Steps: Create a Compensation Matrix

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

You can configure a compensation matrix to help you determine merit increases, bonus targets, or stock grants for employees during a compensation review. You can build a classic compensation matrix with:

Rating scales.

Potential rating.

Compa ratio.

Retention ratings.

Pay range segments.

You can also configure a total value compensation matrix based on a custom conditional calculation that incorporates skills from the job profile, performance, or other worker attributes.

Examples:

Give high-performing employees paid within the lower quartile of their grade range a larger bonus or pay increase.

Plan relative increases, bonus awards, or stock grants in order to reward performance, encourage retention, or equalize pay within a grade.

During compensation reviews, managers can see a suggested range that uses performance, talent, and market data to determine the award.

Access the

Create Compensation Matrix

task.

Select the type of compensation matrix:

Optie	Omschrijving
Classic Compensation Matrix	Configure a matrix based on rating scales, potential rating, compa ratio, retention ratings, and so on.
Total Value Compensation Matrix	Configure the matrix with a custom calculation that evaluates worker attributes. Example: Terry doesn't have a review rating and Workday can't calculate a performance factor using a classic compensation matrix. By using a total value compensation matrix with a custom calculation, you can default a 2 percent factor for workers like Terry that don't have a review rating.

As you complete this task, consider:

Optie	Omschrijving
Amount	An amount matrix is for amount-based stock, bonus, or merit plans and consists of an exact amount for the minimum and maximum bonus amount, and a default currency. The exact amount can be positive or negative and up to 2 decimal places. Example: Terry has an amount-based stock plan with a 10,000 target. Terry has a performance rating of 3-Meets Expectations. The compensation matrix has a Minimum of 8000, a Maximum of 12500, and the default currency is USD. The recommended stock grant for Terry ranges from 8,000 to 12,500 USD.
Percent	A percent matrix can be used for percent-based stock, bonus, or merit plans and consists of the exact percent for the minimum and maximum values. Example: Casey has a base salary of 100,000. Casey has a performance rating of 3-Meets Expectations. The compensation matrix has a Minimum of 2% and a Maximum of 3%. The recommended merit increase for Casey is 2-3% based on a percent-based matrix with Review Rating = 3, Minimum = 2%, and Maximum = 3%.
Weighted	A weighted matrix can be used for amount- or percent-based bonus or merit plans. It can also be used for an amount-, percent-, or unit-based stock plan. Use a weighted matrix if you want the minimum and maximum target ranges based on a factor used to derive the targets for a plan based on a percentage amount. Example: Haley, has a percent bonus plan with a 6% target. Haley has a base pay of 100,000 and receives a performance rating of 3-Meets Expectations. The weighted matrix has a Minimum of 50% and a Maximum of 75%. The recommended bonus range is: Minimum = 100,000 * 0.06 * 0.5 = 3,000. Maximum = 100,000 0.06 0.75 = 4,500.
Use Above and Below Segments	Available if you selected Include Pay Range Segments . Adds rows for Below Segment 1 and Above Top Segment to the matrix. Enter the Number of Pay Range Segments .
Use Multiple Targets	Select this check box if you want the matrix to apply to specific employees that match 1 or more eligibility rules. Select 1 or more Eligibility Rules to identify the target population for the matrix.
Calculation	For a total value compensation matrix, select a custom calculation that determines a default factor. You can edit the calculation even when the compensation matrix is used in an in-progress event, provided the calculation produces a numeric value. See Setup Considerations: Calculations
Default Currency	Select a default currency. Select Apply Currency to apply your choice for Currency to all eligibility rules displayed in the Currency by Eligibility Rule list. Apply Currency displays for amount-based matrixes with Use Multiple Targets selected.
Currency by Eligibility Rule	(Optional) Select the currency for each eligibility rule.
Compensation Matrix	Enter the Minimum and Maximum values for each row of the matrix. Workday doesn't automatically enforce the minimum and maximum values you enter. To enforce the minimum and maximum, you must create custom validations. See Steps: Set Up Custom Validations.

You can also use the Get Compensation Matrices
and Put Compensation Matrices
web services.

(Optional) Access the

Maintain Compa Ratio Range

task.

Enter the

Segment Top

to establish the maximum value for the compa ratio range.

Create the compa ratio ranges you'll use for the compensation matrix.

Examples: you can create rows for 25, 50, 75, 100 and 125 that results with ranges of:

Zero - 25% (zero - 25.000)

25 - 50% (25.001 - 50.000)

50 - 75% (50.001 - 75.000)

75 - 100% (75.001 - 100.000)

100 - 125% (100.001 - 125.000)

125% and greater (125.001 +)

(Optional) Access the

Edit Compensation Matrix Rules

task.

Convert a single target matrix to a multitarget matrix and update the name.

Add or remove compensation eligibility rules for a multitarget matrix.

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.