This topic is a worked example of the steps for setting up a combination plan structure across three business groups. Use this type of plan setup to use a single budget amount to allocate awards across different types of compensation. For example, you can allocate salary increases, bonuses, and stock option awards from the same budget, also on the same worksheet.
This sample setup creates plans in US, UK, and Canadian business groups. You can replace these with business groups relevant to your enterprise. This sample setup is an example of how you can set up a global combination plan to award salary increases and bonuses. In this example, the US business group is the master business group in which you define the global plan.
Note: Ensure you use the business group in which you define the global plan to complete administrative processing.
Note: You should have defined your business groups and set up conversion rates before you complete your plan design.
The Total column in the Compensation Summary table within the Allocate Compensation task does not provide a real total for each row of data. This is because you define budgets at the plan level in this sample setup. You can hide the option level columns (global merit and global bonus) using Personalization, so that managers will not be confused. The table displays an example of the data provided in the Compensation Summary table based on this sample setup.
| Compensation Summary | Total | Global Merit | Global Bonus |
|---|---|---|---|
| Eligible Employees | 100 | 100 | 100 |
| Employees Receiving | 95 | 95 | 95 |
| % Receiving | 95 | 95 | 95 |
| Total Eligible Salaries | 1,500,000 USD | 1,500,000 USD | 1,500,000 USD |
| Budget | 150,000 USD | 150,000 USD | 150,000 USD |
| Budget as % of Total Eligible Salaries | 10% | 10% | 10% |
| Total Allocated | 145,000 USD | 90,000 USD | 90,000 USD |
| Unused Budget | 5,000 USD | ||
| Average Allocated as % of Eligible Salaries | 9.67% | 6% | 3.67% |
Use this sample setup if your business requirements are as follows:
Each country has a country-specific currency
You publish budgets in a single currency - in this example, we use US dollars
You publish budgets as a percentage of eligible salary
You enable line managers to update rankings and rate employee performance.
You enable line managers to view and update employee assignment information
You administer salary increases annually
You limit access to plans for line managers for a specific period - in this example, they have access to the plan from January 1, 2006 until December 31, 2006
You disallow updates to the plan beyond a particular date - in this example, this date is November 30, 2006
You display all person-related information as of a specific date - in this example, we display all person related information as of January 1, 2006
You use the Supervisor Hierarchy for Approvals
You enable managers to submit worksheets for approval at any time.
Define Plan Years as follows:
01-JAN-2005 - 31-DEC-2005
01-JAN-2006 - 31-DEC-2006
01-JAN-2007 - 31-DEC-2007
01-JAN-2008 - 31-DEC-2008
Define a Life Event called Global Combination with Compensation as the Type.
Define another Life Event called US Combination with Compensation as the Type.
Define a Derived Factor called Stated Salary, where US dollar is the currency, Stated Compensation is the source, Annually is the Stated Compensation Periodicity, select the No Minimum and No Maximum check boxes, and As of Event Date as the Determination Code.
Define a Plan Type called Combination Plan, where Compensation Workbench is the Option Type and Combination Plan is the Compensation Category.
See: Defining Plan Types
Define an Option called Global Salary Increase, where Combination Plan is the Plan Type. The application automatically updates the Group Option field and the Group Option check box when you save your work.
Define another Option called Global Bonus.
Define local options for US Salary Increase and US Bonus. For each local option, in the Group Option field, select the corresponding global option name.
See: Defining Options
Define a Plan called Global Combination Plan with Combination Plan as the Plan Type, May Not be in a Program as the Usage, US dollar as the Currency, and Annually as the Activity Reference Period.
Add all the plan periods you defined to your plan, and add the following tasks:
| Task Type | Self-Service Task Name | Access |
|---|---|---|
| Set Budgets | Set Budgets | Full Access |
| Job Changes/Promotions | Update Assignment Information | Full Access |
| Performance Ratings | Rate Employee Performance | Full Access |
| Allocate Compensation | Award Bonuses | Full Access |
| Manage Approvals | Approve Awards | Full Access |
| Review and Submit | Review & Submit | Full Access |
Attach the Global Salary and Global Bonus options to the plan. Set the status to Active.
Define a Plan called US Combination Plan with the same parameters as the Global Combination Plan.
Note: For this plan you must also select the Restrictions tab and select Global Combination Plan as the Global Plan Name.
Attach the US Salary and US Bonus options to this plan.
Define Plan Enrollment Requirements for the Global Combination Plan as follows:
Select Explicit as the Method in the Enrollment alternate region.
On the Scheduled tab, select Compensation as the Enrollment Type.
In the General alternate region, enter 01-JAN-2006 as the Start and 31-DEC-2006 as the End as the Enrollment or Availability Period.
