Compensation Management Setup & Configuration Guide

This comprehensive guide walks you through the complete setup and configuration of Compensation Management, from initial core app enablement to advanced settings optimization. Follow these steps to establish a robust compensation management system for your organization.

Who this is for: Business Administrators and HR Administrators setting up Compensation Management
Prerequisites: Business Administrator access to System Modules
Estimated Time: 30-60 minutes for complete setup

🎯 What You’ll Accomplish

• Enable and configure the Compensation Management core app
• Set up default currency, pay frequency, and calculation parameters
• Configure approval workflows and user permissions
• Establish data validation rules and security settings
• Prepare for initial employee compensation data entry

📋 Before You Start

Required Access:

• Business Administrator or Super Admin role
• Access to System Modules section
• Understanding of your organization’s compensation structure

Information to Gather:

• Default currency for your organization
• Standard pay frequencies (weekly, bi-weekly, monthly, etc.)
• Approval workflow requirements and hierarchy
• List of users who need compensation management access
• Existing compensation data (if migrating from another system)

Dependencies to Consider:

• User Management must be configured with employee records
• EPMS (if planning to use Merit Matrix integration)
• Payroll Connect (if planning payroll system integration)

🚀 Step-by-Step Setup Guide

Step 1: Enable Compensation Management Core App

1. Navigate to Admin → System Modules
2. Locate the Compensation Management card in the System Modules section
3. Click the toggle switch to enable the app

💡 Tip: The system will automatically validate dependencies and create the necessary database structures when you enable the app.

Success Indicators:

• Toggle switch shows “Enabled” status
• “Compensation Management” appears in admin navigation menu
• Access to compensation management features is available

Step 2: Initial Configuration Access

1. Click Compensation Management in the admin navigation menu
2. You’ll see a message: “Compensation Management is now enabled”
3. Click Advanced Settings in the More Actions dropdown to begin configuration

What You Should See:

• Dashboard with placeholder statistics
• Navigation menu with compensation management options
• Access to advanced settings and configuration options

Step 3: Configure Basic Settings

Navigate to Compensation Management → More Actions → Advanced Settings

Currency & Regional Settings

Default Currency Configuration:

1. Select your organization’s primary currency from the dropdown
2. This will be the default for new employee compensation records
3. Multiple currencies can be used for individual employees if needed

Default Pay Frequency:

1. Choose the most common pay frequency in your organization:
   • Weekly (52 pay periods per year)
   • Bi-weekly (26 pay periods per year)
   • Semi-monthly (24 pay periods per year)
   • Monthly (12 pay periods per year)

Annual Hours Setting:

• Default: 2,080 hours (40 hours/week × 52 weeks)
• Used for salary ↔ hourly rate conversions
• Adjust if your organization uses different standard work hours

Step 4: Configure Approval Workflows

Auto-Approval Settings

Enable Auto-Approval:

1. Check “Enable automatic approval for small changes”
2. Set percentage threshold (recommended: 5%)
3. Set dollar amount threshold (recommended: $2,000)

Approval Rules Configuration:

Configuration Options:

• Auto-Approval Percentage Threshold: 5% (changes under this percentage are auto-approved)
• Auto-Approval Amount Threshold: $2,000 (changes under this amount are auto-approved)
• Require Manager Approval: ✅ Enabled for changes above thresholds
• Require Admin Approval Above: $10,000 (large changes need administrative approval)
• Approval Reminder Days: 3 days (reminder frequency for pending approvals)

Step 5: User Access & Permissions

Role-Based Access Configuration

Navigate to User Management → Roles & Permissions to configure compensation access:

Business Administrator Access:

• Full compensation management access
• Bulk operations and import/export
• Advanced settings configuration
• Audit trail access

HR Administrator Access:

• Employee compensation management
• Analytics and reporting
• Import/export capabilities
• Audit trail review

Manager Access:

• View team member compensation (optional)
• Request compensation changes
• Access to team analytics
• Approval workflow participation

Employee Access:

• View own compensation information (optional)
• Access to personal compensation history

Step 6: Data Validation & Security Rules

Validation Rules Setup

Configure data validation to ensure compensation data integrity:

Salary Validation:

• Minimum salary: $15,000 annually (adjust for your market)
• Maximum salary: $500,000 annually (adjust for your organization)
• Increment validation: Changes must be in $100 increments

Hourly Rate Validation:

• Minimum hourly rate: $7.25 (federal minimum wage or local requirement)
• Maximum hourly rate: $250.00 per hour
• Increment validation: Changes must be in $0.25 increments

Effective Date Rules:

• Cannot be more than 30 days in the past (configurable)
• Future dates allowed up to 1 year ahead
• Must be a valid business date

Security Configuration

Audit Trail Settings:

• Log all compensation changes
• Track user access to compensation data
• Retain audit records for 7 years (compliance requirement)
• Generate monthly audit reports

Step 7: Integration Configuration

Merit Matrix Integration (if using EPMS)

Setup Steps:

1. Ensure EPMS is enabled and configured
2. Verify performance review data is available
3. Configure merit calculation parameters in Merit Matrix
4. Test integration with sample data

Integration Benefits:

