Compensation Settings
What is Compensation Settings?
Compensation Service Settings allows administrators to configure the various aspects of employee compensation in your organization, this includes selecting the salary tracking method, linking hike push with Performance Service, adding currency, managing salary structure, configuring permissions, applicability and more.
Compensation Settings is intended for Administrators and HR Personnel
What can you do in Compensation Settings?
- Getting started wizard
- Setup general preferences
- Adding and manging currency information
- Defining salary structure
- Manage salary packages
- Manage salary revision letter templates
- Setting up permissions
- Add or manage compensation administrators - Configure approvals
- Setup automation
- Extending the compensation service
Getting Started Wizard
When you access Compensation service for the first time (settings or user service), you will be introduced to a getting-started wizard, which will walk you through the basic steps of setting up and using the compensation service.
- To start the process, Access Compensation Service in Settings and click Get Started
- Select the base currency to use in your organization and the currency format:
This will be the base operating currency in your organization, and currencies added later with respect to different locations, calculations, and conversions will be equated to the base currency selected here. Click Next to proceed. - Select applicable roles:
Compensation Service will be accessible for the roles selected here. However, access to view other employee data depends on permissions defined for that particular role. (For example, the manager role may be given permission to view other employees salaries, whereas the team member role may be granted access only to view their own salary) Click Next to proceed. - Select compensation administrator:
- The super administrator is assigned as the default compensation administrator. (super administrator access can be removed later).
- All performance administrators are given access to salary data, even if they are not made compensation administrators.
- Existing administrators who have not been assigned as compensation administrators will have permissions to view their reportee data or the permissions assigned to them under performance administrators. In otherwords, besides super administrator or designated compensation or performance administrator, all other administrators will act as non-administrators in compensation service.
Click Next to process. - Finally, click Enable.
Configuring Compensation Service
To configure compensation settings in Zoho People, go to Settings > Configuration > Compensation tab.
- Select a salary tracking method that is more suitable for your organization. If you want to store and track salary breakup along with benefits, choose the second option.
- Employee Pay Only
This option tracks only the employee’s total pay (cost to the company) without detailing the individual components. It helps maintain a basic salary record and captures historical changes in total pay over time. - Detailed Employee Pay Tracking with Benefits and Breakup
This method stores a comprehensive breakdown of the employee's salary, including individual pay components, allowances, and benefits. It allows for detailed tracking of each element and maintains a history of all salary-related changes. - Enable Re-authentication for enhanced security. When enabled, the user will be required to verify their password once again to confirm their identity. The time limit for requiring reauthentican can be customized.
- Choose if you want all salary hike pushes to be approved through the compensation service. To do this, enable the Hike Push Sanction option.
- If you want to send revision letters as PDF attachments, enable the "Attach revision letter to revision letter published notification" option. The PDF will be password-protected, and the password will be sent separately. Otherwise, users will get a secure link to view it in Zoho People.
- Zoho People can display salary information with up to two decimal places. However, if you wish to round-off the value to the nearest whole number, enable the Round-off option.
Here is an example of how currency value will be displayed with and without round-off option:Original Value Displayed (Round-off Disabled) Displayed (Round-off Enabled) 80.65$ 80.65$ 81$ 999.667$ 999.67$ 1000$
Currencies
As employees may operate from different locations, various currency details may need to be stored. A maximum of 20 currencies can be stored in the compensation service. Reports can also be viewed based on specific currencies. Apart from the base currency, other currencies can be enabled or disabled based on the organization's needs.
To add a new currency:
- Navigate to Settings > Compensation > Currencies.
- Click Add Currency.
- Select the currency to use.
- Select the format in which the currency should be displayed.
- Enter the exchange rate between the base and selected currency. For example, 1 AED = 22.29 INR.
> If a currency is mapped to a salary package to an employee, it cannot be disabled.
> The currency page in compensation is only accessible to compensation administrators.
What is base currency?
Base currency is the primary currency used for financial operations within an organization. It serves as the reference point against which other currencies are measured, calculated, and converted. Any additional currencies introduced later for different locations or purposes are linked and compared to the base currency for consistency and standardization.
Salary Structure
Salary structure is useful if your organization wants to store detailed salary information. This is suitable when you want to store salary along with salary component breakup.
