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Whitaker-Taylor Insights

The Benefits of Globalizing Pay Structures in SAP

Jun 6, 2016 1:13:11 PM / by Jamaal Gillison

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Pay_Structure.jpgAs your company grows, often the number of jobs, positions and pay scales grows exponentially. When you have employees in different cities, the HR structure of the company is so important. If you create separate pay scales for each job in various locations, then chances are you soon will find it to be an inefficient system. Here’s why—if you need to make a mass change in regards to pay scales to your job structure, you would need to individually maintain each job’s planned compensation. This process can be tedious and time consuming, especially if you are a large organization.

So what’s the better alternative? I’m glad you asked! A way to simplify this process is to create one singular job with attached pay scales from multiple locations. For example, let’s say you have an “HRIS Analyst” job located in 13 various locations, and each location pays at a different rate. Instead of having 13 jobs with one-to-one jobs and planned compensation relationships, you can simply change the configuration to allow for a one-to-many relationship. So now you can have one job where you store all your planned compensation data for locations around the world. Take a look below at these three huge benefits to structuring your system in this way.

1. Saves Time and Easy to Maintain

This strategy can save you time in the event of a reconstruction of the jobs in your system. For example, if you no longer needed the job “HRIS Analyst,” then only one job would need to be delimited or deleted instead of all 13 of them. Also if you needed to add new locations to the job, it is as easy as simply adding the location-specific pay structures instead of having to create a new job and associated pay scale for each new location.

2. Simplifies Comparisons by Centralizing Information

Having all the pay structures attached to one job has the benefit of centralizing information. It’s simple to access and interpret data. For example, end users will more easily be able to find a job and compare and contrast pay structures across various locations.

3. Ensures Consistency and Reduces Errors

The one-to-many job and pay structure relationship ensures that employees are assigned to the correct jobs and are given the proper associated pay scale. By using this feature in SAP, mistakes such as assigning an employee the wrong job or job location can be prevented. There would only be one job, and, based on how the TARIFF feature tree is set up, the employee will get the correct pay scale according to his default pay scale area and type.

So you can see that configuring your system to allow multiple pay scales to a single job can be beneficial in many ways. If you are interested in learning more about this strategy or other ways to achieve efficiencies in your HR processes contact us today. 


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Topics: SAP

Jamaal Gillison
Written by: Jamaal Gillison

Jamaal Gillison is a SAP analyst working for Whitaker-Taylor. He graduated from Kennesaw State University in Georgia, with a bachelor in Information Systems. Jamaal’s areas of expertise are Personal Administration, Organizational Management, and Benefits. He currently operates out of Atlanta, Georgia.