Pay for performance is used when you want the employees to get compensation based on how the department has performed.
First you should go to Organization administration -> Departments -> Related forms -> Compensation.
There you can set up the compensation for the department. The award that the employees in the department gets depends on the field “Percent of target achieved field“.
Percent of target achieved field reflects Leverange in the variable compensation plans.
If you set 100 in percent of target achieved field the employees gets the amount set in the field “Payout at 100%”. If your employees excel and is over 100 %, then Talent will add the amount set in the “Per 1% over objective” field until you reach the field “Highest allowable payout”.
On the other hand, if the performance is less then 100 %, then Talent subtracts depending on the field “Per 1% under objective” field, until you reach the amount set in “Lowest allowable payout”