MERIT PLANNING USER GUIDE 2018 Merit Planning Cycle Revised 10/13/2017 Purpose The purpose of this guide is to provide you with instructions to enter merit planning data into Workday. If you have specific questions or need additional information, please contact your local Human Resources professional.
Table of Contents Welcome... 2 A Few Things to Note before Getting Started:... 2 High Level Overview of Merit Planning Workflow... 3 Detailed Instructions and Tips for Merit Planning... 3 Managers of Managers Navigation Icons & Actions:... 4 ALL Managers Navigation Tips for the Merit Grid:... 5 STEP 1: Enter the Annual Performance Rating... 6 STEP 2: Enter the Merit Increase... 7 Validations... 7 STEP 3: Submit... 8 Compensation Review Dashboard: Worklets, Tasks, and Reporting... 9 Worklet: Average Merit Increase by Performance... 10 Worklet: Pay Differentiation Factor... 11 Task: Search... 11 Report Tools... 12 Report: Merit Spend Summary... 12 Report: Employee Detailed Merit Analysis... 12 Report: Merit Audit Report... 12 Appendix: How To Make A Merit Recommendation... 13 Page 1 of 13
Welcome Trustmark Companies encourages the recognition of performance and achievement through the use of merit pay increases. To make the most of the quarterly performance review process and annual merit planning process, tools and resources are available on Workday HQ. A Few Things to Note before Getting Started: 1. Workday is the system used for shared planning and approving. Username and Password questions should be directed to IT: ithelp@trustmarkcompanies.com or 866.784.2576 2. Important Dates: a. 11/1 11/17: Planning Window i. 11/1 (Wednesday): HR launches the annual event. ii. 11/17 (Friday): Management chain planning is due. b. 1/3 1/18: Merit Statements can be generated by managers to review with associates. c. 1/19: Merit Statements are released in Workday to associates. d. 1/19: New pay is effective 12/31, which is the pay date of 1/19. 3. Changes this year: a. The new Annual Performance Rating scale will be used for planning merit recommendations. This rating scale is the foundation for achieving pay differentiation. b. Pay Differentiation: As part of our new performance review process, managers differentiate performance of associates using ratings. Now, as part of merit planning, managers will have an increased focus on rewarding our highest performing associates, with higher merit increases. c. A NEW Compensation Review dashboard on your Workday home page. Tools are designed to provide insight for you to manage differentiating pay. d. Instead of having two separate planning cycles for Senior Leaders and Below Senior Leaders, we will have one combined cycle. e. No proration to the merit budget for associates hired after January 1, 2017. Instead, managers will use their discretion to plan what they feel is appropriate. f. Promotions are not part of the merit planning cycle this year, but they can still be initiated in Workday, outside of the merit process. 4. Eligibility: a. New hires hired after October 1 st are not eligible and will not be in the planning grid. b. Associate on a leave of absence are included, and should have their merit increase planned for during this window. The increase will have an updated effective date matching the date they return from eave. c. If you have questions about who is or is not included, please contact your HR Business Partner. Page 2 of 13
High Level Overview of Merit Planning Workflow Enter the Annual Performance Rating Enter the Merit Increase Submit Detailed Instructions and Tips for Merit Planning This next section will go through the details of each of the 3 steps in the process. When the event is launched by HR, supervisors and managers (anyone with 1+ direct report) will receive a task in their Workday inbox and an email sent to their Outlook email. Planning cannot be started until the notification is received. To expand the inbox task, click the icon to toggle to full screen viewing mode: The Inbox Task will be 1 of these 2: 1. Managers of Managers will have an Organization Summary page, which tracks the overall budget (pool) and spend, as well as providing the tools needed to view and assist with planning for subordinate organizations. 2. Managers of Individual Contributors (which are not managers) will have a Propose Awards page, where they are able to begin the merit planning for their own organization. The next two pages are navigation tips. If you are a Manager of Managers, both pages will be helpful for you. If you are a Manager of Individual Contributors, please review the ALL Managers Navigation Tips for the Merit Grid page. Page 3 of 13
