What is graduated vesting in SAP PA-CM - Compensation Management?

SAP Term: graduated vesting

• Component: PA-CM

• Component Name: Compensation Management

• Description: A form of vesting that allows employees to buy their stock gradually For example, 20% of the granted options in year 1, 40% in year 2, and the final 40% in year 3..

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• Key Concepts: 
  Graduated vesting is a feature of SAP's Compensation Management (PA-CM) module that allows employers to set up a vesting schedule for employee compensation. This means that employees will receive their compensation in increments over a period of time, rather than all at once. This can be used to incentivize employees to stay with the company for a longer period of time, as they will only receive their full compensation after a certain amount of time has passed. 
  
  How to use it: 
  To set up graduated vesting in SAP's Compensation Management module, employers must first define the vesting schedule. This includes setting the start date, end date, and any milestones that must be met in order for the employee to receive their full compensation. Once the vesting schedule is defined, employers can then assign it to individual employees or groups of employees. 
  
  Tips & Tricks: 
  When setting up graduated vesting in SAP's Compensation Management module, employers should consider how long they want employees to stay with the company before they receive their full compensation. This will help ensure that employees are incentivized to stay with the company for a longer period of time. 
  
  Related Information: 
  For more information on graduated vesting in SAP's Compensation Management module, please refer to the official SAP documentation here: https://help.sap.com/viewer/product/SAP_COMPENSATION_MANAGEMENT/latest/en-US