manage merit process awards or other compensation
change events.

You can only select compensation bases that have the Manage Basis Total
check box selected.

Next Steps
 Use the Edit Compensation Package task to update the package.
 Assign packages to employees or update an employee's package:
o As part of the hiring process (initial assignment only).
o As part of the promote, demote, and transfer staffing transactions.
o Using the Request Compensation Change task.

Related Information
Tasks
Create Compensation Grades
Create Compensation Grade Steps
Propose Compensation for Employees or Positions

Create Eligibility Rules for Compensation

Prerequisites
 Set up objects, such as job profile or location, that form the basis for eligibility
rules.
 Security: Set Up: Compensation Rule domain in the Core Compensation
functional area.

Context
You can configure eligibility rules that determine the workers eligible for compensation
components (packages, grades, grade profiles, and plans). To populate compensation
components, you can use eligibility rules. Examples:

 When proposing compensation during the Offer or Employment Agreement

business processes.
 When creating a job requisition.
 When you assign, roll out, or remove a new or updated compensation plan to
employees defined by an eligibility rule.
 When creating a referral one-time payment.

Steps
1. Access the Create Compensation Eligibility Rule task.
2. (Optional) Select 1 or more rules from which to copy conditions to the Rule
Conditions grid.
3. For each rule condition, consider:
 1.

ption Description

Source External Field or The type of field or condition rule you select determines the other availab
Condition Rule

Relational Operator Options depend on the data type. Example: A contains operator applie
to numbers or currency, but not text.

Comparison Type Specify whether to compare the source to another field or to a value you e

Comparison Value Select a comparison field or enter a value to compare to the source.

Order Use arrows to control the processing order of statements.

2. (Optional) Add a row to include another statement.

3. When 2 or more logical statements exist, set the And or Or options control how
it's used with the preceding line.
o All conditions in an expression connected by And must be true for the
expression to be true.
o At least one of the conditions in an expression connected by Or must be
true for the expression to be true.
4. Use the parentheses columns when you need 3 or more logical statements and a
combination of And and Or options.

Example: To say (a and b) or c:

o Use the opening parenthesis at the beginning of statement a.

o And before statement b and a closing parenthesis at the end of statement
b.
o Or at the beginning of statement c.

Result
When you assign compensation components to employees, the eligibility rules
determine which ones are available for selection in the By Compensation Rule prompt
folder.

Example
You require an eligibility rule that states an employee is eligible when both rule
conditions a and b are true, or if rule condition c is true. In short, if (a and b) or c are
true. Assume also that a is Location equals Paris, b means that Job Exempt is true, and
c means that Job Family is Executive. The employee is eligible or not eligible under
these conditions:

 Eligible if Location is Paris and Job is Exempt.

 Not eligible if Location is Paris but Job is non-Exempt.
 Not eligible if Location is Pleasanton and Job is Exempt.
 Eligible if Job Family is Executive.
 Not eligible if Job Family is Individual Contributor.

Next Steps
 Access the Assign Compensation Components to Rule task to assign
eligibility rules to compensation components.
 Run the Compensation Eligibility Rules report.

Related Information
Tasks
Propose Compensation for Employees or Positions

Reference
FAQ: Compensation Defaulting

Assign Compensation Components to an Eligibility Rule

Prerequisites
 Define the compensation components to assign to the eligibility rule.
 Security: Set Up: Compensation Rule domain in the Core Compensation
functional area.

Context
Assign compensation components to a compensation eligibility rule so that staffing
transactions (hire, promote, demote, transfer) automatically apply the default
compensation components to eligible employees.

Note: You can also assign eligibility rules to a compensation component at the time you
create or edit it.

Steps
1. Access the Assign Compensation Components to Rule task.
2. Select the Compensation Packages, Compensation Grades, Compensation
Grade Profiles, and Compensation Plans that you want to associate with the
rule.
 Those components already assigned to the current rule display here
automatically.

If you've already assigned the eligibility rule through the compensation

component definitions, those components display here automatically.

Set Up Compensation Package Analytics

Prerequisites
Security: Set Up: Compensation Packages domain in the Core Compensation functional
area.

Context
Define which pay ranges, segments, compa-ratio, compensation package analytics, and
error messages you want displayed on compensation-related reports and tasks, such as:

 Request Grade Change

 Request Compensation Change
 View Compensation
 Direct Report Compensation Summary

Steps
1. Access the Edit Compensation Package Analytics task.
2. (Optional) Select Display Midpoint.

If selected, the midpoint of the pay range displays on the Request

Compensation Change task and in the Propose Compensation step of business
processes.

The compensation package must include the grades to display the midpoint.

3. Select the method for displaying Guidelines Warnings:

Option Description

1.

Option Description

Based On Total Base Pay Pay Range Warning messages display for values that are above an
 Option Description

Based On Primary Compensation Basis Pay Warning messages display for values that are above an
Range basis.

2. (Optional) In the Pay Range Analytics section, select:

o Hide Compa-Ratio.
o Hide Compensation Package Analytics.

Doing so hides compa-ratio or compensation package analytics from those

security groups that have access to Compensation > View Compensation.

Related Information
Tasks
Create or Edit Custom Labels

Concept: Pay Equity Dashboard

The Pay Equity dashboard (secured to the Pay Equity Dashboard domain) enables you
to monitor and report on potential gender pay equity issues.

Workday recommends that you consult with your legal team about access to sensitive
pay equity data before adding any security groups to the Pay Equity Dashboard domain.

 Select the Enable Worker Trending check box on the Edit Tenant Setup -
Reporting and Analytics task.
 Set up a security group that is unconstrained and has access to these domains:
o Pay Equity Dashboard in the Core Compensation functional area.
o Worker Data: Compensation by Organization in the Core Compensation
functional area.
o Public Reporting Items in the Tenant Non-Configurable functional area.
o Trended Worker Data in the Staffing functional area.
o Worker Data: Current Staffing Information in the Staffing functional area.
o Worker Data: Public Worker Reports in the Staffing functional area.
o Person Data: Gender in the Personal Data functional area.
o Worker Data: Performance Reviews in the Performance and Goals
functional area.

Workday delivers the dashboard empty. After you've set up security, we recommend
that you add these reports to the dashboard, configured as worklets:

 Average Compa-Ratio by Country & Gender

 Average Compa-Ratio by Gender
 Average Compa-Ratio by Job Family Group & Gender
 U.S. Average Base Pay by Performance Rating & Gender
You can also run these reports individually or use them to create custom reports.

Related Information
Concepts
Concept: Dashboards

Tasks
Configure Dashboard Content

Reference
Reference: Edit Tenant Setup - Reporting and Analytics

Guidelines: Grades and Grade Steps

Steps: Set Up Compensation Grades and Grade Steps

Prerequisites
Set up the compensation framework.

Context
Manage compensation grades, eligibility rules, pay ranges, grade steps, and grade
profiles.

Steps
1. Create Compensation Grades.

Create compensation ranges for jobs and job profiles.

2. Create Compensation Grade Steps.

Create the grade steps that assign specific monetary amounts to workers.
Configure the length of time that workers must remain in a step before
progressing.

3. Set Up Adjustments to Compensation Steps.

Make adjustments to compensation steps associated with a compensation grade.

Workday automatically adjusts the amount for all employees with those steps.

4. Create a Compensation Grade Hierarchy.

Create a superior-subordinate relationship between grades.

5. Set Up Automatic Compensation Grade Step Progression Schedules.

 Configure automatic compensation grade step progression schedules to ensure
that regulatory or workplace policies for step progression occur on time.

6. Request Grade Change.

Request a change in grade for an employee.

7. Set Up Adjustments to Compensation Grades Assigned to Job Profiles.

Update the grade assigned to a job profile or to employees in that job profile.

Related Information
Reference
Reference: Compensation Grade and Pay Range Security
Reference: Compensation Step and Grade Progression Reports

Create Compensation Grades

Prerequisites

 Set up the compensation framework.

 Create eligibility rules for compensation.
 Create frequencies.
 Security: Set Up: Compensation Packages domain in the Core Compensation functional
area.

Context

Grades define the standard compensation range for a given job or job level. You can associate
more than 1 compensation basis and pay range to a grade.

Steps
1. Access the Create Compensation Grade task.
2. Consider:

Option Description

Pay Range Segments Enter 3, 4, or 5 to define the number of segments you want the pay range

Example: If the pay range is 45,000 - 100,000 USD and you select 3, then t

 45,000 - 63,333 USD

 63,333 - 81,666 USD
Option Description

 81,666 - 100,000 USD

Use Grade Profiles Select this check box if you want to use eligibility rules to create more gran

Example:

 Default range = 45,000 USD - 100,000 USD

 New York range = 55,000 USD to 120,000 USD

 If you selected both of these check boxes:

o Apply FTE% on the salary plan.
o Use 100% FTE for Pay Range Comparisons in the Compensation
section on the Edit Tenant Setup - HCM task.

Workday divides the employee salary by the FTE % before comparing it to the
salary range midpoint when calculating these fields:

o Compa-Ratio
o Position in Range
o Pay Range Segment
 In the Default section, consider:

Option Description

Base Pay Select the compensation elements you want to associate with this grade.
Elements
Workday only includes hourly, salary, and allowance plans categorized as base pay to

Eligibility Select 1 or more rules to use to determine who is eligible for this compensation compo
Rules
When you assign compensation to employees, the eligibility rules determine whether
By Compensation Rule prompt folder.

If you select multiple eligibility rules, Workday evaluates each rule independently to de
compensation component. Employees are eligible if they meet the qualifications of an
in the grade and grade profiles.
Enter default compensation pay ranges in the Compensation Basis section and
consider:

Option Description

Calculate Select this check box if you want Workday to calculate the values for the segment t
Option Description

Segments

When selected, only the Minimum and last segment top fields are available for ent
automatically calculates the other segment tops and midpoint.

Segment # This is the top value for the segment. The last segment top is the maximum value f
Tops

Midpoint You can enter the midpoint when the Calculate Segments check box is cleared.
Workday uses the Use Calculated 50% option to calculate compa ratio instead of th

 Change the midpoint to be anything other than 50% of the range, and
 Have the Use Calculated 50% option selected for Compa-Ratio Midpoint fi

1. (Optional) If you selected the Use Grade Profiles check box, enter your grade
profiles in the Compensation Grade Profiles tab.

A grade profile must have a pay range associated with Total Base Pay. You can't
change the number of pay range segments for profiles, the number is the same
as the grade defaults.

You can drill down to details on any job profiles that reference this grade.

Grade profiles don't display if their number exceeds 250.

Result
Workday uses grades to calculate compa-ratio and pay range segments. Grades are
guidelines used in determining compensation for a worker.

If proposed compensation for an employee extends beyond the limits of the reference
pay range for the employee's grade or grade profile, Workday issues a warning but
permits submission of the proposed compensation. Reviewers and approvers can then
evaluate whether to approve the proposal.

Next Steps
To associate a grade to a job profile, use the Create or Edit Job Profile tasks.

Create Compensation Grade Steps

Prerequisites

 Create compensation grades.

  Security: Set Up: Compensation Steps domain in the Core Compensation functional area.

Context

A step is a specific point in a compensation grade or grade profile salary range that is associated
with a monetary amount. Steps, like compensation plans, assign a specific monetary amount to a
worker.

If you assign a grade profile to a worker's compensation package, Workday uses the steps on the
grade profile, not the steps on the grade.

Steps
1. Access the Maintain Compensation Steps task.
2. Select the Assign 1st Step at Hire check box to assign the first compensation step to workers
associated with their grade or grade profile when hired.

If selected, Workday determines if:

o The worker has an eligible compensation grade.

o The grade has compensation steps.
o The worker either doesn't have a step assigned or doesn't have a step in the grade assigned.

If all of these conditions are met, Workday assigns the first compensation step.

3. In the Grade Steps tab, consider:

ption Description

Salary Pay Plan Select the salary or hourly plan you want to associate with these steps.

Allow Override Select this check box to allow the overriding of the step values in a specific wo

1. In the Steps section of the Grade Steps tab, consider:

Option Description

Sequence Identifies the step progression order for workers assigned to the grade or grade

Enter any unique and sortable character string, such as 1-2-3 or A-B-C.

Workday sorts the sequence by character. So if you use numbers, use 01 for 1, 0
 Option Description

Interval and Period Define the length of time that workers must remain in the step before progressin

The interval must be a positive whole number, such as 6 Months or 2 Years or 1

(Optional) Progression Rule Select an eligibility rule for Workday uses to progress workers.

Examples: Age, length of service, job profile, or collective agreement.

2. (Optional) In the Grade Profile Steps tab, you can define a step on a profile.

If there are no profiles associated with the selected salary pay plan, then you
can't add grade profile steps.

When you propose a worker's compensation and they match the eligibility rules
on the grade profile, Workday uses the values associated with the grade profile
steps, not those on the Grade Steps tab.

Result
 To view which compensation step is assigned to the worker, select
Compensation > View Compensation as a related action off the worker.

 Next Steps
 Assign steps to employees as part of staffing transactions based on your
compensation package and compensation defaulting rules.

 Related Information
 Tasks
 Set Up Automatic Compensation Grade Step Progression Schedules
 Reference
 Reference: Edit Tenant Setup - HCM
 Reference: Compensation Step and Grade Progression Reports

Set Up Adjustments to Compensation Steps

Prerequisites

 Configure the Set Up Compensation Step Adjustment business processes to meet your
organization's needs.
 Create compensation steps.
 Define reasons for the Request Compensation Changes event using the Maintain Event
Categories and Reasons task.
Context

You can make adjustments to compensation steps associated with a compensation grade.
Workday automatically adjusts the amount for all employees with those steps.

Steps
1. Access the Set Up Compensation Step Adjustment task.
2. Select the compensation grade.

If the grade you want to adjust already has an adjustment in progress, the grade won't be available for
selection.

3. Select the allowed actions for Employees using Default and Employees using Override.

This applies only when employees are assigned to the plan.

Option Description

Adjust to New Applicable to Employees using Default and Employees using Override.
Defaults
Workday sets the assigned value to the new default.

Adjust to Applicable to Employees using Override.

Same Defaults
Workday calculates the difference between the old default and the new default. T
that same difference.

For example, the old default was 500 and the new default is 600, which equals a d
amount was 700. The adjustment to the employee's assigned value would be 700

Do Not Adjust Workday makes no changes to the values assigned to the employee's compensati

1. In the Grade Steps tab, enter the New Amount for the step that replaces the
Old Amount.
2. In the Grade Profile Steps tab, enter the New Amount for the step that
replaces the Old Amount.

Result
If you included a review step in the business process definitions for the employee's
organization, the reviewer completes the same steps and either approves, denies, or
sends back the request to the proposer for further revision.

Once approved, the process:

 Updates the compensation grade steps with the new defaults so that future
grade assignments have the new values.
  Creates compensation events with new values for each impacted employee.

Next Steps
To correct a future dated compensation event, correct or rescind the event and then
reprocess it after the adjustment process is run.

Related Information
Tasks
Create Compensation Grade Steps
Set Up Automatic Compensation Grade Step Progression Schedules

eate a Compensation Grade Hierarchy

Prerequisites

 Create compensation grades.

 Security: Set Up: Compensation General domain in the Core Compensation functional
area.

Context

You can create a single superior-subordinate relationship between grades. Example:

 Level 1 CEO CFO

Level 2 VP Finance VP Human Resources

Level 3 Manager Engineering Manager Recruiting

Level 4 Receptionist Support Analyst

Note: You can also use the Put Compensation Grade Hierarchy web service to create or
edit your grade hierarchy.

Steps

 Access the Maintain Compensation Grade Hierarchy task.

 Create your grade structure.

 Option Description

Order This is the grade level. 1 is the highest level.

Compensation Grades Enter all grades you want associated with the grade lev

Related Information
Tasks
Set Up Compensation Package Analytics
Steps: View Talent Across Organizations
Create Compensation Grade Steps

Set Up Automatic Compensation Grade Step Progression

Schedules

Prerequisites

 Create compensation steps and their progression sequence for your grades and grade
profiles.
 Security: Process: Automatic Step Progression domain in the Core Compensation
functional area.

Context

You can configure automatic compensation grade step progression schedules to ensure that
regulatory or workplace policies for step progression occur on time. As a best practice, Workday
recommends that you schedule the Employee Compensation Step Progression and Employees
Eligible for Next Compensation Step Audit reports to run at the same time as the step
progression process. Doing so identifies the employees participating in parallel compensation
events that may prevent them from progressing to the next step.

Steps
1. Access the Schedule Automatic Step Progression task.
2. Select a Run Frequency to determine when and how frequently to automatically progress your
employees to the next step.
3. On the Schedule tab, enter the applicable scheduling options, which vary depending on the selected
Run Frequency.

This tab doesn't apply to the Run Now option.