Managers of Managers Navigation Icons & Actions: Expand the grid to show your subordinate organizations by clicking the org chart icon: To view planning for subordinate organizations, click the magnifying glass: By clicking either the org chart icon or the magnifying glass icon within each row, you can continue drilling in to different organizations. To return to the top level or other levels, either click the name of the org at the top of the grid (blue font = drillable), or click the button at the bottom of the grid, which will be either Continue or Return to Top Level depending on where you are and which method you used to arrive there. To read, write or exchange comments with other planners, click the text box icon: To plan your own direct reports merit awards, click the edit icon: in the top row of the grid, where Workday lists your own org. Then follow the steps in the next section: Enter the Annual Performance Rating. Actions Column of Organization Summary: When Search Employees is selected, you will be brought to a faceted search screen. It can be used to find individual or groups of employees based on the facets. Select the check box or boxes to pick the associates you are searching for, and once they are listed in the Results side, check the top box to select all. Click the orange button at the bottom to bring up the selected associates into a planning grid. Complete on Behalf is an action that can be taken if a Manager of Managers wishes to complete the merit planning for a subordinate organization. You are required to check a box to confirm you want to pull forward this organization, and you are required to enter a comment. Click the Complete on Behalf button at the bottom of the screen. Note: This will send the subordinate manager a notification in Workday and send an email to their Outlook email. The manager will see the comments. After completing the steps above, on the Organization Summary screen, the magnifying glass icon for viewing will change to the pencil icon for editing. Send Back can be used to send the event planning back to the manager one level below. You will be required to enter a comment. If there are supervisory organizations with validation errors, you will have an Action item in the Action column drop down menu to View Employees with Errors. Page 4 of 13
ALL Managers Navigation Tips for the Merit Grid: Information is saved real-time in Workday as you enter it. There is not a Save button. Two tabs: Performance and Merit. The performance tab is for selecting the Annual Performance Rating, and the Merit tab is where the merit planning is completed. Sort the associate data by clicking any of the column headers. Click and drag the boundary to the right of the column header to adjust column width. The first four columns are locked (Associate, Current Tercile, Current Base Pay and Validations). On the bottom and on the right side of the grid there are scroll bars to use for showing all columns within the grid. On the Merit tab, there is a Smart Panel on the right, with informative details for each associate. The Overall Budget (Pool) and Spend Indicator (displayed below) will be dynamically updated as you enter merit and lump sum amounts. The budget amount is calculated by Workday when HR launches the annual event it is a percent of salaries at the supervisory organization level. Merit budgets do not change when higher level managers navigate to their subordinate organizations. Percent of budget spent Budget for entire organization Page 5 of 13
STEP 1: Enter the Annual Performance Rating Enter the Annual Performance Rating On the Performance tab, select the Annual Performance Rating (required) from the dropdown. In future years, managers will factor in the four quarterly performance ratings and exercise managerial judgement to consider the whole year. For the transition year in 2017, managers will determine the Annual Performance Rating based on the Q3 performance review, mid-year reviews from the old performance review process, and other job-relevant data (e.g. KPIs, production targets). Managers are empowered with the discretion to determine Annual Performance Ratings for their associates. Along with the discretion, is the responsibility to make those decisions using critical reflection. Below are a few tips to help make decisions: 1. Frequency: If an associate receives the same rating 3 or 4 times during the year, typically, that is also their Annual Performance Rating. Following this tip will likely cover most of your associates. 2. Identify outliers: We anticipate the majority of associates will fall in the Performing category. For associates that have less consistent quarterly ratings, remember the purpose of ratings is to identify outliers higher and lower performers so that they can be financially rewarded accordingly. Therefore, determine if an associate, in general for the year, matches the Excelling or Struggling definitions. Please recall the overall guidance Trustmark suggests for larger departments/groups (and note this is not a forced distribution): 15% Excelling beyond objectives 65% Performing at objectives 15% Developing to meet performance objectives (but new to the objectives) 5% Struggling to meet objectives Page 6 of 13
