Employment Model - Part 2 Explained

This post is in continuation to my previous post on the Employment Model in Oracle HCM. You can find the previous post here.

As explained earlier, there are two types of employment model in Oracle HCM Cloud

• 2-Tier Model

• 3-Tier Model

The employment model can be set up at the enterprise level or at the Legal Employer level (this overrides the enterprise setup) by using the Manage Enterprise HCM Information and Manage Legal Entity HCM Information tasks in the Setup and Maintenance work area respectively.

Below is a detailed list of Employment models available in Oracle HCM:

• 2-Tier Single Assignment
• 2-Tier Single Assignment with Contract
• 2-Tier Multiple Assignments
• 2-Tier Multiple Contracts with Single Assignment
• 3-Tier Single Employment Terms - Single Assignment
• 3-Tier Single Employment Terms Multiple Assignment
• 3-Tier Multiple Employment Terms Single Assignment
• 3-Tier Multiple Employment Terms Multiple Assignments

Based on the number of assignmnets a worker can have in an organization you can chose from any of the above options. As explained in the previous post, employment terms is of great advantage if a worker can have similar assignments within a single work relationship.

The 2-Tier Multiple Contracts with Single Assignment is a feature added as part of the Oracle Global Human Resource R13 (updates 17B - 17D). This employment model allows to manage contracts for workers having mulitple assignments. Each assignment can be associated with its individual contract and it does not allow the same contract to be shared across multiple assignments.

The 2-Tier Multiple Contracts with Single Assignment  and the 2-Tier Single Assignment with Contract, lets the system capture the contract information along with the assignment for any work relationship. Including the contract information in the assignment is optional.

By default every enterprise uses the 2-Tier Single Assignment model. Whenever a work relationship is created with a legal employer one assignment gets created automatically. With 2-Tier Multiple Assignments, it allows you to add additional assignments later manually. 

Note: A person can have one or more work relationship with the enterprise

The 3-Tier Model is also similar to the 2-Tier model in terms of the Single/Mutliple assignments except that it has Employment terms in between the work relationship and the Assignment. The employment terms will contain the contract or the trems and conditions that govern one or more assignments.

The below diagram summarizes a 3-tier model with a worker having muliplte relatonship with an enterprise and  employment terms to govern one or more assignments.

The 3-Tier model provides the ability to control assignment attribute values and enforce consistency across multiple assignments within an employment term. This model also provides the ability to have multiple assignments governed under a single contract.

Each model has got its own advantages/disadvantages. It depends upon the clients operating model to chose the correct employment model, which is a fundamental decision. This decision must be made because it affects other related implementation decisions, including several HR processes and the end user experience. In addition, it may not be easy (and not possible in certain cases) to switch from one employment model to another after you deploy HCM.