Option Description

Daily Recurrence How frequently the process runs in the Recurs Every x Day(s) field. The n
366.

Example: To schedule a recurrence for every day, enter 1; for every other da

You can select Recurs Every Weekday to run the process every day from

Weekly Recurrence How frequently the process runs in the Recurs Every x Week(s) field. The
52.

Monthly Recurrence How frequently the process runs in the Day of the Month, or Week of the

Example: To schedule a monthly recurrence on the first Monday of every mo

Start Time The time of day to start the background process.

End Date
You cannot schedule a process to run more than 5 times after the end of the

Example: a process that runs daily starting on 4/22/2013 must end no later

As a best practice, set the end date no later than 12/31 of the next calendar

1. (Optional) Select 1 or more employees to include or exclude from the step

progression schedule using either an eligibility rule or by selecting employees
individually.

Result
The process scans all employees with compensation steps and evaluates whether the
interval/period and/or the step progression rule (set up with the Maintain
Compensation Steps task) applies. If so, Workday progresses these employees to the
next grade step. Upon completion, the process updates compensation history for these
employees.

 If a progression rule is assigned to the step (either on its own or in addition to

interval/period), the effective date of the compensation change is the date of the
scheduled run. If the step only has interval/period associated with it, the effective
date of the compensation change is the date employees meet the time
requirement.
 If employees are participating in a parallel compensation event, Workday doesn't
progress them to the next step. You can view a list of these employees by
running the Employee Compensation Step Progression or Employees
Eligible for Next Compensation Step Audit reports. The next time you run
the process, it includes those employees. The date of the step change is the start
date of the new step no matter when the process advances the employee.
Example: An employee is eligible to progress from Step 1 to Step 2 on July 1 but is
involved in another compensation process on July 1, the automatic step process ignores
that employee and logs them on the Step Progression Audit report. Each run, the
process attempts to progress that employee to the next step until successful. The date
of step change remains July 1, no matter when the process finally succeeds.

For employees managed by a compensation basis total, Workday processes salary plans
in different ways, depending on whether the plan allows overrides:

 If the salary plan doesn't allow overrides, Workday treats the salary increase
associated with step change as a fixed amount and doesn't alter it.
 If the salary plan does allow overrides, Workday allocates the plan as necessary.

In both cases, Workday performs a partial calculation for any plans that depend on the
salary plan. Workday then adjusts the primary compensation basis.

Related Information
Tasks
Create Compensation Grade Steps

Reference
Reference: Compensation Step and Grade Progression Reports

Request Grade Change

Prerequisites

 Define reasons for the Request Compensation Changes event using the Maintain Event
Categories and Reasons task.
 Create compensation grades.
 Configure the Request Compensation Change business process to meet your
organization's needs.

Context

Request a change in grade for an employee.

Steps
1. Access the Request Grade Change task.
2. Specify the Employee to whom this change applies. This field doesn't appear if you select this task as
a related action off an employee.
3. Select a different Grade, and optionally, select a new Grade Profile.

Result
Changing the grade might change the pay range for the employee; however, it doesn't change
actual compensation.

Next Steps

To change pay, use the Request Compensation Change task.

Related Information
Tasks
Set Up Compensation Package Analytics

Set Up Adjustments to Compensation Grades Assigned to Job

Profiles

Prerequisites

 Configure the Set Up Grade Adjustment for Job Profile business process to meet your
organization's needs.
 Define reasons for Request Compensation Changes event using the Maintain Event
Categories and Reasons task.

Context

You can update the grade assigned to:

 A job profile.
 Employees in that job profile.

Note: Employees in a grade step aren't changed.

Steps
1. Access the Set Up Compensation Grade Job Profile Adjustment task.
2. Select the Job Profile.

If the job profile you want to adjust already has an adjustment in progress, it won't be available for
selection.

Workday calculates and displays:

 Identifies all positions that have the selected job profile

Employees in this Grade  Identifies employees in those positions.
 Identifies employees that have the same grade as that
 Excludes employees in a compensation step.
 Employees not in this Grade  Identifies all positions that have the selected job profile
 Identifies employees in those positions.
 Identifies employees that have a grade that doesn't ma

Employees with an In Progress Workday doesn't process these employees. You must complet
Event these employees.
 Select the Allowed Actions for Employees not in this Grade.
 This applies only when employees are assigned to the plan.


Option Description

Adjust to New Grade Workday sets the assigned value to the new default.

Do Not Adjust Workday makes no changes to the values assigned to the employee's c

 In the Proposed Grade section, enter the Grade you want to associate with the
job profile.

Result
If you included a review step in the business process definitions for the employee's
organization, the reviewer completes the same steps and can either approve, deny, or
send back the request for further revision.

Once approved, the process:

 Updates the job profile with the new grade.

 Assigns the grade to the employees and uses eligibility rules to determine if an
employee qualifies for a grade profile.
 Creates compensation events using the entered Event Name for each impacted
employee.

Example
An employee living in Atlanta has a job profile called Individual Contributor. The grade
associated with the job profile is called Level 1. Level 1 has 3 grade profiles: Boston,
Chicago, and Detroit. The employee doesn't qualify for any of the grade profiles.

The grade associated with the job profile needs to be changed to the grade called IC
Level 1. IC Level 1 has 2 grade profiles: Atlanta and San Francisco.
When the process is run, the employee will have the same job profile with the new
grade called IC Level 1; however, the eligibility rules associated with the grade qualifies
the employee for the grade profile called Atlanta.

Related Information
Tasks

Create Compensation Grades

Create a Compensation Grade Hierarchy

Reference: Compensation Grade and Pay Range Security

You can configure security domains in the Core Compensation functional area:

 For default compensation on open positions and job requisitions.

 To access worker compensation data.
 For workers to access their own compensation data.

Default Compensation on Open Positions and Job Requisitions

Configure security domains for default compensation on open positions and job
requisitions.

Non-Worker Data: Compensation Parent domain of the non-worker compensation data sub

Non-Worker Data: Compensation Basis Pay Range Grants access to the pay range, compa-ratio, penetration

Non-Worker Data: Compensation Grade Grants access to the compensation grade and grade profi

Non-Worker Data: Compensation Pay Range Grants access to the total base pay range, compa-ratio, b

Worker Compensation Data

 Configure security domains to access worker's compensation data.

Worker Data: Compensation by Grants access to the Compensation tab on the worker profile, which displays
Organization assignment.

Worker Data: Compensation Basis Grants access to worker's Compensation Basis.

 Worker Data: Compensation by Grants access to the Compensation tab on the worker profile, which displays
Organization assignment.

Worker Data: Compensation Basis Pay Grants access to the pay range, compa-ratio, penetration, and segment-relate
Range

Worker Data: Compensation Grade Grants access to compensation grade and grade profile-related fields.

Worker Data: Compensation Pay Range Grants access to the total base pay range, compa-ratio, benchmark, and segm

 Worker Access to Their Compensation Data

 Configure security domains for workers to access their own compensation data.
 Note: Workday doesn't deliver these self-service security policies enabled.
Enable the security policies and add security groups to allow employees to see
their own pay ranges.

Self-Service: Compensation Basis Pay Range Grants workers access to the pay range of their prima

Self-Service: Total Base Pay Range Grants workers access to the pay range of their total

 Related Information
 Concepts
 Workday 31 What’s New Post: Compensation Grade and Pay Range Security
 Tasks
 Edit Domain Security Policies
 Create Compensation Grade Steps
 Set Up Automatic Compensation Grade Step Progression Schedules

Reference: Compensation Step and Grade Progression Reports

To view employee information regarding step and grade progression, use these reports:
 Report Name Purpose Generation

Employee Lists employees who have had a compensation To run this report:
Compensation step change within the specified time period.
Step  Access the report t
Progression The report captures: search or the
Compensation men
 Employees advanced to the next step category.
through the automatic step progression  Use the Schedule
progress. Report task to sch
 Employees hired into a compensation step. and run the report
 Employees with a manual compensation same time that you
step change. automatic step
progression proces
Click the various links on a compensation change to
drill into details. For hire compensation events, the
Old Step value remains blank if this is their first
step.

Employee This report lists employees eligible to progress to To run this report:
Compensation the next compensation step in their grade but did
Step not. Some employees don't progress due to a  Access the report t
Progression parallel compensation process that ran the same search or the
Audit time as the automatic step progression process. Compensation men
category.
The automatic step progression process can  Use the Schedule
advance employees to the next step if there is no Report task to sch
parallel compensation process in progress. and run the report
same time that you
automatic step
progression proces

Employees Lists relevant details about employees who have To run the report:
Eligible for reached the last compensation step in their current
Next Grade grade and are eligible to progress into the first step  Access the report t
of the next grade. search or the
Compensation men
category.

Use the current or

date.

 Use the Schedule

Report task to sch
and run the report
same time that you
 Report Name Purpose Generation

automatic step
progression proces

Employees This report lists, as of a specific date, relevant Access the report through
Eligible for details about employees who have satisfied the or the Compensation men
Next time requirement for their current compensation category. Use the current
Compensation step and are eligible to progress to the next step in future date.
Step their grade.

FAQ: Compensation Defaulting

What is the difference between default compensation and compensation defaulting?

Why would I want to use default compensation on a position?

Why doesn't Workday default compensation on the Request Compensation Change task?

What effect does a compensation package have on compensation defaulting?

Why do rehired employees have current assignments?

How does the Retain Basis Total option on the compensation basis affect the proposed total?

What is the difference between default compensation and compensation defaulting?

Default compensation refers to the compensation attributes configured on a position.

Workday automatically populates fields when filling a position or a job from default
compensation, if it's configured on the position. Compensation defaulting simply refers to
how Workday populates compensation values.

Example: You've configured compensation for the Recruiter position but not for the
Event Coordinator position. There's no offer or job requisition. When Glen hires Andrea
for the Recruiter position using Hire, Workday automatically populates compensation
from the position. When Glen hires Heather for the Event Coordinator position, Workday
uses eligibility rules.

This table lists stand-alone business processes and the sources from which Workday
automatically populates compensation values. For some business processes, such as Hire
and Change Job, Workday searches for compensation values in multiple sources
sequentially and stops when it finds values.
 Task or Business Source of Compens
Process

Create Position and Edit Eligibility rules.

Position
The Change Default Compensation subprocess of the Create Position business proces
eligibility rules. Workday assigns any changes made or additional compensation plans

Create Job Requisition 1. Position.

2. Eligibility rules.

Edit Job Requisition Eligibility rules.

Offer and Employment 1. Job Requisition.

Agreement 2. Eligibility rules.

If offer or employment agreement details, such as location, change during a renegotiat

exists on the job requisition.

The Offer and Employment Agreement business processes don't use default compensat

Hire 1. Offer.
2. Job requisition.
3. Position.
4. Eligibility rules.

Change Job 1. Offer.

2. Job requisition.
3. Position, except when you're moving the worker to another position. Workday
4. Eligibility rules.

Request Compensation No defaulting.

Change

Request Requisition
Compensation Change No defaulting.
Why would I want to use default compensation on a position?

So that every employee who hires into that position gets the same compensation
values.

Default Compensation enables the establishment of compensation guidelines,

plans, and plan amounts on a position. Examples:

 Position budgeting.
 Tracking default compensation as budgeted or approved compensation.
  Sending target or approved compensation to an external Applicant
Tracking System.
 To aid in giving concise compensation guidance to those proposing
compensation.

Why doesn't Workday default compensation in the Request Compensation

Change task?

The Request Compensation Change task is for:

 Proposing a change to existing compensation for an employee, not to

initially determine it.
 A single-purpose compensation change.

Workday doesn't run eligibility rules at initiation to populate plans in the

Proposed column of the transaction. You can view the eligible plans when
proposing compensation using the By Compensation Package and Rule or By
Compensation Rule options.

What effect does a compensation package have on compensation defaulting?

Compensation packages group together grades, grade profiles, and

compensation plans. If an employee is affected by an eligibility rule associated
with a compensation package, the grades, grade profiles, and compensation
plans associated with the compensation package determine compensation
defaulting.

Why do rehired employees have current assignments?

To determine compensation for a rehired employee, Workday:

1. Reads compensation assignments in effect before the employee

terminated and uses that for the initial compensation values on rehire.
2. Reads compensation values from the Offer business process in Workday
Recruiting, if they exist. If not, Workday looks for default compensation if
configured on the position. Finally, if the position doesn't have default
compensation, Workday uses eligibility rules.

How does the Retain Basis Total option on the compensation basis affect the
proposed total?

If you selected Retain Basis Total on the compensation basis, Workday

populates the existing compensation basis total during the Propose
Compensation step of the Change Job process. The primary compensation basis
doesn't come from the job requisition. Workday then rebalances the plan
assignments but keeps the compensation basis total fixed. If Retain Basis Total
isn't selected, Workday recalculates the compensation basis total based on the
changed plan assignments.

Related Information
Reference
Reference: Default Job Requisition Data

Manage Compensation
Propose Compensation for Employees or Positions

Prerequisites
 Security:
o You must have access to the domain for each plan type in both the Core
Compensation and the Advanced Compensation functional areas.

Some plan definitions restrict the ability to override values. If you are
using a compensation matrix, Workday is able to derive the plan target for
the employee only after the employee's performance review is complete.

Your security policies define the sections that display and the changes you
can make when proposing compensation. You can set up compensation
plans to not allow individual overrides.

o For employees managed by a compensation basis total, you must have

access to the Compensation Change: Compensation Basis Details domain
in the Core Compensation functional area.

To review security, run the View Business Process Template and Template-
Driven Business Process Security reports.

 Define reasons for the Request Compensation Change event using the Maintain
Event Categories and Reasons task.

Context
Propose compensation for an employee or a candidate using these tasks or business
processes:

 Offer
 Employment Agreement
 Hire
 Request Compensation Change
 Change Job
 Add Additional Job
 Start International Assignment

You can alternatively update compensation for groups of employees using Workday's
Enterprise Interface Builder (EIB):
 Employee Group

Existing employees Request Compensation Change

New Hires High Volume Event - Hire Employee

You can also assign default compensation to an approved job or position. Every
employee that hires into that position gets the same default compensation values.

You can't initiate a task to propose compensation for yourself.

teps

 Access the relevant task or business process:

Choose...

Change Job business process. Propose new compensation when an employee changes

Create Position business process. Assign default compensation to a position.

Propose Compensation button in your Inbox. Propose compensation for a new hire.

Request Compensation Change task. Change an existing employee's compensation.

Start International Assignment business process. Propose new compensation when an employee starts an

 You can display the current compensation for internal candidates:

o Access the Maintain Localization Settings task.
o Select Internal Candidate Compensation for the Area.
o Configure 1 or more locations in Allow for Countries. Workday displays
the internal candidate's current compensation only if their current job's
primary location is included in Allow for Countries.
 As you complete this task, consider:

1.
 Option Description

Employee Visibility Date Hides the employee's pay-related compensation events in Workday until after the sp

Displays only if the Enable Employee Visibility Date is selected in the Compensa

Expected End Date On salary, hourly, or allowance plans, the Expected End Date is an estimate. Use t
Dates task to actually remove plans from employees.

Actual End Date If displayed, the Actual End Date determines when Workday automatically remove

Fixed for Manage by Displays only when:

Basis Total
o The employee is managed by basis total.
o The primary compensation basis includes the compensation plan.
o The compensation plan allows overrides.
o The business process is Change Job, Hire, or Request Compensation Chang
o The compensation plan is:
 Allowance Amount Plan.
 Allowance Unit Plan.
 Bonus Amount Plan.
 Commission Plan.
 Stock Amount Plan.

If selected, Workday treats the assigned amount as fixed when performing a top-dow

Guidelines
If you change the Grade Step, the Progression Start Date defaults to the effective
date.

Result
After the request is approved, the business process creates a compensation event for
the employee that can be tracked in Worker History.

If you assigned default compensation to a position, Workday uses the compensation

values from the position instead of eligibility rules when you perform staffing
transactions that involve position events.
Note: Workday doesn't rerun eligibility rules if you change plan assignments at the
same time you're proposing compensation. Example: If you change a bonus plan,
Workday doesn't run eligibility rules to update other compensation values during the
same transaction.

Next Steps
 Run the Schedule Remove Compensation Plans with Expected End Dates
task to remove plan assignments. This task ignores plan assignments with an
Actual End Date.
  To review period salary plans, use the Period Salary Plans Manage By
Compensation Basis Health report.

Related Information
Tasks
Remove Compensation Plans with Expected End Dates
Steps: Set Up Offers
Steps: Set Up Employment Agreements

Reference
FAQ: Propose Compensation

Roll Out Compensation Plans to Multiple Employees

Prerequisites

 Create the compensation framework.

 Create compensation plans.
 Security: Process: Compensation Plan Employee Management domain in the Core
Compensation functional area.