STEP 2: Enter the Merit Increase Enter the Merit Increase On the Merit tab, based on the Annual Performance Rating, a Target Range for Merit will populate. This is meant to provide managers with guidance in distributing their merit pool. Managers can go above/below it as long as they stay within overall budget but should also focus on identifying the outliers and rewarding accordingly. For assistance with How to Make a Merit Recommendation, please see the Appendix at the end of this guide. Enter either a Merit Increase % or Merit Amount. (The other field will auto calculate.) New Pay with Merit will round to the nearest dollar for salaried positions and to the nearest penny for hourly positions. Because this is a rounded field, you may see the Merit Increase % change slightly to accommodate the rounding rule. If an associate is at the top of the salary range or if an increase would put the salary over the maximum of the salary range, a Lump Sum is recommended versus a merit increase. To enter a lump sum amount: Scroll to the right on the merit tab and either enter a Lump Sum % or Lump Sum Amount. (The other field will auto calculate.) Validations When planning, one of the following messages may appear in the Validations column. From the grid, if you click on the blue number next to the validation indicator, you will be able to read a message explaining the error. Annual Performance Rating Required o CRITICAL: You won t be able to submit the plan without the rating. Proposed Pay Over Tercile Max o WARNING: You can submit the plan, but a comment is required. Struggling Rating Not Eligible for Merit o WARNING: You can submit the plan, but a comment is required. When writing comments, remember they become part of the permanent record. Use good judgment and maintain professionalism when writing comments. Page 7 of 13
STEP 3: Submit Submit When planning is complete, click SUBMIT. Clicking submit forwards the information to the next step in the process (your manager). After submitting, you will no longer be able to make changes unless your manager sends it back to you. 1. If you have any comments for your manager, use the Comment field. Comments are not viewable by associates but are viewable to all higher level managers in the supervisory organization. 2. Your manager will receive an Inbox notification in Workday and an email will be sent to their Outlook email inbox. There is not a Save button because information is saved real-time in Workday as you enter it. If you do not click Submit, your plan will not be sent to the next step. To view merit recommendations after you have submitted the plan, use the reports on the Compensation Review dashboard (detailed instructions are in the next section of this user guide). Page 8 of 13
Compensation Review Dashboard: Worklets, Tasks, and Reporting New for this year is a Compensation Review dashboard on your Workday home page. Tools are designed to provide insight for you to manage differentiating pay. Parameters for Worklets, Tasks and Reports In Workday, prompts often appear prior to being able to run a worklet, task or report. When using the merit planning tools on the Compensation Review dashboard, here are some of the parameters you may be prompted to provide: 1. In the Compensation Review Process box, select the 2018 Merit Plan 2. In the Supervisory Organization field, enter the name of the org to select, which could be found by entering your own last name, or the last name of the Manager for the org in which you are searching. 3. Check the box to Include Subordinate Organizations, or uncheck it if you do not want all of the subordinate organizations included. 4. Click Ok. Reminder: in Workday, you can click on blue font to drill further into details. Accessing worklets (charts and graphs) When accessing worklets for the first time on the Compensation Review dashboard, you will need to choose the parameters for the worklet to pull. These parameters will remain intact in the future when you open the dashboard. If you would like to change them, follow the same steps. Click on the gear icon and select Edit Settings. Complete the Edit Worklet Settings box, following the instructions above about parameters. Merit Statements Merit Statements will be available for managers to generate to review with associates by January 3 rd, and will be released to associates via Workday on January 19 th. Job Aids with instructions for generation and printing are available on Workday HQ. Page 9 of 13
Worklet: Average Merit Increase by Performance Provides a summary of average merit increase by Annual Performance Rating and a summary of the Performance Distribution. Performance Differentiation. For larger departments/groups, we are suggesting the following performance distribution in order to enable better pay differentiation: 15% Excelling beyond objectives 65% Performing at objectives 15% Developing to meet performance objectives (but new to the objectives) 5% Struggling to meet objectives Note: The performance distribution guideline is a recommendation and is not intended to be a forced distribution. Pay Differentiation. Ensure there is substantial merit differentiation between Excelling and Performing categories. Is Excelling receiving substantially higher increases than Performing? How does this compare to the recommended distribution? Page 10 of 13
Worklet: Pay Differentiation Factor This will show how much merit increases for Excelling and Performing categories are differentiated or how much more you re rewarding the Excelling than the Performing category. A 1.0 result means no differentiation has occurred between those who are Excelling and those who are Performing. A result above 1.0 means some differentiation is occurring. Task: Search The task is a shortcut to the search function. Click on this task to locate the merit grid for specific associates, managers, etc. Fill in the Prompts select the open Merit Plan, and enter the name of the Manager for the Org you wish to find in either the Planner or the Top Level Organization box. Page 11 of 13
