How Grades and Grade Rates Work with Jobs, Positions, Assignments, Compensation, and Payroll

You use grades and grade rates in the following components of Oracle Fusion HCM to ensure that workers are compensated according to the grade structure that you create.

• Jobs

• Positions

• Assignments

• Compensation

• Payroll

How Grades Work with Jobs and Positions

You can define one or more grades that are applicable for each job and position. Using this list of valid grades, combined with the settings for two profile options you restrict the grades that can be selected when you set up assignments for a worker.

Note the following:

• If you use positions, then the grades that you assign to jobs are the default grades for the positions that you associate with each job.

• You can use the default grades for the position, remove ones that don't apply, or add new ones.

How Grades Work with Assignments

When you set up assignments, you can select the applicable grade for the job or position.

Two profile options determine the grades that are available for selection:

Profile Option	Description
PER_ENFORCE_VALID_GRADES	If you set this site-level profile option to Yes: Users can select a grade only from the list that you defined for the job or position. If users select both job and position for the assignment, they can select grades that are valid for the position only. If valid grades are defined for neither job nor position, then users can select from all grades. If you set this site-level profile option to No: User can select from all the grades This is also the default value
PER_DEFAULT_GRADE_FROM_JOB_POSITION	If you set this site-level profile option to Yes and there is only one valid grade for a job or position: The grade is used by default in the assignment. If an entry grade is defined for a position, then that grade is used by default when the user creates a new assignment. If you set this site-level profile option to No: User can select from all the grades This is also the default value

How Grades and Grade Rates Work with Compensation and Payroll

Depending on the configuration of the legal employer to which workers belong, their salary can be stored at the assignment level. The grade rate can be linked to the salary basis within the salary record, in which case their salaries are validated using the grade rates.

For example, assume an assignment record for a worker indicates they're in Grade A1 with the salary of USD 40000.00:

• The grade rate range that's attached to Grade A1 is 30,000.00 USD to 50,000.00 USD. Therefore, the salary is within the grade rate range and no warnings are issued.

• If their manager or a human resource (HR) specialist changes their salary to 55,000.00 USD, a warning is issued that the new salary is outside their salary range.

In addition, compa-ratios and salary range positions for workers are calculated using the minimum and maximum amounts that are defined in the grade rates for their grades.

Payroll elements reference grades in the eligibility criteria. For example, assume you want to process a bonus for all workers who are at grade level A2. To accomplish this, you would create an earnings element for the bonus and specify A2 for the grade in the eligibility criteria. The result of this setup, when combined with additional eligibility criteria that may be applied by the bonus plan, is that when payroll is processed, workers who are at grade level A2 and who meet the additional eligibility criteria would receive the bonus.