Enter 01-JAN-2006 as the Assigned Life Event Date.
Select Global Combination as the Life Event.
Select When Elections Are Made as the Close Enrollment Date to Use.
Select 01-JAN-2005 to 31-DEC-2005 as the Year Period.
In the Coverage alternate region, select Event as the Enrollment Coverage Start Date. Select 1 Day Before Event as the Enrollment Coverage End Date.
Select the Rates alternate region and select Elections as the Rate Start Date. Select 1 Day Before Event as the Rate End Date
In the Budget alternate region, select the Uses Budget check box if you use budgets. Select Store Budgets as Percentages in the Preserve Budget Column.
In the Miscellaneous alternate region, select Supervisor Hierarchy as the Hierarchy to Use and select At Any Time as the Approval Mode of Submission.
In the Performance alternate region, enter 01-Dec-2006 as the New Ratings Become Effective date.
In the Miscellaneous alternate region, enter 01-JAN-2006 and 30-NOV-2006 as the Self Service Worksheet Update Period Start and End dates. Select Full Access as the Default Worksheet Access and enter 01-JAN-2006 as the Freeze Date. Select Periodic Review as the Salary Change Reason.
Define Plan Enrollment Requirements for the US Combination Plan with the same parameters as the Global Combination Plan.
Note: For the US Basic Bonus Plan, select US Combination as the Life Event instead of Global Combination.
Define Standard Rates as follows:
For Distribution Budgets
Create a new rate called Global Combo Plan - DB.
Select Plan as the Level.
Select Global Combination Plan as the Compensation Object.
Select Not Applicable as the Tax Type.
Select CWB Distribution Budget as the Activity Type.
Clear the Element and Input Value Required check box.
On the Calculation Method tab, select Flat Amount as the Method, select the Enter Value at Enrollment and the Calculate for Enrollment check boxes. Enter 0 as the Minimum, 1000000000 as the Maximum, 1 as the Increment Amount, and 0 as the Default. Select Round to Nearest One as the Rounding Code.
For Budget Reserves
Create a new rate called Global Combo Plan - RB with the same parameters as you define for the Distribution Budget.
Note: For this rate, select CWB Reserve as the Activity Type.
For Worksheet Budgets
Create a new rate called Global Combo Plan - WB with the same parameters as you define for the Distribution Budget.
Note: For this rate, select CWB Worksheet Budget as the Activity Type.
Worksheet Amounts
Create a new rate called Global Combo Plan - WA with the same parameters as you defined for the Distribution Budget except the following:
Select Global Combination Plan as the Compensation Object.
Select CWB Worksheet Amount as the Activity Type.
Clear the Element and Input Value Required check box.
Select the Enter Value at Enrollment and Calculate for Enrollment check boxes in the Calculation Method tab.
On the Processing Information tab, select Combination Plan as the Compensation Category.
Eligible Salary
Create a new rate called Global Combo Plan - ES with the same parameters as you defined for Worksheet Amounts except the following:
Select CWB Eligible Salary as the Activity Type.
Select Not Applicable as the Tax Type.
Clear the Element and Input Value Required check box.
Ensure to select the Calculate for Enrollment check box.
On the Calculation Method tab, select Multiple of Compensation as the Method.
Select the Calculate for Enrollment check box.
Clear the Enter Value at Enrollment check box.
Enter 1 as the Multiplier and select Multiply by as the Operator.
Select Stated Salary as the Compensation Factor.
See: Defining Activity Rates for a Standard Contribution/Distribution
Follow the same steps to set up rates for US Combination Plan, US Combination Plan - Salary, and US Combination Plan - Bonus.
To create the setup for the UK and CA plans, follow the steps you completed to define Plan Years, Derived Factors, and Life Events. Use Plan Design Copy to copy the rest of the setup.
Note: Ensure you copy the US Combination Plan and all its child records into your UK and CA business groups one at a time. Do not copy the global plan.
To copy the US Combination Plan, you must do the following:
On the Plan Design Copy page, select the link to copy and enter UK Combo as the Plan Name.
Enter 01-Jan-1990 as the Effective Date.
Select your US Combination Plan.
Select the Target Category as Different Business Group.
Select your UK business group as the Target Business Group.
Enter 01-Jan-1990 as the Effective Date to Copy.
Select Reuse existing objects if current name exists in target as the Reuse Method.
Enter a Prefix of UK.
Note: Ensure that the Global Combination Plan is the Global Plan and verify that the copied compensation objects names are updated to UK or CA as required. Also, ensure you change the currency for these local combination plans as required.
Note: Optionally, update the rate names as well.