Salary structure can be configured in Settings > Compensation > Configuration > Salary Structure.
Organizations that want to maintain only the salary information can disable Salary Structure.
Salary structure is maintained using salary packages. Salary packages consist of salary components, namely, salary components and benefits.
Salary components
All the parts that make up the salary of an employee can be added here. Let's look at some of the main features of salary components:
- The components are further split into salary components and benefit components.
- Withins salary and benefit components, certain primary components cannot be edited.
- Additional custom components that are used in your organization can be added here.
- Components can be cloned to simplify the process of adding additional ones.
- Location-specific components can be added to store location-specific salary data.
- Changes made to components can be tracked.
Salary components
Parts that make up the salary are the salary components. The following have been given as system salary components:
- Basic pay
- House rent allowance (HRA)
- Provident fund (PF)
- Fixed allowance - this is the remaining amount that is derived after all other salary components have been allocated. (total salary - (sum of other salary components + variable pay)
- Fuel allowance
- Education allowance
- Conveyance allowance
Basic pay can either be entered as a flat amount or as an % value during the initial setup. The method used cannot be changed once it is associated to employees.
Basic Pay Salay Components cannot be disabled, other components can be disabled (if they are not associated to any salary package).
Benefit components
Other parts that make up the benefits are the benefit components. Benefits are given in addition to the salary. The following have been given as system components:
- Bonus
- Medical insurance
- Gift card
- Meal pass
Adding a salary component:
- Navigate to the Settings > Compensation > Salary Structure > Salary Components.
- Click Add Component and select Salary Components from the drop-down.
- Enter the name, code, and description.
- Select the applicable location. All locations will be selected by default, but it can be changed.
- Select if this component is a fixed or variable payment type.
- If fixed pay has been selected above, define if this component is a flat amount or a percentage, or derived using formula. If variable pay has been selected, define if this component is a flat amount or a percentage of salary.
When using the "Fixed Pay" type, you can utilize the formula calculation type. Here, you can use mathematical functions, select pay components, and add operators to define how the calculation is derived. Use the "Insert," "Check Syntax," and "Formula Expression" fields to define, check, and finally save the formula used for calculation. - Select the payment frequency (monthly and annualy for fixed pay. Monthly, quaterly, half yearly and annually options for variable pay)
- Select the status of this component.
- Click Save.
> Flat amount, formula options are only available when setting up salary for the first time (initial setup).
> Once a component is mapped to a salary package, the selected calculation type cannot be edited, but the calculation values can be altered.
> Components added for a specific location will be available to be mapped only for a salary package of the same location.
> Once a component is mapped to a salary package, it cannot be disabled or deleted.
Adding a benefit component can be done using the same steps mentioned above.
Salary Package
A unique combination of salary and benefit components mapped to a set of employees is called a salary package. By default, there will only be one salary package. Multiple salary packages can be added for different sets of employees, specific locations, designations, and other organizational structure entities.
To configure salary packages, go to Settings > Compensation > Configuration > Salary Structure > Salary Packages.
> Applicability cannot be changed for the default salary package.
> A package assigned to employees cannot be disabled.
> Components of a salary package, once assigned to employees, cannot be altered, but their values can be changed.
> Packages added for a specific location will be available for mapping only for employees belonging to that specific location.
> A location cannot be removed from a package, if any employees are assigned to it.
> A designation cannot be removed from a package if employees of that designation are assigned to it.
Add Salary Package
- To add a salary package, navigate to Settings > Compensation > Configuration > Salary Structure > Salary Package
- Click on Add Salary Package
- Enter an identification name for the salary package and a description
- Configure applicability. You will have options to select locations, streams, designations and more.
- Salary range options include different criteria (select drop-down), it can be setup as indicated in screenshot below or as per your requirement.
When tagging an employee to a salary package but their salary is not within the range or critera defined here, it will be still allowed, but a cautionary note will be displayed.
- Select salary currency to use, and input the total salary (per annum). You can choose to map salary and salary benefit components as required.
- Finally click Save.
Tagging a Salary Package to an employee
- Go to Operations > Compensation > Employee Salary > Add Salary
- Select employee, salary package, enter the salary, effective from data and remarks.