Context

Assign compensation plans to a group of target employees. This process bypasses reviews and
approvals, enabling you to assign plans to employees immediately. You can roll out:

 Allowance plans
 Bonus plans
 Commission plans
 Merit plans
 Period Salary Plans
 Stock plans

Steps
1. Access the Rollout Compensation Plans to Employees task.
2. Select the Effective Date on which you want this process to create the compensation change requests
to assign the target employees to the specified plans.
3. Select the Compensation Plans that you want to assign to the target population of employees.
4. (Optional) Enter an Expected End Date and/or an Actual End Date .

Note: The Actual End Date field displays only if the Enable Actual End Date field is selected on
the Edit Tenant Setup - HCM task.

The Expected End Date is your estimate for when the employee's assignment to a salary, hourly, or
allowance plan will end. To actually remove plans from employees based on the Expected End Date,
use the Schedule Remove Compensation Plans with Expected End Dates task.
 If you enter an Actual End Date, Workday automatically removes the plan assignment from the
employee at 11:59:59 PM on that date.

The Schedule Remove Compensation Plans with Expected End Dates task ignores compensation
plan assignments with an Actual End Date. Workday only removes employees from compensation
plans on this schedule if there is no Actual End Date configured for the plan assignment.

5. Select employees to assign to the specified plans, either By Compensation Eligibility Rule or By
Selected Employees.

If you use the By Selected Employees option, Workday lists the first 50 employees either included in
the process or not included because they are in a pending compensation event. Workday does not list
any individual employees selected using By Compensation Eligibility Rule.

Result

As of the effective date specified, this process creates a compensation event for each employee
included in the rollout and adds a row to the employee's compensation history.

To view complete lists of the employees that the plan rollout process handled, use the View
Compensation Plan Rollout Process report and select the name of the process event.

Related Information
Tasks
Create Allowance Plans
Create Commission Plans
Create Hourly Plans
Create One-Time Payment Plans
Set Up Segmented Security by Compensation Plans
Steps: Set Up Bonus Plans
Steps: Set Up Merit Plans
Steps: Set Up Salary Plans
Steps: Set Up Stock Plans

Reference
Reference: Compensation Plan Comparisons

Remove Compensation Plans from Multiple Employees

Prerequisites

 Create the compensation framework.

 Security: Process: Compensation Plan Employee Management domain in the Core
Compensation functional area.

Context
Remove allowance, bonus, commission, hourly, merit, and stock plan assignments from a target
population of employees. This process bypasses reviews and approvals.

Steps
1. Access the Remove Compensation Plans from Employees task.
2. Select the Effective Date on which you want this process to create the compensation change requests
to remove the target employees from the specified plans.
3. Select the Compensation Plans (both active and inactive) that you want to remove from the target
population of employees.
4. Select Employees to remove from the specified plans, either By Compensation Eligibility Rule or
By Selected Employees.

If you use By Selected Employees, Workday lists the first 50 employees either included in the
process or not included because they are in a pending compensation event. Workday does not list any
individual employees selected using By Compensation Eligibility Rule.

Related Information
Tasks
Add or Remove Employees to or from Compensation Review Processes

Remove Compensation Plans with Expected End Dates

Prerequisites

 Create allowance, hourly, and salary plans.

 Create event using the Maintain Event Categories and Reasons task.
 Security: Process: Compensation Plan Events domain in the Core Compensation
functional area.

Context

Remove salary, hourly, or allowance plan assignments from a target population of employees if
the assignments have an Expected End Date. This is an administrative process and doesn't
include reviews or approvals.

Steps
1. Access the Schedule Remove Compensation Plans with Expected End Dates task.
2. In the Process Details section, complete the following:
Option Description

Effective Date Determines the date on which Workday removes the plan assignments from the
Options

Effective as of Available if you selected Specific End Date in the Effective Date Options field
Date
This is date that the plan assignments will be removed from the employees.

Expected End Available when Run Frequency equals Run Now.

Date
Employees with an expected end date for the selected compensation plans that
the target population.

Start Date Available when Run Frequency equals Run Now.

Employees with an expected end date for the selected compensation plan that
included in the target population.

End Date Available when Run Frequency equals Run Now.

Employees with an expected end date for the selected compensation plan that
be included in the target population.

1. In the Plans section, select the compensation plans that you want to remove
from the target population of employees.

You can remove active or inactive plans.

2. Click the Schedule tab and complete the Recurrence Criteria and Range of
Recurrence information.

Available when the Run Frequency does not equal Run Now.

Result
This process ignores compensation plan assignments with an Actual End Date.
Workday only removes employees from compensation plans if there is no Actual End
Date configured.

Related Information
Tasks
Add or Remove Employees to or from Compensation Review Processes
Roll Out Compensation Plans to Multiple Employees
Propose Compensation for Employees or Positions
Remove Compensation Plans from Multiple Employees
Set Up Segmented Security by Compensation Plans

Prerequisites

 Analyze your organization's needs and decide whether segmented security for
compensation is appropriate. Evaluate your current organizational structure and
thoroughly understand segmented security requirements.
 Configure organizational hierarchies, security groups, and organizational roles.

Note: The use of segmented security groups won't apply to every business; it involves
a number of complex steps and impacts your overall compensation practice. Even if
you currently use location hierarchies for other purposes, your current hierarchies
might not be adequate for restricting access to compensation components. Also,
intersection security isn't available for Compensation.

 Create location hierarchy organizations that parallel the segments you need.
 Security:
o Set Up: Tenant Setup - HCM domain in the System functional area.
o Set Up: Assignable Roles domain in the Organization and Roles functional area.
o Reports: Organization domain in the Organization and Roles functional area.
o Security Configuration domain in the System functional area.
o Compensation Segmented Setup domain in the System functional area.

Context

Segmented security groups divide access to Compensation setup data (such as Compensation
Plans) among multiple Compensation Partners.

Example: A business with sites in Canada, the U.S., and Mexico might require a separate
Compensation Partner for each country with appropriate access to the setup data.

Note: Compensation Administrators need access to all compensation segments you create, no
matter how you decide to segment your organization's compensation groups.

Steps
1. Enable the segmented security group feature for compensation.
a. Access the Edit Tenant Setup - HCM task.
b. In the Compensation section, select the Enable Compensation Setup Segment Security
check box.
2. Enable the Compensation Partner role for the Location Hierarchy organization type.
a. Access the Maintain Assignable Roles task.
b. In the Enable for Organization Types column, add Location Hierarchy to any organization
types already enabled.
3. In the applicable location hierarchy organization, assign the Compensation Partner role to the desired
worker.
a. Access the View Organization task.
 b. Open the applicable location hierarchy organization.
c. From the related actions menu, select Roles > Assign Roles.
d. In the Assign Roles section, select Compensation Partner as the Role, and select the desired
Worker to whom the Role should be assigned.
4. Create an organization membership security group that includes the applicable location hierarchy.
a. Access the Create Security Group task.
b. For Type of Group, select Organization Membership Security Group.
c. In the list of Organizations, add the desired location hierarchy to the security group.
d. Specify whether the new organization membership security group Applies to Current
Organization Only or Applies to Current Organization And All Subordinates.
5. Create an intersection security group that includes the applicable organization membership security
group and the Compensation Partner security group.
a. Access the Create Security Group task.
b. For Type of Group, select Intersection Security Group.
c. In the list of Security Groups, add the desired organization membership security group and
the Compensation Partner security group.
6. Create a security segment for the desired compensation component, such as country.
a. Access the Create Compensation Setup Security Segment task.
b. Select the Pay Component (or set of components) to contain within the segment.
7. Create a segment-based security group that joins the applicable intersection security group with the
applicable security segment. This is a critical step that ties together the preceding steps.
a. Access the Create Security Group task.
b. For Type of Group, select Segment-Based Security Group.
c. In the list of Security Groups, add the applicable intersection security group.
d. In the list of Access Rights, add the applicable security segments.
8. Repeat steps 3 through 7 for each secured compensation segment you want to create.
9. Create or Edit Segment-Based Security Groups.

Create a segment-based security group for the Compensation Administrator that joins the
Compensation Administrator with all the security segments created.

10. To use any new segment-based security group that you've created, update and activate the domain
security policy and business process security policy for the Compensation functional area.
a. Access the Functional Areas report.
b. From the related actions menu for Core Compensation and Advanced Compensation, select
Functional Area > View Business Process Policies (or View Domain Policies).
c. Click Edit Permissions.
d. Add the segment-based security group to the applicable domain security policy/business
process security policy.
e. Delete the Compensation Partner security group from the applicable domain security
policy/business process security policy.
f. Access the Activate Pending Security Policy Changes task to confirm changes.

Next Steps

You can use the All Compensation Setup Security Segments report to review which
intersection groups constrain the segment-based security groups for a particular compensation
segment or component.

Related Information
Concepts
Concept: Security Groups

Tasks
Create or Edit Intersection Security Groups
Restrict Viewing of Merit, Bonus, and Stock Plan Assignments

Reference
Reference: Edit Tenant Setup - HCM
Reference: Compensation Plan Comparisons

Restrict Viewing of Merit, Bonus, and Stock Plan Assignments

Prerequisites
Security:

 Compensation Segmented Setup domain in the System functional area.

 Security Configuration domain in the System functional area.

Context
You can create security segments that restrict the access to specific merit, bonus, or
stock plan assignments to specific security groups.

Steps
1. Create the segments that define the funded plan types and plans to which you
want to grant access.
a. Access the Create Compensation Plan Assignment Security
Segment task.

b. Select one or more Funded Plan Types.

The segment includes all individual plans associated with a plan type.

c. In the Funded Plan field, select one or more individual compensation

plans.

This field can't be combined with Funded Plan Types.

2. Create segment-based security groups that you want to associate with the plan
assignment segments.
a. Access the Create Security Group task.
b. For Type of Tenanted Security Group, select Segment-Based Security
Group.
c. Select the Security Groups you want to have access to the segment.
d. In the Access Rights field, select the segment you created.
3. Activate the Worker Data: Funded Plan Assignments and Self Service: Funded
Plan Assignments domains.
a. Access the View Domain task.
 b. Select the Worker Data: Funded Plan Assignments Domain.
c. From the related actions menu of Domain Security Policy, select
Domain Security Policy > Enable.
d. Select the Confirm check box.
e. Repeat steps A - D for the Self Service: Funded Plan Assignments domain.
f. Access the Activate Pending Security Policy Changestask and confirm
changes.
4. Add the segment-based security group to the Worker Data: Funded Plan
Assignments domain.
a. Access the View Domain task.
b. Select the Worker Data: Funded Plan Assignments Domain.
c. From the related actions menu of Domain Security Policy select
Domain Security Policy > Edit Permissions.
d. Add the segment-based security group to the applicable domain or
business process security policies.
e. Delete any role that displays in the list of security groups that is also part
of the segment-based security group.
f. Access the Activate Pending Security Policy Changes task and
confirm changes.

Result
You can only see compensation plan assignments as defined by the security segments
when you view:

 Event information
 Compensation history
 Worker history
 Worker profile
 View Plan Assignments
 View Plan Audits

Set Up Adjustments to Unit Salary, Hourly, Allowance, and

Commission Plans

Prerequisites
 Configure these business processes to meet your organization's needs:
o Set Up Unit Salary Plan Adjustment
o Set Up Hourly Plan Adjustment
o Set Up Allowance Plan Adjustment
o Set Up Unit Allowance Plan Adjustment
o Set Up Commission Plan Adjustment
 Define reasons for Request Compensation Change event using the Maintain
Event Categories and Reasons task.

Context
You can make adjustments to a unit-based salary, hourly, allowance, and commission
plans. Workday then adjusts the compensation amount for all employees in the plan.

Steps
1. Access the appropriate task:
o Set Up Unit Salary Plan Adjustment
o Set Up Hourly Plan Adjustment
o Set Up Allowance Plan Adjustment
o Set Up Unit Allowance Plan Adjustment
o Set Up Commission Plan Adjustment
2. Select the compensation plan.

If the plan you want to adjust already has an adjustment in progress, you can't
select the plan.

3. Select the Allowed Actions for Employees using Default and Employees
using Override for employees assigned to the plan.
4.

Option Description

Adjust to New Defaults Applicable to Employees using Default and Employees using Override.

Workday sets the assigned value to the new default.

Adjust to Same Applicable to Employees using Override.

Amounts
Workday calculates the difference between the old default and the new default, and a

Example: Set the new default to 600 from 500. If the override amount is 700, Workda
100.

5. Enter the new values that replace the old ones.

Result
If you included a review step in the business process, the reviewer approves the
request, denies it, or sends it back to the proposer for further revision.

Once approved, the process:

 Updates the plan definition with the new defaults so that future plan assignments
have the new values.
 Assigns the plan to the employees and uses eligibility rules to determine if an
employee qualifies for a plan profile.
 Creates compensation events with the new values for each impacted employee.
Next Steps
 Access the Compensation Plan End Date Audit report to detect employees
with a future dated compensation event that conflicts with the event generated
by this process.

To correct a future dated compensation event, correct or rescind the event and
then reprocess it after the adjustment process.

Related Information
Tasks
Create Allowance Plans
Create Hourly Plans
Edit Business Processes
Create Unit Salary Plans
Create Commission Plans

FAQ: Propose Compensation

How does the Employee Visibility Date work?

Workday displays the Employee Visibility Date only if the Enable Employee
Visibility Date check box is selected in the Edit Tenant Setup - HCM task.

Employees can't see their pay-related compensation changes in Workday until

after the specified date.

Workday hides only pay-related events, such as a change in job title or a

promotion. Review security and ensure that the Employee as Self security group
isn't included in the:

 Propose Compensation step of business processes.

 Propose Compensation Change business process.
 Staffing and Job profile groups from the worker profile.
 View All or View Completed sections of the Request Compensation
Change and Request One-Time Payment tasks.

How do the Expected End Date and Actual End Date fields work?

For salary, hourly, or allowance plans, the Expected End Date is an estimate.
Use the Schedule Remove Compensation Plans with Expected End Dates
task to actually remove plans from employees.

For plan assignments with an Actual End Date selected, Workday automatically
removes the plan assignment from the employee at 11:59:59 PM on that date.

Note: The Schedule Remove Compensation Plans with Expected End

Dates task ignores plan assignments with an Actual End Date.
 Workday displays the Actual End Date field only if the Enable Actual End
Date field was selected in the Compensation section of the Edit Tenant
Setup - HCM task.

How does proposing compensation affect the compensation basis total?

If an employee is managed by a compensation basis total and you make changes

to the individual plans that make up the compensation basis, Workday
recalculates the proportional plans based on the modified plan. However,
Workday doesn't recalculate plans that are a percentage of total cash when
individual plans are changed.

On the Hire and Change Job business processes, managers can override the
amount for employees managed by a compensation basis. Workday then
performs a partial calculation and recalculates only those plans that depend on
the change. In this case, the period salary plan functions as a percentage-based
plan. If you want to have the period salary plan function as a percentage of
salary only, modify the compensation basis to contain salary only. Run the
Period Salary Plans Manage By Compensation Basis Health report to
verify your configuration.

If you select the Fixed for Manage by Basis Total check box while proposing
compensation, Workday treats the assigned amount as fixed when performing a
top-down calculation on the primary compensation basis. This check box displays
only when:

 The compensation plan is included in the primary compensation basis.

 The compensation plan is amount- or unit-based.
 The compensation plan allows overrides.

Reference: Compensation Plan Comparisons

This chart describes the differences between the various types of Workday
compensation plans to help you determine which plan type to use.

Plan Type When do I use this plan How do I assign How do the empl
type? employees to the plan?

 As part of the Hire Workday automatically

Salary Use to associate eligible transaction. compensation to payrol
salaried employees with the  As part of another period payment.
appropriate base salary staffing transaction
compensation elements. (promote, demote,
transfer).
 As an ad hoc
transaction using
the Request
Compensation
Change task.
Plan Type When do I use this plan How do I assign How do the empl
type? employees to the plan?

Hourly Use to associate eligible  As part of the Hire Workday sends the com
hourly employees with the transaction. actual hours to payroll
hourly.  As an ad hoc period.
transaction using
the Request
Compensation
Change task.
 As part of another
staffing transaction
(promote, demote,
transfer).

*Merit Use to group employees  As part of the Hire You can create a specifi
(using eligibility rules) who transaction. generates a request for
are going to get a change to  As part of another plan to get a base pay c
their base pay, and optionally, staffing transaction the base pay amount a
a promotion or additional (promote, demote, payroll.
adjustments. You can also transfer).
add bonus and stock  Through the Roll
components to merit plans. Out
Compensation
If you want to give 1 person a Plans to
raise, use the Request Employees task.
Compensation Change  As an ad hoc
task. transaction using
the Request
Compensation
Change task.

