Overview

Position adjustments change FTE, wage rate, or annualized cost. This article shows how the adjustment types differ and provides worked examples. For instructions on creating adjustment choices and controlling where they can be selected, see Position adjustments.

Use the same adjustment type for the same business purpose across the organization. A wage differential should not sometimes be entered as a wage-rate adjustment and elsewhere as an annual adjustment unless the underlying policy is genuinely different.

Access needed

Activity Access needed
View adjustments on a position View positions for the relevant department and any sensitive wage access needed for cost details
Configure adjustment choices Manage position adjustments
Add an adjustment to a position Update positions or the relevant request access
Access setup See Permissions and roles.

Where each adjustment applies

Adjustments are grouped by the value they change.

Adjustment group Changes Common examples
FTE Position FTE before wage cost is calculated Temporary staffing increase or planned FTE reduction
Wage rate Hourly or annual base rate before it is multiplied by FTE and annual hours Shift differential or market adjustment
Annual cost Completed annualized wage cost Benefit load, fixed annual allowance, or annual overhead

Within each group, adjustments follow the order set by your organization. Fixed amounts and simple percentages add to the starting value. Compound percentages build on the running total after earlier adjustments.

Simple and compound percentages

Simple percentages use the same starting amount. Compound percentages use the amount produced by the previous adjustment.

Example with two simple FTE percentages:

Worked calculation
Starting FTE
1.0000
10% adjustment
10% × 1.0000 = 0.1000
5% adjustment
5% × 1.0000 = 0.0500
Adjusted FTE
1.0000 + 0.1000 + 0.0500 = 1.1500

Example with two compound FTE percentages:

Worked calculation
Starting FTE
1.0000
After 10%
1.0000 + (10% × 1.0000) = 1.1000
5% adjustment
5% × 1.1000 = 0.0550
Adjusted FTE
1.1000 + 0.0550 = 1.1550

Use compound adjustments only when the policy requires each percentage to build on prior adjustments.

FTE amount example

  • Starting FTE: 0.7500
  • FTE amount adjustment: 0.2500
Worked calculation
Adjusted FTE
0.7500 + 0.2500 = 1.0000

The adjusted FTE is then used for annual position hours, position cost, headcount review, and approval impact.

Wage-rate examples

Fixed wage differential

  • Starting wage rate: $25.00
  • Wage-rate adjustment: $2.00
  • FTE: 1.0000
  • Annual hours per FTE: 2,080
Worked calculation
Adjusted wage rate
$25.00 + $2.00 = $27.00
Annualized cost
1.0000 FTE × 2,080 hours × $27.00 = $56,160.00

Wage-rate percentage

  • Starting wage rate: $30.00
  • Wage-rate adjustment: 10%
Worked calculation
Wage adjustment
$30.00 × 10% = $3.00
Adjusted wage rate
$30.00 + $3.00 = $33.00

At 1.0000 FTE and 2,080 annual hours, the adjusted annualized cost is $68,640.00.

Annual cost examples

Benefit percentage

  • Annualized wage cost before annual adjustments: $56,160.00
  • Annual cost adjustment: 25%
Worked calculation
Benefit adjustment
$56,160.00 × 25% = $14,040.00
Annualized cost
$56,160.00 + $14,040.00 = $70,200.00

Fixed annual amount

  • Annualized wage cost before annual adjustments: $52,000.00
  • Fixed annual adjustment: $3,000.00
Worked calculation
Annualized cost
$52,000.00 + $3,000.00 = $55,000.00

Maximum basis

A maximum basis limits how much of the starting value is used for a percentage adjustment.

  • Annualized wage cost: $80,000.00
  • Annual adjustment: 5%
  • Maximum basis: $50,000.00
Worked calculation
Limited adjustment
$50,000.00 maximum basis × 5% = $2,500.00
Annualized cost
$80,000.00 + $2,500.00 = $82,500.00

Without the maximum basis, the adjustment would be $4,000.00.

Maximum impact

A maximum impact limits the adjustment itself.

  • Annualized wage cost: $75,000.00
  • Annual adjustment: 10%
  • Maximum impact: $5,000.00
Worked calculation
Unrestricted adjustment
$75,000.00 × 10% = $7,500.00
Limited adjustment
Maximum impact = $5,000.00
Annualized cost
$75,000.00 + $5,000.00 = $80,000.00

If the same adjustment applies to $40,000.00, the result is $4,000.00, so the maximum does not change it.

Negative adjustments and limits

Maximum basis and maximum impact also apply to negative percentages.

  • Annualized wage cost: $50,000.00
  • Annual adjustment: -10%
  • Maximum impact: $3,000.00
Worked calculation
Unrestricted adjustment
$50,000.00 × -10% = -$5,000.00
Limited adjustment
Maximum impact = -$3,000.00
Annualized cost
$50,000.00 - $3,000.00 = $47,000.00

The limit keeps the size of the reduction within $3,000.00.

Review an adjusted position

Before using an adjustment broadly, apply it to a sample position and confirm:

  • The adjustment changes FTE, wage rate, or annual cost as intended.
  • The adjustment order matches the organization's policy.
  • Simple or compound behavior matches the policy.
  • Maximum basis or maximum impact limits behave correctly for both increases and reductions.
  • The approved-versus-proposed impact is clear before a request is submitted.
  • Position and report totals agree for the same dates.

See Position costs and headcount for the complete position-cost example and Position costs in reports for date-range allocation.