Click here to learn more about adding salary and about revising salary for employees.
Revision Letter Templates
Create ready-to-use salary revision templates to quickly generate revision letters for your employees. Multiple templates can be created and all of these templates can be customized as required.
Revision letters uses Zoho Writer's Mail Merge Templates. Learn more about mail merge templates.
- To create a new template click Add Revision Letter Template. You also have an option to import letter templates.
- The created templates can be edited or deleted.
- Templates are fully customizable. Simply select a data source and add fields to have a template ready in no time.
IMPORTANT INFO
Mail merge feature uses credits. A free Zoho Writer account includes 1,000 credits per month, allowing up to 1,000 merges. If you need more merges, you can upgrade to a flexible plan in Zoho Writer and purchase additional credits as needed via add-ons. Learn more about buying automation credits in Zoho Writer. (You can also track your credit usage.)
Mail merge feature uses credits. A free Zoho Writer account includes 1,000 credits per month, allowing up to 1,000 merges. If you need more merges, you can upgrade to a flexible plan in Zoho Writer and purchase additional credits as needed via add-ons. Learn more about buying automation credits in Zoho Writer. (You can also track your credit usage.)
To generate revision letters, navigate to Operations > Compensation > Salary Revision Letters > Generate Revision Letters
DID YOU KNOW?
You can automatically attach revision letters as password-protected PDF files in the notification email when they're published!
The password will be sent separately for added security. If this option is turned off, users will simply get a secure link to view the letter directly in Zoho People.
To enable and use this feature, navigate to Settings > Compensation > General and enable 'Attach revision letter to revision letter published notification' feature.
To enable and use this feature, navigate to Settings > Compensation > General and enable 'Attach revision letter to revision letter published notification' feature.
Setting Up Permissions
First, let us configure access permissions for the compensation service.
Manage Applicability
The compensation service will be viewable based on the roles selected in this section. The employees belonging to the roles selected here will immediately have basic access and be able to view their own compensation data. Additional data accessibility is based on the permissions set under the permissions tab.
Roles selected under applicability will have basic access to their own compensation data. Further permissions within compensation can be set under the permissions tab under settings.
To manage applicable roles go to Compensation > Permissions > Manage Applicability.
To manage applicable roles go to Compensation > Permissions > Manage Applicability.
To configure permissions for these added roles, go to Settings > Compensation > Permissions > Salary.
Here you can customize access for compensation service and related data for the various roles.
Here are some key points to note:
- Roles can be given permission to see either reportees' data or all employees' data.
- All employee data can be shared to specific locations or all locations.
- Reportee data cannot be restricted based on location.
- Permission can be given to View salary, View/Edit salary breakup, View/Edit benefits, Add salary, Add salary revision, and View salary revisions.
- View salary permission must be given in order to give other permissions.
Compensation Administrators
As the compensation service contains highly sensitive data, it is important that we are able to restrict access and management to selected employees. This is made possible by assigning users as compensation administrators, who will have exclusive access to the compensation settings and data. Within compensation, other existing administrators will be considered non-administrators and you will need to assign an alternate role for them.
To assign compensation administrators:
- Navigate to Settings > Compensation > Permission > Compensation Administrators tab.
- Select the employee you want to assign as a compensation administrator.
- Give them permission for settings, data, or both.
- Select the applicable locations. It can be for all or specific locations.
> Once a new compensation administrator is added, the super administrator's access to the compensation serrvice as an administrator can be removed.
> A compensation administrator who is given data permission for all locations will be able to view and make changes to all the salary data of all employees. They will not be able to view or make any changes to any configurations, such as adding or editing the salary structure, editing any components, or altering any settings.
> A compensation administrator who is given data permission for a specific location will only be able to view and make changes to all the salary data of all employees of that location.
> A compensation administrator who is given settings permission for all locations will only be able to make configuration changes to the salary structure and other settings. They will not be able to view or make changes to the salary data of employees.
> A compensation administrator who is given settings permission for a specific location will only be able to make configuration changes to the salary structure and other settings related to the employees of that specific location. For example, if they are a settings admin for the Chennai location, they can make changes to a salary component or salary package added for the Chennai location alone.
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