!--a11y-->
Employer Matching 
Some employers match employee contributions to employee savings plans by making contributions dependent on the employee contribution. In this case, contributions are made in successive tiers, dependent on the percentage employee contribution. Each tier builds on the employee contribution threshold for the previous tier.
In Benefits Administration, however, contribution definitions are not dependent on one another; they are rules applied independently to the employee contribution to give a total contribution. In order to replicate the matching technique in the definition of employee contributions, you therefore need to translate your matching rules into multiple contribution rules that result in the same actual contribution calculated.

Employee matching rule:
- Tier 1: 100% of employee contribution for first 2% of employee contribution of salary
- Tier 2: 70% of employee contribution for next 1% of employee contribution of salary
- Tier 3: 20% of employee contribution for next 4% of employee contribution of salary
Employer contribution rule in SAP System:
- Step 1: 20% of employee contribution - limit 1.4% of salary
- Step 2: 50% of employee contribution - limit 1.5% of salary
- Step 3: 30% of employee contribution - limit 0.6% of salary
The maximum employer contribution for employer matching in the example above can be calculated as the area of each horizontal block on the following chart. In this example, matching for employee contribution amounts other than 2, 3, and 7 % can be calculated by intersecting the blocks horizontally at the appropriate point on the employee contribution axis.

Employer Matching
Since tiered contribution rules are not supported in the Benefits application, vertical blocks must be used to represent an identical employer contribution with the same total area, as shown in the following graphic. From these vertical blocks you can derive the corresponding rules that you need to set up in the SAP System.

Replication of Matching in Benefits
Thresholds, which are set in matching rules to define the maximum employee contribution to which an employer contribution rule applies, are not used in the SAP system. You therefore set limits instead to ensure that the maximum employee contribution is the same as in your matching rule. The calculation of this limit is the key step in the conversion of your rules.
You calculate new limits by multiplying the additional matching percentage covered by a step and the total employee contribution of salary for which the step applies. For example, the limit for Step 2 in the above graphic is 50% * 3% = 1.5% of salary
Using the rules from the above example, the following table shows how identical employer contributions can be calculated using the two different methods for an employee with a salary of $1,000.
EE contribution (% of salary) EE contribution |
2% $10 |
5% $50 |
10% $100 |
ER matching - tier 1 ER matching - tier 2 ER matching - tier 3 |
$10 - - |
$20 $7 $4 |
$20 $7 $8 |
ER matching - total |
$10 |
$31 |
$35 |
ER contribution - step 1 (limit 1.4% of salary) ER contribution - step 2 (limit 1.5% of salary) ER contribution - step 3 (limit 0.6% of salary) |
$2 $5 $3 |
$10 $15 $6 |
$14 $15 $6 |
ER contribution - total |
$10 |
$31 |
$35 |
Use the following formula based on the above example to help you translate your matching values into individual contribution rules for aggregation:
...
1. Step 1: ER contribution as a percentage of EE contribution
Determine the matching percentage of the last tier in the matching rule (20%)
2. Step 1: ER contribution limit as a percentage of salary
Multiply the sum of all matching limits (2% + 1% + 4% = 7%) with the matching percentage from the previous step: 7% * 20% = 1.4%
3. Step 2: ER contribution as a percentage of EE contribution
Subtract the matching percentage of the third tier from that of the second tier: 70% - 20% = 50%
4. Step 2: ER contribution limit as a percentage of salary
Multiply the sum of the matching limits of the first two tiers (2% + 1% = 3%) with the matching percentage from the previous step: 3% * 50% = 1.5%
5. Step 3: ER contribution as a percentage of EE contribution
Subtract the matching percentage of the second tier from that of the first tier: 100% - 70% = 30%
6. Step 3: ER contribution limit as a percentage of salary
Multiply the sum of the matching limits of the first tiers (2%) with the matching percentage from the previous step: 2% * 30% = 0.6%

You can translate your matching rule tiers into individual steps in any order without affecting the total employer contribution.