For most government-mandated HR reporting, you set up for a given GRE either a single-establishment hierarchy, or multiple-establishment hierarchies. If you have multiple establishments, you may also need a headquarters hierarchy for the establishment representing your enterprise headquarters.
The same basic rule applies to all the establishment hierarchies you build (but not to the AAP hierarchies used for AAP reporting). This rule is:
In a non-AAP establishment hierarchy, an organization classified as a Reporting Establishment can never be subordinate to another organization classified as a Reporting Establishment.
This means that in an establishment hierarchy, a GRE/Reporting Establishment can be the top organization, or Reporting Establishments can be subordinate to a GRE (and optionally to HR Organizations). But a Reporting Establishment cannot be subordinate to another Reporting Establishment.
Establishment hierarchies constructed for AAP reporting are exceptional because this reporting is based on the affirmative action plans existing within a GRE. This means that in AAP establishment hierarchies:
establishments appear as subordinates of AAP Organizations representing the affirmative action plans
AAP Organizations (which may also be Reporting Establishments) can appear at various levels in the hierarchy, and can be subordinate to other AAP Organizations (which may also be Reporting Establishments).