*Bonus Use to group people together  As part of the Hire You can set up and laun
who are all going to get a transaction. plan using the bonus pr
bonus payment at the same  As part of another the merit process. The
time. staffing transaction request for each person
(promote, demote, to get a portion of the b
transfer). manager or administrat
 Through the Roll the amount for each pe
Out pay the target amount
Compensation predefined installments
Plans to also load these amount
Employees task. approved bonuses auto
 As an ad hoc payroll.
transaction using
the Request
Compensation
Plan Type When do I use this plan How do I assign How do the empl
type? employees to the plan?

Change task.

*One-Time Use to give an employee an Workday doesn't assign Request and complete
ad hoc payment for the plan type to the transaction, which auto
something such as an employee but makes it payroll for payment.
incentive bonus. available for assignment.

*Period Use to give an employee  As part of the Hire Workday sends the amo
Salary Plan extra months, weeks, or days transaction. period salary plan to pa
of pay.  As part of another with regular pay.
staffing transaction
(promote, demote,
transfer).
 As an ad hoc
transaction using
the Request
Compensation
Change task.

*Commissi Use to store the target  As part of the Hire Workday doesn't pay ou
on amount for commission. transaction.
 As part of another You can integrate with
staffing transaction incentive management
(promote, demote, commissions appropria
transfer).
 Through the Roll
Out
Compensation
Plans to
Employees task.
 As an ad hoc
transaction using
the Request
Compensation
Change task.

Allowances Use for compensation paid on  As part of the Hire The amount specified in
a regular basis, such as a transaction. automatically flows to p
monthly cell phone allowance.  As part of another with the employee’s reg
staffing transaction
(promote, demote,
transfer).
 Through the Roll
Out
 Plan Type When do I use this plan How do I assign How do the empl
type? employees to the plan?

Compensation
Plans to
Employees task.
 As an ad hoc
transaction using
the Request
Compensation
Change task.

*Stock Use to group people together  As part of the Hire Workday doesn't pay ou
who are all going to get a transaction. can integrate with a thi
stock grant at the same time.  As part of another administration system t
staffing transaction other stock administrat
(promote, demote,
transfer).
 Through the Roll
Out
Compensation
Plans to
Employees task.
 As an ad hoc
transaction using
the Request
Compensation
Change task.

*Future Use alone or consider targets Administrators can laun

Payment from other bonus or one-time Administrators can assign plan, which generates a
Plan payment plans to pay an an employee to the plan person enrolled in the p
employee a target amount. as an ad hoc transaction of the bonus pool. The a
Allows administrator to true using the Assign Future determines the amount
up any remaining balance in a Payment Plans task. approved bonuses auto
final payment at the end of payroll.
the period.
These compensation plans are discretionary. Employees aren't paid from discretionary
compensation plans in every pay period.

To view:

 All compensation-related reports, run Workday Standard Reports. Select the

Compensation and Set Up Compensation categories.
 A complete list of your compensation plans, access the Compensation Plans
report.
  Employees assigned to various compensation plans, access the View
Compensation Plan Rollout Process report or the Compensation
Component Assignments report.
 All the employees in any compensation plan, run the Compensation Plan
Assignments report.
 Employees assigned a specific plan, except future payment plans or one-time
payment plans, select [plan type] > [plan type] Assignments from the
related actions menu of the plan. Example: Merit Plan > Merit Plan
Assignments.

Salary
Steps: Set Up Salary Plans

Prerequisites
Set up the compensation framework.

Steps
1. Create Salary Plans.
2. Create Unit Salary Plans.
3. Create Period Salary Plans.

Create a plan that enables you to assign extra months, weeks, or days of pay to
employees.

Next Steps
You can:

 Assign the salary plan to a compensation package.

 Assign the salary plan to new hires.
 Assign the salary plan to promoted, demoted, and transferred employees.

Related Information
Tasks
Roll Out Compensation Plans to Multiple Employees

Create Salary Plans

Prerequisites
 Create compensation elements.
 Security: Set Up: Base and Plan domain in the Core Compensation functional
area.
Context
Create a salary plan that you can then assign to eligible employees.

Steps
1. Access the Create Salary Plan task.
2. In the Details section, select the Inactive check box if you don't want the plan
available for use with new processes. Processes already in progress using this
plan complete as normal.
3. In the Salary Defaults section, consider:

Option Description

Apply FTE% Displays only for amount-based and unit-based plans.

Select this check box to prorate compensation for employees assigned to this plan based on t

You can optionally select the Use 100% FTE for Pay Range Comparisons check box in th
selected, Workday divides the employee salary by the FTE % before comparing it to the sala

o Compa-Ratio
o Position in Range
o Pay Range Segment

Compensation Compensation elements store the earnings associated with compensation.

Element
If you select a compensation element designated as base pay, Workday includes the compen

1. In the Plan Eligibility section, select 1 or more eligibility rules.

Eligibility rules determine which employees are eligible for this plan. If you select
multiple eligibility rules, Workday evaluates each rule independently to
determine employee eligibility for the plan. Employees are eligible if they meet
the qualifications of any 1 rule. You can only use individual rules once in the plan
and profiles.

2. In the Process Eligibility section, select the Exclude from Merit check box if
you don't want this plan to be available when you initiate a merit process.

Next Steps
You can:

 Access the Edit Salary Plan task to update the plan.

 Access the Salary Plan report to see the detailed information for a specific plan.
 You can only update default values for plans that aren't assigned to employees.
The Compensation Element field, however, is an exception; it can be updated
regardless if it's assigned or unassigned. Once you assign a plan, defaults
become unavailable to edit. Instead, make a plan adjustment through the Set Up
Unit Salary Plan Adjustment task.

 You can hide the compensation plan type from specified groups of workers using
the Worker Data: Compensation Plan Type domain in the Core Compensation
functional area.

Example: Use this security domain to hide the compensation plan type on the
Compensation Plan Assignments report for workers in Germany. Workers can
still see the plan name.

Related Information
Concepts
Concept: Proration

Tasks
Steps: Set Up Salary Plans
Create Time Proration Rules for Merit and Bonus Processes
Define Proration Method

Examples
Example: Time-Based Proration for Merit and Bonus Awards

Create Unit Salary Plans

Prerequisites

 Create compensation elements.

 Security: Set Up: Base and Plan domain in the Core Compensation functional area.

Context

Create a unit salary plan that you can then assign to eligible employees.

Steps
1. Access the Create Unit Salary Plan task.
2. In the Salary Defaults section, consider:

Option Description

Compensation Compensation elements store the earnings associated with compensation.

Element
Option Description

If you select a compensation element designated as base pay, Workday include

base pay calculation.

Unit Select the unit for measuring the work performed.

Per Unit Amount Enter the amount paid for each unit of work performed.

Default Units
Enter the number of units an employee is expected to work for the specified tim

Units multiplied by per unit amount determine an employee's pay. This is only u

If you select a compensation element designated as base pay, then Workday in

employee's base pay calculation.

Frequency Select the time frame in which an employee gets paid for the number of units w

Workday calculates pay for employees by using the employee's scheduled wee
as defined in the frequency definition.

To ensure the proper calculation method, use the Maintain Frequencies task
selected frequency.

No Override Select this check box to prevent these values from being overridden.

1. In the Plan Eligibility section, select 1 or more rules.

Eligibility rules determine which employees are eligible for this salary plan. If you
select multiple eligibility rules, Workday evaluates each rule independently to
determine employee eligibility for the plan. Employees are eligible if they meet
the qualifications of any one rule.

Next Steps
Now that you have completed your plan definition, you can:

 Put the plan into one or more compensation packages.

 Assign the plan and other compensation components to the defaulting rule.
 You can hide the compensation plan type from specified groups of workers using
the Worker Data: Compensation Plan Type domain in the Core Compensation
functional area.

Example: Use this security domain to hide the compensation plan type on the
Compensation Plan Assignments report for workers in Germany. Workers can
still see the plan name.
Related Information
Tasks
Steps: Set Up Salary Plans
Set Up Adjustments to Unit Salary, Hourly, Allowance, and Commission Plans

Create Period Salary Plans

Prerequisites

 Create compensation elements.

 Create compensation basis.
 Security: Set Up: Base and Plan domain in the Core Compensation functional area.

Context

Create a plan that enables you to assign extra months, weeks, or days of pay to employees.

Steps
1. Access the Create Period Salary Plan task.
2. In the Details section, select Inactive to indicate the plan isn't available for use.

Processes already using plans marked Inactive complete as normal.

3. In the Period Salary Defaults section, consider:

1.

Option Description

Compensation Compensation elements store the earnings associated with compensation.

Element
If you select a compensation element designated as base pay, Workday includes the pla

Compensation Period Multiplies the Compensation Period. (Up to 2 decimal places allowed.)
Multiplier
Example: If the Compensation Period Multiplier is 15.50 and the Compensation Per

Compensation Basis Available if you select the Percent Based Plan option.

Select the compensation basis Workday uses to determine the target amount (if the wor
worker is managed by a compensation basis, Workday doesn't exclude this plan when c

If you select a compensation basis that includes this plan, Workday excludes this plan w

If you select a subtractive compensation basis, Workday subtracts the subtractive basis
 Option Description

calculating the percentage-based target amount.

If the plan is part of a compensation basis that has the Manage Basis Total check box s
case, the period salary plan works like any other proportional plan. Workday allows ind
changes.

2. In the Plan Eligibility section, select 1 or more rules.

Eligibility rules determine which employees are eligible for this period salary
plan. If you select multiple eligibility rules, Workday evaluates each rule
independently to determine employee eligibility for the stock plan. Employees
are eligible if they meet the qualifications of any one rule.

3. (Optional) Complete the Period Salary Plan Profiles section.

This enables you to have different payout amounts for different groups of
employees.

Example: You can set up 1 profile where the target for an individual employee is
2 months total base pay and another with 3 months total base pay.

Next Steps
 Use the Period Salary Plan report to review the plan.
 You can hide the compensation plan type from specified groups of workers using
the Worker Data: Compensation Plan Type domain in the Core Compensation
functional area.

Example: Use this security domain to hide the compensation plan type on the
Compensation Plan Assignments report for workers in Germany. Workers can
still see the plan name.

Related Information
Tasks
Steps: Set Up Salary Plans
Roll Out Compensation Plans to Multiple Employees

Hourly
Create Hourly Plans

Prerequisites
  Set up the compensation framework.
 Security: Set Up: Base and Plan domain in the Core Compensation functional area.

Context

Create or update an hourly plan that you can then assign to eligible employees.

Steps
1. Access the Create Hourly Plan task.
2. In the Details section, consider:
3.

Option Description

Inactive Select this check box if the plan is not available for use. Processes already using this plan compl

Minimum Select this check box to indicate that the defaults define the minimum wage in the regulatory reg
Wage
When selected, managers can propose only hourly rates higher than the default amount for empl
and frequency.

4. In the Hourly Defaults section, consider:

Option Description

Compensation Compensation elements store the earnings associated with compensation.

Element
If you select a compensation element designated as base pay, Workday includes the com

Frequency Given that this is an hourly plan, always select Hourly so that the employee gets paid by

Workday calculates pay for employees by using the employee's scheduled weekly hours
definition.

1. In the Plan Eligibility section, select 1 or more rules.

Employees are eligible if they meet the qualifications of any 1 rule. If you select
multiple eligibility rules, Workday evaluates each rule independently to
determine employee eligibility for the plan.

2. In the Process Eligibility section, select Exclude from Merit if you don't want
this plan available when you initiate the merit process.
Next Steps
You can hide the compensation plan type from specified groups of workers using the
Worker Data: Compensation Plan Type domain in the Core Compensation functional
area. Example: Use this security domain to hide the compensation plan type on the
Compensation Plan Assignments report for workers in Germany. Workers can still
see the plan name.

Related Information
Tasks
Steps: Set Up the Compensation Framework
Roll Out Compensation Plans to Multiple Employees
Set Up Adjustments to Unit Salary, Hourly, Allowance, and Commission Plans

FAQ: How do I annualize hourly plans?

As the equivalent of prorating salary plans, you annualize hourly plans using workers' scheduled
weekly hours. In hourly plans (with an Hourly frequency), Workday calculates workers' pay
using:

 The worker's scheduled weekly hours, and

 An annualization factor.

Set the calculation method using the Maintain Frequencies task.

Allowance
Steps: Manage Reimbursable Accounts

Context
Allowance plans can be linked to expense items and paid after an expense report is
approved. This diagram illustrates the process flow for managing reimbursable
allowance plans.

Steps
1. Create an expense item for reimbursement accounts.

When creating the expense item, select Based on Allowance Plan. See Steps:
Create Expense Items.

2. Create Allowance Plans.

 When creating an allowance plan, select Reimbursable.

3. Roll Out Compensation Plans to Multiple Employees.

4. (Optional) Create Spend Authorizations.

Employees without an assigned reimbursable allowance plan must create a

spend authorization and select the Expense Item associated with an Allowance
Plan. Employees must then submit it for approval and plan assignment.

5. Create Expense Reports.

Employees create expense reports and select the Expense Item linked to an
allowance plan assignment on an expense line, and submit it for review and
approval.

6. Create Manual Settlement Runs.

After expense reports with reimbursement account expense items are approved,
include them in a settlement run to reimburse employees.

7. (Optional) Access the View Reimbursable Allowance Plan Activity task.

Security:

o Self-Service: Compensation
o Worker Data: Compensation by Organization

in the Core Compensation functional area.

Review an employee's activity for an assigned reimbursable allowance plan. You

can configure this report to display on View Worker, Worker Profile, and
Talent Profile.

Related Information
Tasks
Configure Profiles and Profile Groups

Create Allowance Plans

Prerequisites
 Set up the compensation framework.
 Security: Set Up: Base and Plan domain in the Core Compensation functional
area.

Context
Allowance plans can be paid to employees as part of their regular paycheck using the
pay calculation process.

Examples:

 A cell phone allowance for a flat amount of 150 USD per month.
 An off-site reimbursement allowance of 10 percent of an employee's base pay
salary per month to offset temporary relocation.
 A car allowance of 300 miles per week paid at 3 USD per mile.

Allowance plans can also be linked to an expense item and paid to employees using the
settlement process. Example: A tuition reimbursement program for a flat amount of
2,500 USD, or a specific number of units per quarter.

Steps
1. Access the Create Allowance Plan task.
2. Select:
3.

Option Description

Reimbursable Select this check box if the allowance plan is associated with an expen
When you select this check box, you can't:

o Add a compensation element to this plan.

o Update the Percent Based Plan options.

Amount Based Plan Targets for the plan are based on a fixed monetary amount.

Percent Based Plan Targets for the plan are based on a percentage of salary.

This option isn't available if you selected the Reimbursable option.

Unit Based Plan Targets for the plan are based on a number of units.

4. In the Details section, consider:

Option Description

Inactive Select this check box if the plan isn't available for use. Processes already using

Expense Item Available if you select the Reimbursable option.

 Option Description

To be part of a settlement process, the plan must be linked to the Expense Ite

Expense Accumulator Available if you select the Reimbursable option.

Workday Expenses provides these options:

o Month to Date
o Month with Custom Start Date
o Year to Date
o Year with Custom Start Date

Allow Overage Displays if you select the Reimbursable option.

5. In the Allowance Defaults section, configure:

Option Description

Apply FTE% Displays only for amount-based and unit-based plans.

Select this check box to prorate the compensation for employees assigned to this plan based

Compensation Available if you select the Percent Based Plan option.

Basis
Select the compensation basis Workday uses to determine the target amount (if the worker i
managed by a compensation basis, Workday doesn't exclude this plan when calculating the

If you select a compensation basis that includes this plan, Workday excludes this plan when

If you select a subtractive compensation basis, Workday subtracts the subtractive basis amo
percentage-based target amount.

Compensation Unavailable if you select the Reimbursable option.

Element
Compensation elements store the earnings associated with compensation.

If you select a compensation element designated as base pay, Workday includes the plan's c

Amount Displays if you select the Amount Based Plan option.

Enter the flat amount to be paid to the employee.

Percent Displays if you select the Percent Based Plan option.

 Option Description

Enter the percent to use to determine the amount to be paid to the employee:

Allowance = (percent) X (base pay)

Number of Units Displays if you select the Unit Based Plan option.

The number of units to be paid to the employee.

Unit Displays if you select the Unit Based Plan option.

The measurement in which the employee is paid.

Per Unit Amount Displays if you select the Unit Based Plan option.

The monetary value associated with each unit.

Currency Displays if you select the Amount Based Plan or Unit Based Plan options.

The currency in which the allowance is paid.

Frequency Identifies how often you want the allowance to be paid.

No Override To prevent these values from being changed for employees assigned to the plan, select this c

o Amount
o Percent
o Number of Units
o Per Unit Amount
o Currency

 (Optional) Configure a ceiling for a percent-based allowance plan.

Enter a Ceiling Amount and a Ceiling Currency to place an upper limit on the
allowance plan.

 In the Plan Eligibility section, select 1 or more eligibility rules.

