Bonus plans define how to calculate bonuses in your compensation cycles. Set up your bonus plan formula once in Pay Planner settings. It applies when you create a cycle that includes bonus as a pay type. You need Pay Planner admin access to do this.
Available bonus formulas
Pay Planner supports five standard bonus formulas. Each formula applies selected performance factors as multipliers against the budgeted bonus. Employees receive their full bonus only when all performance targets are met.
📌 Note: If your formula includes team performance, you must set team performance targets when you create a compensation cycle. Apply a single percentage across all teams, or adjust each team individually.
Budgeted bonus × company performance × individual performance.
Budgeted bonus × (company performance × company weight + individual performance × individual weight).
Budgeted bonus × (company performance × company weight + team performance × team weight) × individual performance.
Budgeted bonus × company performance × (team performance × team weight + individual performance × individual weight).
Budgeted bonus × company performance × team performance × individual performance.
Configure a bonus plan
To set up your bonus plan formula, follow the steps below. Changes to your bonus plan apply to new cycles only. Existing cycles are not affected.
From the dashboard menu, select Pay Planner.
Click Settings, then click Incentive plans.
Click the pencil icon on the Overall bonus calculation row.
Under Select formula, select the required formula.
If your formula includes weight factors, enter one value under Add weights.
📌 Note: The other value will fill automatically. Adding both weights together will total 100%.
Under Select the frequency of the bonus period, select the frequency.
To apply a prorated calculation, select the Employment start date checkbox.
📌 Note: This prorates the bonus based on eligible days worked. For more flexibility, for example to account for leave of absence, upload individual proration factors per employee when setting up a compensation cycle.
Click Save.