• Performance-based compensation recommendations
• Automated merit increase calculations
• Data-driven compensation decisions
• Integrated approval workflows

Payroll Connect Integration (if using)

Configuration Requirements:

1. Enable Payroll Connect app
2. Configure your payroll system connection (ADP, Workday, Gusto, etc.)
3. Map compensation fields to payroll system fields
4. Schedule regular data exports

Step 8: Initial Testing & Validation

Test Core Functionality

Create Test Employee Compensation Record:

1. Navigate to Compensation Management → Employee List
2. Select a test employee or create a test user
3. Click Edit to add compensation information
4. Enter test salary and verify calculations work correctly
5. Save and verify the record appears in the system

Test Approval Workflow:

1. Create a compensation change that requires approval
2. Verify notification is sent to appropriate approver
3. Test approval and rejection workflows
4. Confirm audit trail captures all actions

Test Import/Export:

1. Export current (limited) compensation data to CSV
2. Modify the CSV file with test changes
3. Import the modified file
4. Verify changes are applied correctly

✅ Configuration Checklist

Core App Setup

• Compensation Management core app enabled
• Navigation menu updated with compensation options
• Access permissions verified for administrators

Basic Settings

• Default currency configured
• Default pay frequency set
• Annual hours parameter configured
• Calculation rules established

Approval Workflows

• Auto-approval thresholds set
• Manager approval requirements configured
• Admin approval thresholds established
• Notification settings configured

User Access

• Role-based permissions configured
• User access levels assigned
• Manager access rights established
• Employee visibility settings configured

Data Validation

• Salary range validation rules set
• Hourly rate validation configured
• Effective date rules established
• Security settings configured

Integration Setup

• Merit Matrix integration configured (if applicable)
• Payroll Connect integration set up (if applicable)
• Data mapping verified
• Export schedules configured

Testing & Validation

• Test employee compensation record created
• Approval workflow tested
• Import/export functionality verified
• Audit trail functionality confirmed

🔧 Advanced Configuration Options

Custom Approval Workflows

For organizations with complex approval requirements:

Multi-Level Approval Setup:

1. Navigate to Advanced Settings → Approval Workflows
2. Configure department-specific approval chains
3. Set escalation rules for delayed approvals
4. Configure delegation options for manager absences

Batch Approval Configuration:

• Enable batch processing for multiple compensation changes
• Set batch size limits for performance optimization
• Configure batch approval notifications and reporting

Industry-Specific Templates

Available Templates:

• Technology Sector: Higher salary ranges, equity compensation options
• Healthcare: Shift differentials, certification bonuses
• Manufacturing: Hourly rates, overtime calculations
• Retail: Seasonal adjustments, commission structures
• Non-Profit: Grant-funded positions, volunteer coordination

Advanced Analytics Setup

Custom Reports Configuration:

1. Define key performance indicators (KPIs)
2. Set up automated report generation
3. Configure dashboard widgets for executives
4. Establish benchmark data sources

💡 Best Practices

Implementation Strategy

Phase 1 - Foundation (Week 1):

• Enable core app and basic configuration
• Set up user access and permissions
• Configure approval workflows

Phase 2 - Data Setup (Week 2):

• Import existing compensation data
• Validate and clean data records
• Train key administrators

Phase 3 - Rollout (Week 3):

• Train managers and HR staff
• Begin processing real compensation changes
• Monitor system performance

Phase 4 - Optimization (Ongoing):

• Analyze usage patterns and feedback
• Refine approval thresholds and workflows
• Expand advanced feature usage

Security Best Practices

Access Control:

• Implement principle of least privilege
• Regular access reviews and updates
• Strong password requirements for compensation access

Data Protection:

• Regular backup verification
• Encryption for sensitive data transmission
• Compliance with local privacy regulations (GDPR, CCPA, etc.)

Change Management

Communication Strategy:

• Announce implementation timeline to organization
• Provide training materials and documentation
• Establish feedback channels for users

Training Plan:

• Administrator training on full system capabilities
• Manager training on approval workflows and team analytics
• Employee communication about new processes and access

❓ Troubleshooting Common Setup Issues

Core App Enablement Issues

Issue: Core app toggle doesn’t respond or shows error
Solution:

• Verify you have Business Administrator privileges
• Check that all prerequisite apps are functioning
• Clear browser cache and try again
• Contact support if issue persists

Permission Problems

Issue: Users can’t access compensation features after setup
Solution:

• Verify role assignments in User Management
• Check business-level permissions
• Ensure users are properly associated with the business
• Review and update role-based access settings

Integration Failures

Issue: Merit Matrix or Payroll Connect integration not working
Solution:

• Verify dependent apps are enabled and configured
• Check data mapping configurations
• Test with sample data first
• Review integration logs for error details

📚 Next Steps

After completing setup, proceed to:

1. Individual Employee Compensation Guide - Learn daily operations
2. Overview & Analytics Dashboard Guide - Explore reporting capabilities
3. Import & Export Guide - Manage bulk data operations
4. Advanced Settings Guide - Optimize system configuration

This setup guide ensures your Compensation Management system is properly configured for your organization’s needs. For additional assistance, consult the troubleshooting guide or contact your system administrator.