You can't use an eligibility rule more than once in a plan.

Eligibility rules determine which employees are eligible for this plan. Employees
are eligible if they meet the qualifications of any one rule. If you select multiple
eligibility rules, Workday evaluates each rule independently to determine
employee eligibility for the plan.
  If you selected an Amount Based or Percent Based plan option, select Exclude
from Merit from the Process Eligibility section if you don't want this plan
available when you initiate a merit process.
 In the Allowance Plan Profiles section, configure these:

Option Description

For amount-based plans Amount, Currency, and Eligibility Rule.

For percent-based plans Percent, Eligibility Rule, and Compensation Basis.

For unit-based plans Number of Units, Per Unit Amount, Currency, and Eligi

 If you are defining the plan to have multiple targets, it enables you to create a
single plan for what are effectively multiple plans. Example: You can set up one
profile where the target for individual contributors is 500 USD and the target for
directors is 1000 USD.

Next Steps
 To update the plan, access the Edit Allowance Plan task.

You can only update default values for plans that have not been assigned to
employees. The exception to this rule is the Compensation Element field,
which can be updated whether it is assigned or unassigned. Once you assign a
plan, defaults become unavailable for edit. Instead, make a plan adjustment
using the Set Up Allowance Plan Adjustment task or the Set Up Unit
Allowance Plan Adjustment task.

 You can hide the compensation plan type from specified groups of workers using
the Worker Data: Compensation Plan Type domain in the Core Compensation
functional area.

Example: Use this security domain to hide the compensation plan type on the
Compensation Plan Assignments report for workers in Germany. Workers can
still see the plan name.

Related Information
Concepts
Concept: Compensation Basis

Tasks
Roll Out Compensation Plans to Multiple Employees
Set Up Adjustments to Unit Salary, Hourly, Allowance, and Commission Plans
Merit
Steps: Set Up Merit Plans

Prerequisites
Set up the compensation framework.

Context
Merit plans can change base pay or promote employees to another grade or job (within
the managers span of control). When the merit plan is created and assigned to
employees, you use the compensation review process to implement proposed pay
changes. These changes can rely on an optional compensation matrix.

Steps
1. (Optional) Steps: Create a Compensation Matrix.

If you want guidelines for minimum and maximum amounts when giving merit
awards, you can create a compensation matrix.

2. (Optional) Create Eligibility Waiting Periods for Merit and Bonus Processes.
3. (Optional) Create Time Proration Rules for Merit and Bonus Processes.

Create or update the time proration rule you intend to use in the plan.

4. (Optional) Create Compensation Rounding Rules.

Rounding rules can be associated with merit, bonus, or stock plans, or with
compensation bases managed by a compensation basis total.

Security: Set Up: Merit and Bonus domain in the Advanced Compensation
functional area.

5. (Optional) Steps: Manage Compensation Basis.

6. Create Merit Plans.

Next Steps
You can also Create or Edit Compensation Packages to add the plan to the
appropriate compensation package.

Related Information
Tasks
Roll Out Compensation Plans to Multiple Employees
Reference
Reference: Compensation Plan Comparisons
FAQ: Compensation Reviews

Create Merit Plans

Prerequisites

 Set up the compensation framework.

 Security: Set Up: Merit and Bonus domain in the Advanced Compensation functional
area.

Steps
1. Access the Create Merit Plan task.
2. In the Award Calculation section, consider:

Option Description

Manage Basis Total Select if you want to apply merit increases to the total primary compensation basis for

During a merit process, Workday automatically allocates amounts to the individual pla

Allow Target Override This makes the Individual Target field available for entry on the Request Compensa
events that include this plan.

Hide Target If selected, employees can't see their target.

Target % Enter the recommended increase percentage. You can enter up to 4 decimal places.

Available for percentage-based plans only. Required for all merit plans that use a com

Workday uses this value if it can find no other target increase percent for the employee

o Have no individual target.

o Aren't eligible for any of the multiple plan profile targets.
o Are eligible for multiple plan profile targets.
o Have no target pulled from a compensation matrix.

You can use a Target % for single-target merit plans. Doing so gives you the option t

Note: Always run the Employees without Unique Targets audit report prior to launc
target.

Target Amount Available for amount-based plans only. Enter the recommended positive or negative a
employees identical merit increases (or decreases).
 Option Description

You can select amount-based merit plans when creating a compensation matrix.

Reference Currency This enables you to manage a merit plan in a single currency, but still accommodate em

Reference Frequency Available for percentage-based plans only.

Workday uses this frequency to calculate the actual cost of the bonus, plus or minus an
bonus by applying the percentage bonus target to a quarter of the annual salary.

Subject to Statutory Select to indicate that the plan is subject to statutory increases.
Minimum
If selected, Workday lists plans subject to a statutory minimum when you initiate a me
percentage. This percentage is used to calculate the merit pool if greater than the merit

Compensation Matrix Select to base merit increases on factors such as employee's performance reviews and

Use as Reference Only Available if you select a compensation matrix.

Select if you want neither an employee's individual target amount nor the pool amount
display the percentage when proposing employee awards.

Time Proration Rule Select a rule to prorate employees' target compensation in a compensation event for th
time since hire.

Time Proration Rules work off of the Process Period End Date defined on the process

3. (Optional) In the Plan Eligibility section, select a Waiting Period.

You can also access the Create Eligibility Waiting Period task.

A waiting period restricts eligibility until after the employee satisfies the waiting period criteria. By
using a waiting period, you can assign the plan at any time and rely on the waiting period to control
eligibility.

If the waiting period is still in effect as of the Process Period End Date configured on the
compensation review process, Workday:

o Includes the employee as an exception.

o Sets the suggested target percent (and prorated target increase percent, if applicable) to zero.

The pool doesn't reflect the employee target and managers can override the zero target value.

4. In the Process Eligibility section, consider:

5.
 Option Description

Include Active Employees Assigned Plan If selected, employees that were assigned to the plan during the p
During Process Period an award.

Include Active Employees in Waiting Select if you want to include employees that are assigned to the p
Period process. Workday doesn't calculate the employee target amounts

6. In the Merit Plan Profiles section, enter a Target % and select an Eligibility
Rule:

This enables you to create a single budget for what are effectively multiple plans.

You can set up 1 profile with a target for individual contributors at 3 percent and
a target for directors at 6 percent.

When the merit plan has multiple targets (plan profiles), Workday calculates the
merit pool based on the appropriate target for each employee according to the
Eligibility Rule on the plan profiles. The appropriate target percentage displays
on the employee compensation. If Workday doesn't find a unique target using
eligibility rules it uses the target percentage from the plan defaults.

Result
When the compensation review process generates the merit pool, it accounts for the
rules, profiles, and other settings in the merit plan definition to arrive at the pool
amount. This enables you to make sound budgeting decisions. The combined use of a
compensation matrix and a performance management review type enables you to pay
employees for performance based on completed review results.

Next Steps
You can hide the compensation plan type from specified groups of workers using the
Worker Data: Compensation Plan Type domain in the Core Compensation functional
area.

Example: Use this security domain to hide the compensation plan type on the
Compensation Plan Assignments report for workers in Germany. Workers can still
see the plan name.

Related Information
Tasks
Steps: Set Up Merit Plans
Add or Remove Employees to or from Compensation Review Processes
Reference
FAQ: Compensation Reviews

Steps: Create Custom Merit Statements

Prerequisites
 Download and install Workday Studio, including Report Designer, from Workday
Community.
 Enter the .rptdesign in the File Type Set Up Instructions field on the Edit
Tenant Setup - System task.
 Assign the Report Writer user group to the user modifying the report.
 Familiarize yourself with the Workday Studio documentation and tutorials for
Report Designer.

Context
Workday provides 3 merit statement formats. You can create custom merit statements
by defining a business form layout using Workday tasks and Report Designer in
Workday Studio.

Steps
1. Download the Workday Report Designs for Merit Statements from Workday
Community.
2. Make a copy of the Print Merit Statement report.
a. Access the Copy Standard Report to Custom Report task.
b. Select the Print Merit Statement report from the Standard Report
Name prompt.
c. Rename the report.
d. On the Share tab, click the appropriate share option.
e. Save the report.
3. Save the report data (XML) and XML schema (XSD) for later use in Workday
Studio.
a. As a related action off your custom Print Merit Statement report, select
Web Service > View URLs.

b. Select Workday XML > REST > Workday XML.

c. When the XML source code displays, save it as an XML file to your local
drive.

d. Select Workday XML > XSD > XSD.

e. When the XSD source code displays, save it as an XSD file to your local
drive.

Use the Save Page As feature in your browser. Don't copy and paste the
text from the browser.
 4. Use Workday Studio to create a new report layout for the report design
downloaded from Workday Community.
5. Associate your custom Print Merit Statement report with the new report
layout.
a. Access the Create Business Form Layout task.
b. In the Report Design prompt, select Create > Create Customer
Business Form Report Design Attachment.
c. Browse for the report design that you downloaded from Workday
Community.
d. Click Upload.
e. In the Custom Report field, select your custom Print Merit Statement
report.

Example
This statement is now available for selection in the Create Merit Statement Rule
task. You can select it as the default layout or can associate it with 1 or more eligibility
rules.

Related Information
Tasks
Create or Edit User-Based Security Groups
Release Merit Statements

Reference
Reference: Edit Tenant Setup - System

Bonus
Steps: Set Up Bonus Plans

Prerequisites
Set up the compensation framework.

Steps
1. (Optional) Steps: Create a Compensation Matrix.

To pay for employee performance, create or update the compensation matrix for
use with the plan.

If you must update the compensation eligibility rules for an existing

compensation matrix, change the rules using the Edit Compensation Matrix
Rules task.

2. (Optional) Define Employee Review Types

 To pay for employee performance or view it as part of the bonus proposals,
create or update the review type for the plan.

3. (Optional) Create Eligibility Waiting Periods for Merit and Bonus Processes
4. (Optional) Create Time Proration Rules for Merit and Bonus Processes
5. (Optional) Create Compensation Scorecards

The bonus process factors company performance into the bonus pool only if you
add the scorecard to the bonus plan and you have a qualifying performance
results set.

6. (Optional) Create Compensation Rounding Rules

Rounding rules can be associated with merit, bonus, or stock plans, or with
compensation bases managed by a compensation basis total.

Security: Set Up: Merit and Bonus domain in the Advanced Compensation
functional area.

7. (Optional) Steps: Manage Compensation Basis

To use Compensation Basis to calculate the target bonus of employees in

percent-based plans, configure the Compensation Basis settings for your tenant.

8. (Optional) Create Deferred Bonus Calculations

9. Create Bonus Plans

Related Information
Tasks
Roll Out Compensation Plans to Multiple Employees

Reference
Reference: Compensation Plan Comparisons

Steps: Pay for Company Performance

Prerequisites

Establish the compensation structure for the bonus plan.

Context

Factor company performance into the bonus funding.

Steps
1. Concept: Company Performance Options
 Decide how you want to fund bonuses for the organizations within the company.

2. (Optional) Edit Business Processes

Add the Manage Bonus Process Funding as the last step of the Initiate Bonus Process business
process for each supervisory organization in which you want to adjust bonus funding after bonus
approval.

Example: This step gives you the ability to adjust the bonus funding percent (% Funded) on approved
bonuses as the last step on the bonus process after company performance results have been finalized.

If you're not using this optional step for the organization, Workday recommends using the completion
step that comes in the standard business process setup.

3. Create Compensation Scorecards

Create or update the performance scorecard for the company.

You can also import scorecard data into Workday with the Put Compensation Scorecard Enterprise
Interface Builder (EIB) web service.

4. (Optional) Create Compensation Scorecard Results

Define the criteria for rating the performance of the company. You can rate company performance at
any time during the bonus plan process but when you rate performance affects bonus funding defaults.

If you want company performance results factored into the bonus funding pool, create them before
rolling out the bonus to organizations. You can add or create them later during the Manage Bonus
Process Funding step.

5. (Optional) Create Bonus Plans

Add the company performance scorecard to a bonus plan.

6. Roll Out Compensation Plans to Multiple Employees

If the bonus plan is new, roll out the bonus plan to a target population of employees.

7. Initiate Compensation Review Processes

8. (Optional) Access the Recalculate Pool and Awards task.

This task recalculates the bonus pool and awards for in-progress shared participation compensation
reviews after you update scorecard data using the:

o Edit Compensation Scorecard task, or

o Put Compensation Scorecard Enterprise Interface Builder (EIB) web service.

You must run this task after the compensation review starts and before the controller submits. As you
complete this task, consider:
 1.

Update Bonus Pool and Keep Bonus Amount Automatically selected when some approvals are complete but oth
Fixed
Keeps bonus award amounts fixed and updates the bonus pool.

Update Bonus Pool and Keep Bonus Factor % Only available if all approvals are complete.
Fixed
Workday applies the Bonus Factor % proposed against the new
updates the bonus pool.

2. Security: Process: Compensation Management Plan Employee Management

domain in the Core Compensation functional area.

Result
You have now completed the bonus process. Workday passes the employee bonus
amounts to payroll for payment.

Steps: Set Up Eligible Earnings Overrides for Bonuses

Prerequisites

Define your bonus plans and related compensation structure.

Context

Define eligible earnings when you want to use a specific value as an employee's estimated
earnings to calculate their percent of salary-based bonuses. Eligible earnings overrides can only
be used in bonus processes and merit processes with bonus awards.

Steps
1. In the Create Eligible Earnings Override Period task, define the eligible earnings period.

Security: Set Up: Merit and Bonus domain in the Advanced Compensation functional area.

2. Create Bonus Plans

To use eligible earnings as the basis for calculating bonuses, select Eligible Earnings Override as the
compensation basis.

3. Create Eligible Earnings Overrides for Bonuses

Define the eligible earnings for the employee, including the amount, the applicable period, and the
applicable bonus plans.
 4. (Optional) Before running the bonus process, view the Employees without Eligible Earnings
Override report.

Ensure that you defined eligible earnings for all employees assigned to the bonus plan who should be
receiving the bonus. To define eligible earnings, select Compensation > Create Eligible Earnings
Override from the worker's related action menu.

5. Initiate Compensation Review Processes

To calculate bonuses based on the eligible earnings, run the process for the bonus plan and eligible
earnings period.

Create Bonus Plans

Prerequisites

 Set up the compensation framework.

 Security: Set Up: Merit and Bonus domain in the Advanced Compensation functional area.

Context

You can create bonus plans to assign to employees. When Workday generates the bonus pool
through the merit or the bonus process, it takes into account the rules and target profiles in the
bonus plan.

When creating bonus plans, consider how you want to:

 Divide or consolidate bonus plans, by region, job level, job profile, or grade.
 Set up targets for each bonus plan, such as no target, a single target, or multiple targets.

Steps

1. Access the Create Bonus Plan task.

2. In the Details section, consider:
3.

Option Description

Inactive Select if the plan isn't available for use. Processes already using this plan

Compensation Element Select the element that is mapped to the payroll earning you want associa

4. In the Award Calculation section, consider:

Option Description

Compensation Basis Available if you select the Percent Based Plan option.

Select the compensation basis Workday uses to determine the target amount for this p
amount for workers managed by a compensation basis.

If you select a compensation basis that includes this plan, Workday excludes this plan

If you select a subtractive compensation basis, Workday subtracts the subtractive basi
calculating percentage-based target amount.

You can't change compensation basis if the plan is part of compensation basis that has

Target Amount Available for amount-based plans only.

Enter the amount of the target bonus award.

Workday uses the target amount when the employee:

o Doesn't have an individual target.

o Isn't eligible for any of the plan profile targets.
o Is eligible for more than 1 plan profile targets.

Target % Available for percent-based plans only.

Enter the percent of the target bonus award.

Workday uses the target % when the employee:

o Doesn't have an individual target.

o Isn't eligible for any of the plan profile targets.
o Is eligible for more than 1 plan profile targets.

Reference Currency Selecting the currency enables you to manage a bonus plan in a single currency but sti

Reference Frequency Available for percent-based plans only.

Workday uses this frequency to calculate the actual cost of the bonus, plus or minus a
bonus by applying the percent bonus target to a quarter of the annual salary.

Company Funding Determines the funding of the target bonus pool.

Scorecard
The bonus process factors company performance into the bonus pool only if you add t
scorecard results.

Plan Modifier If you want to modify the total award amount, select a scorecard.
 Option Description

Scorecard

Time Proration Rule Select a rule to prorate employees' target compensation for this plan according to time

 (Optional) Select Allow Target Override if you want to allow the default plan or
profile target to be overridden for an individual employee.
 (Optional) Select Hide Target to prevent employees from seeing their bonus
target.
 (Optional) In the Plan Eligibility section, select a Waiting Period.

A waiting period restricts eligibility until after the employee satisfies the waiting
period criteria. By using a waiting period, you can assign the plan at any time
and rely on the waiting period to control eligibility.

