There have been cases where customers are confused that the departments were kind of created, but employees cannot be assigned to the departments.
Namely, it may be that the Locations were added instead, but the departments under them had not yet been added:
To solve this problem, open the desired Location from the "Edit" button at the end of the line
Then add a department under the Location from the "Add Department" button:
Now, under Locations, there are also Departments, and you can add employees to them