Positions and workforce
Position adjustment examples
Work through examples of percentages, fixed amounts, pay rate bases, conversion, limits, stacking order, and partial-year effects.
Updated August 2, 2026
Overview
Position adjustments change FTE, pay rate, or annual 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 pay differential should not sometimes be entered as a pay 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 View sensitive workforce data when exact pay or cost details are included |
| Configure adjustment choices | Manage position setup |
| Add an adjustment to a position | Manage positions, or authorized request submission for that position |
| 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 pay cost is calculated | Temporary staffing increase or planned FTE reduction |
| Pay rate | The Hourly or Annual Base pay rate before it is annualized and multiplied by FTE | Shift differential or market adjustment |
| Annual cost | Annualized Position cost after FTE applies | Benefit load, fixed annual allowance, or annual overhead |
Within each group, adjustments use four phases: fixed amounts before percentages, non-compounding percentages, compounding percentages, and fixed amounts after percentages. Your organization’s order controls adjustments within the same exact type.
Non-compounding and compounding percentages
Non-compounding percentages use the same starting basis. Compounding percentages use the amount produced by the previous adjustment.
Example with two non-compounding FTE percentages:
Example with two compounding FTE percentages:
Use compound adjustments only when the policy requires each percentage to build on prior adjustments.
Fixed amounts before and after percentages
A fixed amount before percentages becomes part of the basis used by later percentages. A fixed amount after percentages is added only after the non-compounding and compounding percentage calculations finish.
FTE phase example
- Starting FTE:
1.0000 - Fixed FTE before percentages:
0.1000 - Compounding FTE percentage:
10% - Fixed FTE after percentages:
0.2000
Pay rate phase example
- Starting pay rate:
$20.0000/hour - Fixed rate before percentages:
$2.0000/hour - Compounding rate percentage:
10% - Fixed rate after percentages:
$3.0000/hour
At 1.0000 FTE and 2,080.00 annual hours, the Adjusted pay rate of $27.2000/hour becomes $56,576.00 of annualized Position cost.
Annual cost phase example
- Starting annualized pay cost:
$41,600.00 - Fixed annual amount before percentages:
$1,000.00 - Compounding annual percentage:
10% - Fixed annual amount after percentages:
$2,000.00
The after-percentage amount is not part of the 10% basis in any of these examples. Non-compounding percentages follow the same before-versus-after boundary; they differ only by continuing to use the starting percentage basis instead of the running total.
FTE amount example
- Starting FTE:
0.7500 - FTE amount adjustment:
0.2500
The adjusted FTE is then used for annual position hours, position cost, headcount review, and approval impact.
Pay rate examples
Fixed pay differential
- Starting pay rate:
$25.0000/hour - Pay rate adjustment:
$2.0000/hour - Pay rate basis: Hourly
- Cross-basis behavior: Same basis only
- FTE:
1.0000 - Annual hours per FTE:
2,080
Pay rate percentage
- Starting pay rate:
$30.00 - Pay rate adjustment:
10%
At 1.0000 FTE and 2,080.00 annual hours, the adjusted annualized Position cost is $68,640.00.
Pay rate basis and conversion
Fixed pay rate adjustments have an Hourly or Annual basis. Same basis only requires the adjustment basis to match the Position Base pay rate. Convert allows one value to be Hourly and the other Annual, using annual hours for the conversion. Percentage adjustments need no basis unless a maximum basis or maximum impact gives the limit its own basis.
Annual base with an Hourly fixed adjustment
- Position Base pay rate:
$90,000.00/year - Fixed pay rate adjustment:
$2.0000/hour - Cross-basis behavior: Convert
- Annual hours per FTE:
2,080.00 - FTE:
0.7500
With Same basis only, the Hourly component cannot be applied to this Annual Base pay rate. FTE Tree identifies the mismatch instead of silently skipping or converting it.
Annual pay rate amount versus annual cost amount
A $5,000.00/year fixed pay rate adjustment is a full-time pay component, so FTE applies to it. At 0.7500 FTE, it contributes $3,750.00 to Position cost. A $5,000.00 annual cost adjustment occurs after FTE and contributes the full $5,000.00. Choose the group that matches the policy rather than treating those amounts as interchangeable.
Annual cost examples
Benefit percentage
- Annualized pay cost before annual adjustments:
$56,160.00 - Annual cost adjustment:
25%
Fixed annual amount
- Annualized pay cost before annual adjustments:
$52,000.00 - Fixed annual adjustment:
$3,000.00
Maximum basis
A maximum basis limits how much of the starting value is used for a percentage adjustment.
- Annualized pay cost:
$80,000.00 - Annual adjustment:
5% - Maximum basis:
$50,000.00
Without the maximum basis, the adjustment would be $4,000.00.
Maximum impact
A maximum impact limits the adjustment itself.
- Annualized pay cost:
$75,000.00 - Annual adjustment:
10% - Maximum impact:
$5,000.00
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 pay cost:
$50,000.00 - Annual adjustment:
-10% - Maximum impact:
$3,000.00
The limit keeps the size of the reduction within $3,000.00.
When a reduction would go below zero
FTE Tree waits until all adjustments in the same group are complete before applying the minimum value of zero. This allows a later adjustment to recover an earlier negative amount.
For example, start with 1.0000 FTE, apply -2.0000 before percentages, and then apply +2.0000 after percentages. The running FTE is -1.0000 after the first line but finishes at 1.0000. The completed result is positive, so no floor or warning is needed.
If the only adjustment is -2.0000, the completed value would be -1.0000. FTE Tree instead shows:
- Adjusted FTE:
0.0000 - A calculation line showing the FTE minimum of zero
- A warning that adjustments made the calculated FTE negative
The same completed-result rule applies separately to adjusted pay rate and annual cost. If a group finishes at exactly zero, zero is used without a floor warning.
Review an adjusted position
Before using an adjustment broadly, apply it to a sample position and confirm:
- The adjustment changes FTE, pay 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.