If the waiting period is still in effect as of the Process Period End Date
configured on the compensation review process, Workday:

o Includes the employee as an exception.

o Sets the suggested target percent (and prorated target increase percent,
if applicable) to zero.

The pool doesn't reflect the employee target and managers can override the zero
target value.

 In the Process Eligibility section, consider:



Option Description

Include Active Employees Assigned Plan Indicates that employees assigned to the plan at any point durin
During Process Period for an award.

Include Active Employees in Waiting Select if you want to include employees assigned to the plan an
Period Workday doesn't calculate the employee target amounts, which

 In the Performance Factors tab, consider:

This tab displays only if you selected Bonus Plan with Compensation Matrix
or Bonus Plan with Multiple Factors.

1.
 Option Description

Compensation Matrix or Compensation Matrix for Identifies the compensation matrix used to c
Individual Performance Factor

Use Matrix as Reference Only Available when you select Bonus Plan with

Select if you don't want the individual target

only displays the percentage when proposing

Apply Net Attainment If selected, Workday uses net attainment as a

compensation reviews.

Example: If the discretionary target with a w

50% would reduce it to 1000 USD.

Weighting (Matrix) Available when Bonus Plan with Multiple

The total weight between all compensation m

Compensation Scorecards Available when Bonus Plan with Multiple

Enter 1 or more scorecards. Workday uses th

Weighting (Scorecards) Available when Bonus Plan with Multiple

The total weight between all compensation m

Modifier If you want to modify an individual perform

2. In the Tranches tab, you can define bonus plans to be distributed in predefined
portions or installment amounts. Workday calculates the portions or installments
by prorating the overall bonus target using a tranche percent.
a. Enter the Tranche number (Example: 1, 2, 3, 4).
b. Enter the Target Percent for each amount. The column must add up to
100.
3. In the Deferred Bonus tab, consider:

You can configure the bonus plan to divide the deferred payments into an initial
cash award, followed by a stock plan disbursement.

Option Description

Deferred Bonus Eligibility Select eligibility rules.

 Option Description

Default Calculation Select a calculation created on the Create Deferred Bonus Calculation task.

Deferred Bonus Profiles Select an Eligibility Rule, Calculation, and Stock Plan for subgroups of the emp

1. Workday uses the Default Calculation and Default Stock Plan for employees
that either meet none or meet more than 1 of the deferred bonus profiles.

During bonus processes or merit processes with bonus awards, Workday uses
these eligibility rules and the associated calculations and stock plans to
determine how to divide deferred bonus awards.

Result
During the bonus process for percent-based plans, Workday multiplies the basis amount
by the target percent to derive the target amount. For amount-based plans, Workday
simply adds the targets for the employee. The bonus process then sums these
employee target amounts to derive the organizational bonus pools and the overall
bonus pool for the process.

For Bonus Plan Modifiers, Workday calculates individual employee target amounts:

Compensation Basis * Target Percent or Target Amount * Individual

Performance Scorecard Results

If you use modifiers, Workday automatically adjusts the pool and employee award
amounts.

For tranches, Compensation Administrators are responsible for rolling out the correct
number of bonus events and tranches for the bonus period. To base the final true up
bonus on the difference between the true up target and what has been paid so far in the
period, use the Complete Future Payment True Up Bonus task to calculate the final
tranche.

Example
If an employee earning 100,000 USD per year has an overall bonus target of 40% and
the target for the first tranche is 12.5%, then the employee would be eligible to receive
a $5000 bonus for the first tranche (100,000 * 0.4 * 0.125 * 1). If the manager proposes
a bonus for the employee, the suggested target bonus would be $5000 or 5%.

Next Steps
You can hide the compensation plan type from specified groups of workers using the
Worker Data: Compensation Plan Type domain in the Core Compensation functional
area. Example: Use this security domain to hide the compensation plan type on the
Compensation Plan Assignments report for workers in Germany. Workers can still
see the plan name.

Related Information
Concepts

Workday 31 What’s New Post: Individual Goals in Bonus Calculations

Tasks

Steps: Set Up Bonus Plans

Steps: Manage Compensation Basis

Add or Remove Employees to or from Compensation Review Processes

Steps: Set Up Goals

Examples

Example: Time-Based Proration for Merit and Bonus Awards

Create Compensation Scorecards

Prerequisites
 Create eligibility rules for compensation.
 Security: Set Up: Merit and Bonus domain in the Advanced Compensation
functional area.

Context
Scorecards are a list of goals and weights used to evaluate company performance. A
scorecard can have 2 components:

 Default scorecard goals

 Scorecard profile goals

A scorecard can be assigned to a percentage-based or amount-based bonus plan. A

scorecard profile is used to override the default goals and weightings using eligibility
rules.

Example: A default scorecard can be created to monitor goals for the Sales Department.
If your sales employees are in different locations, they can have slightly different goals
and weighting for 1 or more locations.
Example: You can create a company performance scorecard where customer
satisfaction has the heaviest weight:

Scorecard Goal

All Critical Issues Resolved

On-Time Product Delivery

95 Percent Customer Satisfaction

100 Million Annual Sales

Steps
1. Access the Create Compensation Scorecard task.

You can also import scorecard data into Workday with the Put Compensation
Scorecard Enterprise Interface Builder (EIB) web service.

2. Select the Inactive check box if you don't want the scorecard available for use.

If a process is already in-progress using this scorecard, it completes as normal.

3. In the Default Scorecard Goals section, enter a Scorecard Goal Name,

Scorecard Goal Description, and Weight that you want to track.

The sum weight of the goals must equal 100 percent.

Result
Rate the performance level for each criteria using the Create Compensation
Scorecard Results task. Workday uses the results combined with achievement
percentages to calculate the weighted results percent for the scorecard. If you include
the scorecard performance in the bonus plan or when you initiate the bonus process,
Workday uses the weighted results when determining bonuses.

Next Steps
You can:

 Update or delete the scorecard using the Edit Compensation Scorecard task.
 You can edit or delete scorecards only if there are no associated performance
results, or the current date is later than the Evaluation Date of existing
performance results. Example: If today is February 1 and you have one scorecard
result set for December 31 of the prior year and another for March 31 of the
current year, you can edit the scorecard only after March 31.

 Use compensation scorecards to monitor company performance as standalone

information, to influence funding up-front for a particular bonus plan, to adjust
the funding amount after bonus approvals, or a combination of the preceding.
 Use Company Performance Options Comparison Chart to evaluate the
different options available.

Related Information
Tasks

Create Eligibility Rules for Compensation

Create Compensation Scorecard Results

Prerequisites
 Create compensation scorecards.
 Security: Set Up: Merit and Bonus domain in the Advanced Compensation
functional area.

Context
Enter an achievement percent to rate the level of performance toward each goal within
the selected compensation scorecard.

Note:

You can create company funding scorecard results:

 During the Manage Bonus Process Funding step in the Initiate Bonus process, or
in the Initiate Merit process if it includes bonus awards.
 Using the Put Compensation Scorecard Results web service.

You can also update in-progress shared participation compensation review processes
with updated scorecard results using the Recalculate Pool and Awards task.

Steps
1. Access Create Compensation Scorecard Results.
2. Select the Evaluation Date on which to rate the performance.

Workday associates this date with the performance result set.

 3. For each criteria, enter an Achievement percentage to indicate how well the
company did in meeting that performance goal.

The Weighted Result Percent is the sum of Weight multiplied by

Achievement for all rows of criteria. Workday automatically calculates and
adjusts the value as you enter achievement percentages.

Result
The saved performance rating for the specified evaluation date becomes a performance
result set. A result set is a combination of the performance scorecard and the evaluation
date of the rating.

If you associate this scorecard with a bonus plan, Workday uses the company
performance result set with the most recent Evaluation Date to determine bonus
funding. If there are no results, the bonus process continues and assumes 100 percent
in calculating bonus funding.

Example

 Performance Criteria We

All Critical Issues Resolved 20%

On-Time Product Delivery 15%

95 Percent Customer Satisfaction 50%

100 Million Annual Sales 15%

If you multiply the weight by the achievement for each row and sum all of the rows, you
get a weighted funding of 110 percent.

Next Steps
To assign compensation plans to multiple employees, use the Rollout Compensation
Plans to Employees task.

Related Information
Tasks
Roll Out Compensation Plans to Multiple Employees
Create Eligible Earnings Overrides for Bonuses

Prerequisites

 Define the eligible earnings period.

 Security: Worker Data: Compensation Management by Organization domain in the Advanced
Compensation functional area.

Context

Create or edit the actual earnings amount that is eligible for bonus pay, the time period
associated with the eligible earnings, and the qualifying bonus plans. Eligible earnings overrides
can only be used in bonus processes and merit processes with bonus awards.

If you use the eligible earnings override as the calculation basis on the plan default or plan
profiles, Workday uses these eligible earnings overrides to calculate the bonus, not salary.

Steps

1. Access the Create Eligible Earnings Override task.

2. Specify the Position. This field displays only when the specified employee has multiple jobs or
positions.
3. Select the Eligible Earnings Override Period to indicate the period in which the employee's earnings
are eligible for bonus pay.
4. Select the bonus plans to associate the employee's eligible earnings with for the given period. You
can assign only 1 eligible earnings to a worker for a given plan and period.

Select Apply to All Bonus Plans to have the bonus process apply eligible earnings to any bonus plan
in which the employee participates, including newly assigned plans.

To have the bonus process apply eligible earnings to only the bonus plans that you specify, select
Restrict to Bonus Plans. If you assign new bonus plans to the employee, consider updating this list.

5. Enter the amount of the employee's Eligible Earnings Override for the given bonus plan and period.

Note: Workday doesn't calculate eligible earnings. Enter the exact value that you want the bonus
process to use as the basis for calculating the bonus.

6. Select the Currency of the eligible earnings amount.

Eligible earnings uses the frequency associated with the bonus plan.

Related Information
Tasks
Create Compensation Review Participation Rules

Reference

Reference: Participation Options

Create Deferred Bonus Calculations

Prerequisites

 Set up compensation eligibility rules.

 Set up stock plans.
 Security: Set Up: Merit and Bonus domain in the Advanced Compensation functional area.

Context

You can give employees bonuses with an initial cash payment followed by a stock grant that
vests over time. The deferred bonus calculation includes 1 or more amount ranges and
corresponding deferred percentages. You can also configure a progressive calculation.

After you create the deferred bonus calculation, you can add it to bonus plans and specify the
applicable eligibility rules and stock plans.

Steps

1. Access the Create Deferred Bonus Calculation task.

2. Select Reference Field(s).
3. (Optional) Select the Progressive Calculation check box.

If selected, Workday calculates deferred bonus payments progressively.

4. (Optional) Enter a Minimum Threshold amount.

This only displays if you selected the Progressive Calculation check box. It sets the minimum bonus
amount required for a deferred bonus progressive calculation. If the bonus amount is less than the
Minimum Threshold, Workday doesn't defer any bonus amount.

5. Configure the Definition of the calculation.

Each row defines a range of bonus amounts and the percentage of the bonus to defer.

Example: This table depicts a non-progressive deferred bonus calculation:

1.
 Range Name To Value

Tier 1 250,000 0%

Tier 2 500,000 10%

Tier 3 900,000 20%

Tier 4 1,500,000 30%

Tier Max 99,999,999 40%

2. The To Value of the each row defines the lower limit of the range for the next
row. Tier 2 has a lower limit of 250,000 because 250,000 is the To Value for Tier
1. In this deferred bonus calculation, a bonus award of 450,000 falls into Tier 2
and 10% of that award is deferred.

Related Information
Examples

Example: Deferred Bonus Progressive Calculation

Create Future Payment Plans

Prerequisites

 Create bonus plans.

 Security: Set Up: Base and Plan domain in the Core Compensation functional area.

Context

Create a future payment plan with a target that pays out to employees over several bonuses or
one-time payments. To calculate the outstanding balance, add a final true-up process at the end.

Steps

1. Access the Create Future Payment Plan task.

2. In the Future Payment Defaults section, consider:
3.
 Option Description

Allow Target Select this check box to enable the entry of a target or percent for an individual employee a
Override
To override the values for the plan and its profiles, enter an Individual Target when request

Example: Select this option to double the target for top performing individuals.

Compensation Select a default compensation element.

Element
Compensation elements store the earnings associated with compensation. If you select a com
compensation for the plan in the base pay calculation.

Reference Frequency
Workday uses the Reference Currency and Reference Frequency settings to calculate an e
if you are in a global team environment.

Related Information
Tasks

Steps: Set Up Bonus Plans

Roll Out Compensation Plans to Multiple Employees

Calculate Outstanding Balances for Future Payment Plans

Assign Future Payment Plans to Employees

Prerequisites

 Create a future payment plan.

 Security: Worker Data: Compensation by Organization domain in the Core Compensation
functional area.

Context

You can assign 1 or more future payment plans with a target that can be paid out to employees:

 Over several bonus and one-time payments, and

 A final true up process at the end to calculate the outstanding balance to be paid.

A future payment plan assignment is a package of assigned plans with an effective date.
Workday recommends that you have only 1 assignment per true up period. If the plan has
already been paid out or processed and you want to assign a new target for the following period,
make a new assignment.

Steps

1. Access the Assign Future Payment Plans task.

This task is also available as a related action off the employee, under Compensation, provided a
future payment plan is assigned.

2. Select the Effective as of date.

An assignment of future payment plans is effective from this date until the day preceding the next
set of assignments or forever if there is no subsequent set of assignments. You can't create 2 sets of
assignments with the same effective date.

The first time you create an assignment for an employee, Workday uses the eligibility rules
associated with future payment plans to determine whether the employee matches the criteria. If
the employee is eligible, Workday automatically populates Assign Future Payment Plans with this
data. If the employee doesn't match any eligibility rule, Workday displays no plans.

For subsequent assignments, Workday automatically pulls in all current plans and creates an entry
for processed plans.

If you create an assignment that has an earlier Effective as of date, Workday uses the eligibility rules
to determine which plans to display

 Consider:

Option Description

Individual Target Amount If individual targets are enabled in the plan, you can enter

Processed Indicates that the Complete Future Payment True Up

You can't delete a plan that has the Processed check box

 Result
 When you create an assignment of future payment plans to the employee,
existing ones must be carried forward. If they are not, Workday removes them
from the employee.
 Next Steps
 You can use the Complete Future Payment True Up Bonus task to calculate
the outstanding balance of a future payment or a bonus plan in tranches.
Calculate Outstanding Balances for Future Payment Plans

Prerequisites

 Assign future payment plans.

 Security: Process: Compensation Plan Events domain in the Core Compensation functional area.

Context

The Compensation or HR Administrator calculates the outstanding balance of a future payment

plan or a bonus plan in tranches to be paid to employees. The target pool represents the amount
still owed for the total true up pool. There is also no subsequent approval step. Once the
proposed bonuses are complete, they display in the bonus history.

Note: The Compensation History report displays all aspects of employee compensation.

This process doesn't address any salary changes during the period. If an employee in a future
payment plan gets a salary increase during the period, the bonus calculation for that period might
be higher. This may result in a lower target bonus during the true up process. The overall target
bonus for an amount-based true up remains the same, regardless of salary fluctuations. For a
percent-based true up, the overall target bonus fluctuates with salary changes.

Steps

1. Access the Complete Future Payment True Up Bonus task.

2. (Optional) Select Target Pay Date From and Target Pay Date To to narrow search results.
3. (Optional) Select 1 or more Organizations to narrow search results.
4. For each employee in the future payment plan, enter a Bonus Amount and a Target Payment Date.

The amount you enter is paid to the employee on the date you select.

Example

 You configure a future payment plan to consider multiple bonus and one-time payment plans.
The target for the employees is 25,000 USD. In Quarters 1, 2, and 3 the employees are paid
6,250 USD and a one-time payment of 3,000 USD. The true up process calculates the
outstanding balance of 3,250 USD.
 You configure a single annual bonus plan with an 800 USD target to be paid in three 12.5%
tranches. The tranches were 100 USD, 90 USD, and 150 USD. The true up process calculates the
outstanding balance of 460 USD.

Related Information
Tasks

Create Future Payment Plans

Rescind Bonuses for Individual Employees

Prerequisites
Enable the Rescind action for selected security groups in the Employee Bonus for Bonus
Process business process.

Context
Rescind a bonus payment for a specific employee after you have completed a bonus
process.

Note: If no organizations have completed their proposals yet, you can cancel the entire
process.

Steps
1. As a related action off the worker, select Compensation > View
Compensation History.
2. On the Bonus and One-Time Payments tab, select Business Process >
Rescind as a related action off the business process event for the worker's
bonus payment.
3. Enter a Reason to Rescind.

Result
The Workflow State for the employee's bonus payment updates to Rescinded.