Report Tools The icons below may appear on your report screen, and you can click them to make changes to how data is viewed, or to export the data. Not all icons are available on every report. 1. Export to Excel or Print PDF 2. Configure & View Chart Data change to columns, bar, graph, pie, etc. 3. Filter Grid Data narrow down the data set or set preferences 4. View/Edit Grid Preferences select the columns you want to view 5. Expand/Collapse Chart toggle adding or removing chart view 6. Toggle Full screen Viewing increases report on your screen Report: Merit Spend Summary Summary by supervisory organization showing merit spend ($) and merit pool ($), merit pool % spent, and status. Quickly identifies supervisory organizations that are over budget and also where supervisory organizations are in the planning process. Report: Employee Detailed Merit Analysis Detailed report by associate that can be run by supervisory organization. Provides detailed information for grade, title, merit increases, tercile, rating, etc. Can be sorted by any field on the screen to help identify yellow warnings and/or red flags. Recommended Steps to Use this report: 1. Sort By Annual Performance Rating a. Make sure the Excelling performers are receiving substantially more than the Performing category b. Associates with an Annual Performance Rating of Struggling are not eligible for a merit increase 2. Sort by Percentage Increase a. Make sure the larger increases are targeted at Excelling category 3. Sort by warning to help identify exceptions 4. Review all comments provided by Planners for clarity and appropriateness Report: Merit Audit Report Provides an audit trail of who made entries and/or changes and when. Page 12 of 13
Appendix: HOW TO MAKE A MERIT RECOMMENDATION Relationship between performance reviews and merit planning Performance reviews and merit planning are two separate and related processes. Performance review Intended to review past performance and align on upcoming priorities on a quarterly basis. To select a performance rating, a manager considers accomplishments/results (the what ) and behaviors (the how ). Merit planning Intended to reward performance on an annual basis. To make a merit recommendation, a manager considers performance reviews and a variety of other data points that are relevant to each job (e.g. KPIs, production targets). Note: Sales, anniversary, and contract-based associates are exempt from the annual merit planning cycle in November. What is a merit recommendation? A merit recommendation is a salary increase based on overall performance for the year. How do I make a merit recommendation? Each manager follows a 2-step process to make a merit recommendation: 1. Select an Annual Performance Rating (see tips in the next section). 2. Based on the Annual Performance Rating, Workday generates a suggested target merit range from which a manager enters a merit increase recommendation. Tips for selecting an Annual Performance Rating Managers are empowered with the discretion to determine Annual Performance Ratings for their associates. Along with the discretion, is the responsibility to make those decisions using critical reflection. Below are a few tips to help make decisions: 3. Frequency: If an associate receives the same rating 3 or 4 times during the year, typically, that is also their Annual Performance Rating. Following this tip will likely cover most of your associates. 4. Identify outliers: We anticipate the majority of associates will fall in the Performing category. For associates that have less consistent quarterly ratings, remember the purpose of ratings is to identify outliers higher and lower performers so that they can be financially rewarded accordingly. Therefore, determine if an associate, in general for the year, matches the Excelling or Struggling definitions. Please recall the overall guidance Trustmark suggests for larger departments/groups (and note this is not a forced distribution): 15% Excelling beyond objectives 65% Performing at objectives 15% Developing to meet performance objectives (but new to the objectives) 5% Struggling to meet objectives 5. Performance trend: If an associate is on the edge between two different ratings, consider recent trends in performance. For example, if the associate is between Performing and Struggling and the most recent quarter received a Struggling rating, then typically the associate would receive a Struggling rating for the Annual Performance Rating. 6. Manager support: Finally, if you remain undecided, consult your manager to help you think through your decision. For the transition year in 2017, managers will determine an Annual Performance Rating in November based on the Q3 performance review, mid-year reviews from the old performance review process, and other job-relevant data (e.g. KPIs, production targets). Page 13 of 13