Budget Pools and Compensation Components

To align a compensation component with organizational strategies and policies, you can select a budget pool. You can even select the same budget pool for multiple compensation components.

For example, your plan includes the Merit, Bonus, and Market Adjustment compensation components that you can configure with the Monetary Allocation budget pool.

For budget values to increase and decrease according to managers' allocations, you need to link the budget pool to a compensation component. Any budget pool that you create for the plan and don't link to a compensation component just shows static budgetary information.

Primary Component for Budgeting

When you have multiple components with the same budget pool, you need to select Primary component for budgeting for one of the components. The salaries of the people who are eligible for the primary component determine the total eligible salaries used for their managers' budgeting.

For example, of the three configured components, you make Merit the primary budgeting component. The total eligible salaries for managers' budgeting include the salaries of their people who're eligible for Merit. The totals exclude their people who are eligible for Bonus, Market Adjustment, or both, but aren't eligible for Merit.