Concept: Company Performance Options

Workday gives you several options for funding bonuses to factor in company
performance. You can apply company performance results to:

 The initial bonus funding pool when you set up the bonus process.

To use this option:

o Assign the compensation scorecard to the bonus plan.

o Rate company performance before the Initiate Bonus Process step.
 The updated bonus pool and/or spend for in-progress shared participation
compensation reviews.

To use this option:

o Assign the compensation scorecard to the bonus plan.

o Update company performance using the Edit Compensation Scorecard
Results task while the compensation review process is in progress.
o Use the Recalculate Pool and Awards task.
  Approved bonuses at the end of the bonus process.

To use this option:

o Add the Manage Bonus Process Funding business process step to the
organization's Initiate Bonus Process business process.
o Assign the company funding scorecard to the bonus plan.
o Rate company performance after bonus approval (once your results are
in).

You can also:

 Use the compensation scorecard as a standalone way to track company

performance.
 Give bonuses without taking company performance into consideration.

For all options you can also manually override the bonus funding percent before
committing to it.

Depending on the option you select and when you rate company performance, Workday
applies the performance results to bonus funding differently.

If You And You Rate Performance before Bonus Process

Initiation

Apply company performance to the initial Workday factors company performance results into the Performan
bonus funding pool only. bonus funding pool calculation to determine defaults. Manage B
Initiate Bo

Apply funding to approved bonuses, you must Assumes 100% funding. Workday p
add the Manage Bonus Process Funding step. to revise t

Workday f
Apply company performance to the initial Workday factors company performance results into the bonus
bonus funding pool and apply funding to funding pool calculation to determine defaults.
approved bonuses.

Use the company performance scorecard Performance results have no impact bonus funding Performan
only, not assigned to any bonus plan. calculations. The scorecard is for tracking purposes only. scorecard
 If You And You Rate Performance before Bonus Process
Initiation

Process bonuses without accounting for No impact to existing bonus processing. You aren't using No impact
company performance, not assigned to any compensation scorecards or the Manage Bonus Process scorecard
bonus plan. Funding business process step.

oncept: Future Payment Plans and True Ups

Compensation Administrators can create future payment plans to define the type of
bonus (amount or percent) and bonus targets across multiple bonus or one-time
payments. At the end of the period, the Compensation Administrator can true up a
future payment plan by paying the outstanding balance. Future payment periods can
extend beyond annual.

Typical bonus plans define the type of bonus (also amount or percent) and the plan
target. A manager can distribute a bonus target over several pre-defined bonus
payments (called tranches) and accumulate the bonus paid to date across bonus or one-
time payment plans. Bonus plan frequencies are limited to annual, monthly, or
quarterly. Bonus plans that include tranches don't use true up, but a future payment
plan can include bonus plans that use tranches.

Plan Type Security Group Descr

Future payment plan Compensation The bonus target can consider multiple bonus and one-time paym
Administrator balance.

Bonus plan with Manager The bonus target is paid out in pre-defined installments using fixe
tranches

A true up event represents a combination of fixed pay, variable pay, and short-term
incentive pay. You can set a target bonus and accrue bonuses over the year or period to
that the target bonus is reached. A true up also enables you to distribute a total bonus
in tranches over several periods. The advantage to the company is that the payout is
distributed over several tranches. The advantage to the employee is an advance on an
annual bonus. During the final bonus cycle of the period, the individual period bonuses
are totaled and reconciled against the true up target. The final payout also provides an
opportunity for managers to factor in performance against the period target for each
employee, assuming that the preceding tranches are calculated automatically.

There are 2 types of true up events:

 Single Plan True Up: The company grants an annual bonus ($800) and defines
tranches to pay out 1/8 of the target for the first 3 quarters. In the fourth quarter,
 the remaining 5/8 ($500) is paid. Alternatively, a final process calculates the
outstanding balance, paid as a true up. Workday supports this true up type within
the current bonus process.
 Multiple Plan True Up: The company sets a guaranteed minimum amount ($800),
and then awards various bonuses or one-time payments over the year. At the
end of the year, the remaining amount is paid as the true up target. If an
employee receives 3 bonuses totaling $500, the true up value is $300, which the
Compensation Administrator or Manager can adjust. The true up value can be
calculated across several bonus plans or one-time payment plans. Workday
supports this true up type with the Create Future Payment Plan task, the
Assign Future Payment Plans task, and the Complete Future Payment
True Up Bonus task.

In a single plan true up, the total bonus amount is paid in portions and the bonus target
is prorated by a percentage, called a tranche percent. Example: If an overall bonus
target is 40% and the target for the first tranche is 12.5%, an employee with an annual
base salary of $100,000 would be eligible to receive a $5000 bonus for the first tranche
(100,000 X 0.4 X 0.125 X 1). When the manager proposes a bonus for this employee,
Workday calculates $5000 or 5%. The employee receives 40% before the end of the
true up period, but not all at once. You can define tranches to regulate when bonuses
are paid and how much each portion is.

Note: The reference frequency for true up bonus plans or bonus plans with tranches is
typically annual because the true up target is generally an annual target. In other
words, the frequency reflects the true up period. If the bonus frequency doesn't reflect
the true up period, Workday de-annualizes all employees’ annual salaries and then
applies the tranche percent, which might be inaccurate.

The purpose of a future payment plan is to contain the configuration options specific to
the multiple plan true up process and the true up bonus target, currency, and
frequency. The future payment plan is also the plan used when the true up process is
launched. Future payment plans are not intended as full compensation plans. They are
defined outside of worker compensation, similar to eligible earnings, and have the same
security as eligible earnings.

Future payment plans enable you to enter multiple bonus and one-time payment plans,
but not tranches, which are defined only for bonus plans. Tranches apply to a single
bonus plan target and are part of a single bonus plan. A future payment plan target can
apply to multiple bonus and one-time payment plans.

Proration and waiting periods are not part of future payment plans. Merit Increase
Matrices (MIM) can't be defined for future payment plans. You can, however, assign a
review type to the true up plan to view performance results for the period in the true up
bonus process. Managers can also adjust recommended targets in the propose bonus
process.

To participate in a future payment plan, an employee must be assigned to the plan and
to any other relevant bonus plans for calculating the true up.

Related Information
Tasks

Create Future Payment Plans

Assign Future Payment Plans to Employees

Example: Deferred Bonus Progressive Calculation

Scenario
If you select the Progressive Calculation check box when you create a deferred
bonus calculation, Workday applies more than 1 range to the same bonus award if there
are marginal amounts.

Example: The deferred bonus calculation is:

 Range Name To Value

Tier 1 250,000 0%

Tier 2 500,000 10%

Tier 3 900,000 20%

Tier 4 1,500,000 30%

Tier Max 99,999,999 40%

Kyle receives a 1,000,000 USD deferred bonus award and the deferred bonus
calculation has the Progressive Calculation check box selected. The bonus award of
1,000,000 USD exceeds the 250,000 USD upper limit of Tier 1, leaving a balance is
750,000 USD. Workday compares that balance to the upper limit of the tier and
multiplies the smaller value by the deferral amount:

Tier Remaining Bonus Amount Difference from To Value Smaller Va

1 1,000,000 250,000 250,000

2 750,000 250,000 250,000

 Tier Remaining Bonus Amount Difference from To Value Smaller Va

3 500,000 400,000 400,000

4 100,000 600,000 100,000

Max 0 98,499,999 0

The total amount deferred for Kyle's bonus award is 360,000 USD.

Related Information
Tasks

Create Deferred Bonus Calculations

Stock
Steps: Set Up Stock Plans

Prerequisites
Set up the compensation framework.

Steps
1. Steps: Create a Compensation Matrix
2. Access the Maintain Stock Grant Types task.

Maintain the available grant types, such as ISO, NSO, RSU, or Cash, view how
many stock plans are using each type, and assign grant types to stock plans. Use
the Stock Grant Types report to list all the entered stock grant types.

Long Term Cash as a Grant Category enables you to offer cash that vests over
time like stock.

Security: Set Up: Stock domain in the Advanced Compensation functional area.

3. Access the Maintain Stock Vesting Schedules task.

You can assign vesting schedules to stock plans. Use the Stock Vesting
Schedules report to list all the entered vesting schedules.

Security: Set Up: Stock domain in the Advanced Compensation functional area.
 4. Access the Maintain Stock Date Rules task.

Create rules that Workday uses to determine the vesting or expiration date for a
stock grant. Stock date rules cannot be deleted if they have a usage count
greater then zero. Rules are a concatenation of values in the Rule Type,
Number, Unit, and From Date fields.

Example:

o Expiration Rule: 10 Years from Grant Date

o Vest From Rule: Zero Days from Event Effective Date

You can then assign stock date rules to a stock plan.

Security: Set Up: Stock domain in the Advanced Compensation functional area.

5. (Optional) Create Compensation Rounding Rules.

Rounding rules can be associated with merit, bonus, or stock plans, or with
compensation bases managed by a compensation basis total.

Security: Set Up: Merit and Bonus domain in the Advanced Compensation
functional area.

6. Create Stock Plans

Next Steps
You can place the plan into appropriate compensation packages. Plans must be tied to a
package and rule to ensure that defaults appear during staffing events.

Related Information
Tasks

Steps: Set Up the Compensation Framework

Roll Out Compensation Plans to Multiple Employees

Create Stock Plans

Prerequisites
 Set up the compensation framework.
 Security: Set Up: Stock Plan domain in the Advanced Compensation functional
area.
Steps
1. Access the Create Stock Plan task.
2. Consider:
3.

Option Description

Amount Based Plan Targets based on a fixed monetary amount.

Percent Based Plan Targets based on a percent of salary.

Unit Based Plan Targets based on a number of shares.

4. In the Award Calculation section, consider:

Option Description

Allow Target Override Select this check box if you want to allow the default plan or profile target amount, pe

Example: For top performing individuals, you want to double the target.

Hide Target If selected, employees can't see their target.

Compensation Matrix Select a compensation matrix if you want to give an individual employee stock grants
or eligibility rules.

Use as Reference Only Available if you select a compensation matrix.

Select this check box if you don't want an employee's individual target amount or the p
Only the percentage on the propose employee award of the compensation process is di

Rounding Rule Available for amount-based and percent-based plans only.

When Workday calculates the number of shares, it uses the currency amount or percen
number.

Compensation Basis Available if you select the Percent Based Plan option.

Select the compensation basis Workday uses to determine the target amount (if the wo
worker is managed by a compensation basis, Workday doesn't exclude this plan when
 Option Description

If you select a compensation basis that includes this plan, Workday excludes this plan

If you select a subtractive compensation basis, Workday subtracts the subtractive basis
calculating percentage-based target amount.

You can't change the selected compensation basis if the plan is part of compensation b

Use Target Currency Available for amount-based plans only.

for Grant
Selecting this check box causes stock grants to display in the currency of the employee

5. In the Stock Plan Defaults tab, consider:

Option Description

Target Amount/Target %/Target Shares The default recommendation for an employee assigned to this p

Currency This enables you to manage a stock plan in a single currency, b

Grant Type Any grant type created using the Maintain Stock Grant Types
Note: Cash vests over time just like stock. In reports, Workday

Vesting Schedule You can select a schedule for each Grant Type for both Stock

Expiration Date Rule Select a rule for each Grant Type for both Stock Plan Default

6. In the Stock Plan Profiles tab, enter values that differ from the defaults.

Workday uses the profiles when the criteria defined in an eligibility rule is met.

Next Steps
 You can create compensation packages.
 You can hide the compensation plan type from specified groups of workers using
the Worker Data: Compensation Plan Type domain in the Core Compensation
functional area.

Example: Use this security domain to hide the compensation plan type on the
Compensation Plan Assignments report for workers in Germany. Workers can
still see the plan name.

Related Information
Tasks

Create Compensation Packages

Request Stock Grants

Prerequisites

 Configure the Request Stock Grant business process to meet your needs.
 Use the Maintain Event Categories and Reasons task to create a reason for the Stock
Grant category.
 Set up stock plans.

Context

Managers can request a stock grant for an individual employee or for a candidate as part of an
Offer.

Steps
1. Access the Request Stock Grant task.
2. Consider:

Option Description

Amount Requested Available for stock plans based on cur

Percent of Base Salary Requested Available for stock plans based on per

Number of Shares Requested Available for stock plans based on un

Result
Workday routes the request to the appropriate reviewers, if any, for approval according
to the roles assigned to the Review Stock Grant Request step of the Request Stock
Grants business process for the employee's organization.

Related Information
Tasks
Steps: Set Up Stock Plans
Update Approved Stock Grants
Edit Business Processes

Add Stock Grants

Prerequisites
 Security: Set Up: Stock domain in the Advanced Compensation functional area.
 Configure the Request Stock Grant business process to meet your needs.
 Use the Maintain Event Categories and Reasons task to create a reason for
the Stock Grant category.
 Set up stock plans.

Context
Award a stock grant to an individual employee.

Steps
1. Access the Add Stock Grant task.
2. In the Stock Grant section, consider:

Option Description

Percent Granted Displays if the stock plan was created as a Percent.

Enter the award as a percentage of base salary.

Amount Granted Displays if the stock plan was created as an Amount Based Plan.

Enter the award as a fixed monetary amount.

Shares Granted Displays if the stock plan was created as a Unit Based Plan.

Enter the award as a number of shares.

Converted Amount Displays only for amount or percent-based plans and when the currency assigned to th

Workday converts the amount or percent granted

Vesting Schedule Displays the Vesting Schedule configured for the grant type on the stock plan or plan

Vest From Date The date that the stock grant becomes available to the employee. It's also the date that

This is often the same date as the hire date or event date.

Options Pricing Factor Displays only for amount-based or percent-based plans and when the grant category e
 Option Description

Workday converts the amount or percent granted. Workday uses the Options Pricing

Calculated Shares Displays only for amount-based or percent-based plans.

Workday calculates this value by dividing the amount granted by the Grant Price, an

Next Steps
Access the Update Stock Grant task to update approved stock grants with the grant
date, grant price, vest from date, and board approval.

Related Information
Tasks
Steps: Set Up Stock Plans
Edit Business Processes
Update Approved Stock Grants
Edit Domain Security Policies

Create Stock Participation Rate Tables

Prerequisites
 Set up the compensation framework.
 Security: Set Up: Stock domain in the Advanced Compensation functional area.

Context
Stock participation rate tables enable managers to allocate stock to large and diverse
populations of eligible employees while maintaining control over the size of the stock
pool. Eligibility rules control which employees can receive stock; participation rates
control how much each employee contributes to the stock pool.

You assign stock participation rate tables when you initiate merit processes with stock
awards or standalone stock processes. Stock participation rate tables apply to any stock
plan and any eligibility rules associated with the merit or stock process.

During the Propose step of the merit process that includes a stock award or a
standalone stock process, Workday evaluates each row of the rate table from top to
bottom. Workday assigns only the first rate that applies to the employee and doesn't
evaluate any others. If no rates apply, Workday uses the Default Percentage Rate.

To view the stock participation rate during a merit or stock process, you must use a grid
configuration that contains the Stock column group and the Stock Participation Rate
% field.
If you use a stock participation rate table in a merit or stock process, Workday disables
the Autofill and Prefill functions for stock.

You can edit stock participation rate tables using the Edit Stock Participation Rate
Table task and delete them with the Delete Stock Participation Rate Table task.
However, you can't edit or delete a rate table after it is in use in a merit or stock
process. You can copy any existing rate table when creating a new one.

Steps
1. Access the Create Stock Participation Rate Table task.
2. Enter a Default Percentage Rate.

Workday uses the default rate if it can't find a match in the rate table for an
employee.

3. Enter 1 or more rates for Workday to evaluate during the Propose step of a merit
or stock process.

Select any combination of Management Level, Job Profile, Country, and/or

Compensation Grade.

4. Enter a Percentage Rate.

5. Sort the rates in the order you want Workday to evaluate them.

Workday assigns only the first rate that applies to the employee.

Result
The stock participation rate displays on the Propose step of a merit process if it includes
a stock award or a standalone stock process.

Example
Company A has created a Stock Participation Rate Table with the following dimensions:

 Table Name: Stock Participation – Management Level and Country

 Default Percentag

Priority Management Level Country Participation Rate

Order

 Manager  United States 75%

1  Supervisor  United Kingdom
 France
 Canada
 Priority Management Level Country Participation Rate
Order

2  Manager  Brazil 65%

 Supervisor  Russia
 China
 India
 Mexico

3  Manager 50%
 Supervisor

4 Individual Contributor 10%

Next Steps
Access the Stock Participation Rate Audit report to display workers, positions,
assigned participation rate, and rate table dimensions. The report also lists multiple
matches.

Related Information
Tasks
Create Grid Configurations for Compensation
Initiate Compensation Review Processes
Manage Awards for Compensation Reviews

 e Rate: 100%

Update Approved Stock Grants

Prerequisites

 Add and approve stock grants for 1 or more employees.

 Security: Process: Compensation Management Events domain in the Advanced
Compensation functional area.

Context

Update approved stock grants with the grant date, grant price, vest from date, and board
approval.

If you want to update stock grants for more than 1 employee at a time, use the Update Stock
Grant web service.
Steps
1. Access the Update Stock Grants task.
2. Select the criteria based on the grants you want to update.
3.

Option Description

Process Only completed merit or stock processes are available.

Stock Plans Select 1 or more plans.

If you select 1 or more processes, then only the stock plans included in those processes are ava

Employees Select 1 or more employees.

If you selected 1 or more processes or stock plans, only participating employees are available f

Next Steps
To see the updated values, use the Stocks Grant Summary report.

Related Information
Tasks

Steps: Set Up Stock Plans

Set Up Compensation Reviews

Steps: Create a Compensation Matrix

Prerequisites
Security: Set Up: Merit and Bonus domain in the Advanced Compensation functional
area.

Context
A compensation matrix is a table that can help you determine merit increases, bonus
targets, or stock grants for employees. A matrix can be built using:

 Rating scales
 Potential rating
  Compa ratio
 Retention ratings
 Pay range segments

Examples:

 Give high-performing employees paid within the lower quartile of their grade
range a larger bonus or pay increase than low performing employees paid on the
high end of their grade range.
 Map out relative increases, bonus awards, or stock grants in order to reward
performance, encourage retention, and, in some cases, equalize pay within a
grade.

Merit, bonus, or stock awards can be based an employee's compa ratio. To use compa
ratio as a factor, define the compa ratio ranges that are used to build a compensation
matrix using the Maintain Compa Ratio Range task.

Use the Edit Compensation Matrix Rules task to change the name and
compensation eligibility rules for an existing compensation matrix as of a specific date.

Steps
1. Access the Create Compensation Matrix task.
2. Select the factors you want to use to build the matrix:

Option Description

Weighted Select this option, if you want the minimum and maximum target ranges to be b
percentage amount.

Use Above and Below Available if Include Pay Range Segments is selected.
Segments
Indicates that in addition to the rows identified in the Number of Segments fie
Segment.

Number of Segments Available if Include Pay Range Segments is selected.

Use Multiple Targets Select this check box if you want the matrix to apply to specific employees that

Eligibility Rules Select 1 or more eligibility rules to identify the target population for which you

3. Enter the Minimum and Maximum values for each row of the matrix.
4. (Optional) Access the Maintain Compa Ratio Range task.

Enter the Segment Top.

 The segment top is the maximum value for the compa ratio range. Examples:
you can create rows for 25, 50, 75, 100 and 125 that results with ranges of:

o 0 - 25% (0 - 25.000)
o 25 - 50% (25.001 - 50.000)
o 50 - 75% (50.001 - 75.000)
o 75 - 100% (75.001 - 100.000)
o 100 - 125% (100.001 - 125.000)
o 125% and greater (125.001 +)
5. (Optional) Access the Edit Compensation Matrix Rules task.
o Convert a single target matrix to a multi-target matrix and update the
name to reflect its new purpose.
o Add or remove compensation eligibility rules for a multi-target matrix.

Result
You can now assign the compensation matrix to a merit, bonus or stock plan.

When you process the plan, Workday uses the compensation matrix factors and
associated plan targets to calculate the pool and provide managers with target ranges.
You can also assign the matrix to a merit plan as reference only.

Related Information
Tasks

Review Promotions in a Merit Process

Create Compensation Grades

Create Compensation Packages

Create Grid Configurations for Compensation

Reference

Reference: Compensation Step and Grade Progression Reports

Steps: Prepare for Compensation Reviews

Prerequisites
Set up the compensation framework.

Steps
1. Set Up Compensation Review Business Processes .
2. Edit Domain Security Policies
 If you want to include stock in the merit process, anyone assigned to configure
stock pools or issue stock grants must have access to these security domains in
the Advanced Compensation functional area:

o Worker Data: Stock Grants.

o Worker Data: Propose Stock Award as Part of Merit.

If you want to print merit statements, configure these security domains in the
Advanced Compensation functional area:

o Worker Data: Merit Statements domain, so managers can print statements

for their direct reports.
o Self-Service: Merit Statement domain, so employees can print their own
statements.
3. (Optional) Access the Edit Tenant Setup - HCM task.

Select the Hide Create New Merit Statement Button for Employee on
View Merit Statement History check box.

4. (Optional) Determine if your event is large enough that you need to work with
the Workday Production Readiness team.

When running compensation reviews for a large number of employees, Workday

recommends:

o Schedule the review period and carefully decide on the key dates:
Initiation, Compensation Snapshot Dates, Organization Snapshot
Date, and Effective Date.
o Avoid overlap between the compensation review and any major deadlines
for other customer activities or large volume events.
o During the final week of the compensation review, check the schedule for
long running background jobs, integrations, and reports.
o Schedule whether and when to print merit statements.

See Best Practices for Large Customer Events for guidelines about opening a
Production Readiness case.

5. (Optional) Add Worklets to Business Processes

You can add worklets to these classic compensation review business processes to
provide relevant analytic information for this task. These business processes
aren't compatible with shared participation compensation reviews.

o Propose Employee Merit Award.

o Propose Employee Bonus Award.
o Propose Employee Stock Award.
6. Create and assign compensation plans.
7. (Optional) Steps: Manage Compensation Basis
 For merit processes only, define how Workday manages merit changes for an
employee:

o To determine individual targets for percent-based plans and enter award

amounts for each plan assigned to the employee, use total base pay. For
this option, you don't have to create a compensation basis; Workday
provides it for you.
o To determine individual target amounts for percent-based plans, use the
primary compensation basis. Enter a total amount for the award letting
Workday allocate that amount to the individual plans that make up the
primary compensation basis.
8. Access the Maintain Event Categories and Reasons task.

Create event categories and reasons for giving each award.

Security: Set Up: Staffing domain in the Staffing functional area.

9. (Optional) Access the Maintain Currency Rate Types task to create a new type
specifically for compensation review processes.

Configure at least 1. If no rate types exist, Currency Rate Type doesn't display
on the Create Compensation Process Template or when initiating
compensation review processes.

10. (Optional) Reference: Edit Tenant Setup - HCM.

Workday limits the number of employees (in the same organization hierarchy)
displayed to a Planner. You can enter a Preferred Compensation Review
Employee Awards Grid Limit or allow Workday to use the Default
Compensation Review Employee Awards Grid Limit of 100.

11. (Optional) Create Compensation Review Participation Rules

Define rules that Workday uses to handle compensation-related events that

occur after the initiation of the compensation review process.

12. (Optional) Steps: Create Custom Merit Statements

Create employee merit statements to meet reporting requirements.

13. Create Grid Configurations for Compensation

Grid configurations can include read only, editable, or advanced fields for drilling
down into details. Example: Add an Errors field to include Critical and Warning
errors in merit, bonus, or stock processes.

14. (Optional) Create Stock Participation Rate Tables

 Applies only to stock processes or merit processes that include stock awards.

15. (Optional) Access the Create Compensation Process Template task.

Create templates to enable Workday to populate fields in compensation review

processes. See Initiate Compensation Review Processes and Manage
Compensation Review Pools for detailed field descriptions.

Related Information
Concepts

Concept: Performance Best Practices for Large-Scale Events

Tasks

Review Promotions in a Merit Process

Release Merit Statements

Manage Funding for Bonuses

Update Approved Stock Grants

Set Up Compensation Review Business Processes

Context

Set up 1 or more of these business processes for compensation reviews:

 Initiate Merit Process

 Initiate Bonus Process
 Initiate Stock Process

You can also include bonus or stock awards consolidated with the Initiate Merit Process.

Workday doesn't pay out stock plans. You can integrate with a third-party stock administration
application to manage vesting and other stock administration needs.

Business process configuration differs for shared participation compensation reviews compared
to classic compensation reviews.

Note: Don't delete business process condition rules if they're associated with compensation
plans, regardless if the plans are active or inactive. Doing so might result in unexpected errors.
You can't recover deleted condition rules.

Steps
1. For shared participation compensation reviews only:
a. Edit the business process policy and add the Compensation Administrator role to the
Complete Employee Awards step. Use the Activate Pending Security Policy Changes task
to modify the rest of the business process.

This role oversees the compensation review process, monitors organization status, maintains
pools, and reviews employee participation.

b. Remove Propose Employee Award steps; they can't be used with shared participation
compensation reviews.

c. Select Shared Participation for the Type on the Complete Employee Awards step and assign
it to the Compensation Administrator or other roles that can control the entire process.

d. Click Configure Participation.

Select the Organization Type and the Group (role) to use in shared participation
compensation reviews.

Cost centers are hierarchical organizations only when grouped as a cost center hierarchy.
When configuring the participation on the business process, there's 1 role that is the
participant for both the organization and the organization hierarchy. The same role then must
exist on both organization and organization hierarchy.

e. For bonus awards:

 Select a Plan Modifier Scorecard on the bonus plan.

 Access the Recalculate Pools and Awards with Latest Scorecard Results task.
2. For both shared participation and classic compensation reviews:
a. The Manage Impacted Employees step must be the second step in the business process.

b. Set up the Configure Pool, Distribute Pool, Launch Employee Award steps.

c. (Optional) Set up the Manage Bonus Funding step for bonus processes or merit processes
with bonus awards.

If you include bonus awards in a merit process, make Manage Bonus Funding the completion
step.

d. (Optional) Set up the Manage Stock Funding step for stock processes or merit processes with
stock awards.

This can be the completion step.

3. For classic compensation reviews only:

Set up these steps for their respective compensation review processes:

o Propose Employee Merit Award

o Propose Employee Bonus Award
o Propose Employee Stock Award

These steps must include an approval step.

 The Propose Employee Merit Award step can optionally include Review Promotion.

For bonus processes or merit processes that include bonus awards with a high number of bonus plans,
Workday recommends that you use the shared participation compensation review. Use the classic
compensation review only if you have a small number of bonus plans.

Related Information
Tasks
Steps: Configure Business Process Definitions

Steps: Set Up Shared Participation Compensation Reviews

Context

The shared participation compensation review process enables:

 Managers and planners to participate in a single process to award employees.

 Human Resources personnel to support planners and managers.
 The ability to move the planning to the next planner, or send back to the prior planner.
 Visibility into all aspects of the process.
 Ability to manage the process across multiple organizations within the planner's
hierarchy.

Steps
1. Enable domains (in the Advanced Compensation functional area) and assign roles:

1.

Domain Roles

Process: Compensation Management Events Compensation Administrator Required to initiate

Plan compensation
Process: Compensation Review Process Planners: organizations.
Participant
o Manager Requires Modify ac
o Primary compensation planner

Process: Compensation Review Process Manager Required for access

Controls

Process: Compensation Review Process Support roles: View and edit emp
Controls
Can have either Vie
 Domain Roles

o HR Partner
o Compensation Partner

Process: Compensation Review Process Reviewers: View and/or edit th

Reviewer
o Location partners Can have either Vie
o Regional managers

2. Set Up Compensation Review Business Processes .

3. Initiate Compensation Review Processes
4. Access the Inbox item for the compensation review process just initiated.

Result
Workday initiates the process and sends a notification to the managers responsible for
making awards to employees and to the Compensation Administrator and HR Partner
that support them.

Workday sends notifications when you create custom notifications in the related
business process on the Shared Participation step.

Next Steps
Run these reports to review the date, time, responsible party, and notes for the last
submitted change to awards:

 Compensation Review Merit Award Audit

 Compensation Review Talent Audit
 Compensation Review Bonus Payment Audit
 Compensation Review Stock Plan Award Audit

Related Information
eference
FAQ: Merit, Bonus, and Stock Pool Calculations
Workday 31 - Next Participant Only in Compensation Reviews

Create Eligibility Waiting Periods for Merit and Bonus Processes

Prerequisites
Security: Set Up: Merit and Bonus domain in the Advanced Compensation functional
area.

Context
Create or update a compensation eligibility waiting period, which defines the rule for
whether employees are eligible for a merit raise or a bonus. You base the rule on a
single value, such as a hire date. If you run a merit or bonus process before the waiting
period expires, Workday enables you to add the employee in the waiting period as an
exception with a target of zero.

Employees in the waiting period aren't awarded the bonus or increase when the waiting
period is over. Run the merit or bonus process again after the waiting period is over to
give awards to employees in the waiting period.

Steps
1. Access the Create Eligibility Waiting Period task.
2. Enter the Number and select a Unit value for the rule logic. .

Example: To configure a 1 year waiting period, select 12 and Months.

3. Select a From Date from which Workday starts counting.

4. If you are basing the waiting period on the Date of Last Base Pay Increase,
select the Excluded Criteria to identify events Workday won't consider as an
increase.

You can select any number of staffing and compensation events to exclude.

Example
When employees are in the plan and in the waiting period as of the Process Period
End Date, Workday includes them in the process as exceptions with a target of zero.
Assume:

 An eligibility waiting period of 3 Months from Hire Date

 The plan has the Include Active Employees in Waiting Period check box
selected.
 The hire date is October 6.
 The compensation review process has a Process Period End Date of December
31.

If the plan didn't have the Include Active Employees in Waiting Period check box
selected, Workday wouldn't include plan employees in the process. If the hire date was
October 1, the waiting period would no longer apply and employees assigned to the
plan are eligible.

Next Steps
Assign the waiting period to merit and bonus plans. You can assign the same waiting
period to multiple plans.

Related Information
Tasks
Steps: Set Up Bonus Plans
Steps: Set Up Merit Plans

Create Time Proration Rules for Merit and Bonus Processes

Prerequisites
Security: Set Up: Merit and Bonus domain in the Advanced Compensation functional
area.

Context
You can create proration rules that Workday uses to determine the portion of the target
amount employees receive in merit or bonus processes.

You can use proration rules on various criteria:

 Base pay changes.

 Changes in bonus or merit plans.
 Leave of absence.
 Time since hire.

Workday evaluates proration rules associated with merit or bonus plans during merit
processes with bonus awards or with standalone bonus processes. The Process Period
End Date on the Initiate Merit Process or Initiate Bonus Process tasks determine
when Workday applies proration rules.

Steps
1. Access the Create Time Proration Rule task.
2. (Optional) Select a Leave of Absence Grace Period Table.

Grace period tables can only be used in shared participation compensation

reviews.

If none exist, access the Create Leave of Absence Grace Period Table task
and create at least 1. Each grace period table must have:

o Leave Type
o 1 or more Location Hierarchies
o Grace Period Days
3. Select the Proration Criteria you want to use to calculate the individual target
amount and contribution to the award pool.
 To exclude certain types of events, select Excluded Criteria. You can define
types of Excluded Criteria in the Maintain Event Categories and Reasons
task.

Note: Workday always uses the most conservative criteria. Example: If you use
both Time Since Hire and Time Since Continuous Service date in the same rule,
then Workday uses the most recent criteria to prorate.

1.

Option Description

Base Pay Changes in Example:

Period
o Process Period = 1/1 to 6/1.
o Employee had a salary change on 4/1.

Workday uses 2 calculations to determine the total target amount: 1 for the salary betwe
6/1.

FTE Changes in Workday evaluates FTE % changes that occur between the initiation of a bonus process
Period Date. When the FTE % changes during the process period, Workday divides the bonus p

Example:

Anna is eligible for a bonus for a process period from January 1 to June 1. Anna's FTE %

Workday calculates Anna's total target amount twice: once for the FTE % from January

Leave of Absence If selected, Workday subtracts any leave of absence taken by the employee from the pro
Table, Workday subtracts the grace period from the total number of days on leave.

Scorecard Profile Workday prorates bonus awards based on changes in scorecard profiles when the bonus
Changes in Period
o Compensation matrix modifier.
o Performance factor scorecard.
o Performance factor scorecard modifier.
o Plan modifier scorecard.

Example: Marie is a hotel manager and her bonus plan is based on the customer satisfac
of the year, then transfers to Wichita for the rest of the year. Her customer satisfaction s

Workday calculates Marie's total target with 2 proration segments: one from January 1 t
plan target amount of 10,000 USD, Marie's bonus calculation is (10,000 * 0.75 *

Workday creates a proration segment when these business processes cause a bonus scor
the Process Period End Date:

o Change Job
 Option Description

o Change Organization Assignment

o Move Workers (by Organization)
o Move Workers (Supervisory)

Target Changes in Example:

Period
o Process Period = 1/1 to 6/1.
o Target percent on Bonus Plan changed from 5% to 10%.

Workday uses 2 calculations to determine the total target amount: 1 for the target percen

Next Steps
Assign the time proration rule to merit and/or bonus plans. You can assign the same
time proration rule to multiple plans.

Related Information
Tasks
Steps: Set Up Bonus Plans
Steps: Set Up Merit Plans

Create Compensation Rounding Rules