compensation management
Pay Structures / Salary Structures
Introduction:
Pay StructuresWhat are Pay Structures or Salary Structures?
Pay structures, also known as salary structures, set out the different levels of pay for jobs, or groups of jobs, by reference to:
their relative internal value, as established by job evaluation external relativities, via market rate surveys where appropriate, negotiated rates for the job
What are the main characteristics of Pay Structures?
indicate rates of pay for different jobs provide scope for pay progression via performance, competence, contribution, skill or service contain pay ranges for jobs grouped into grades, individual jobs or job families.
Why do organisations need Pay structures?
establish a logically-designed framework within which equitable, fair and consistent reward policies can be implemented determine levels of pay for jobs and people basis for the effective management of relativities help monitor and control the implementation of pay practices communicate the pay opportunities available to employees.
The most important types of pay structure, or salary structure, are:
Types of pay structures
There has been a growing awareness in recent decades of the benefits of ‘single-status’ arrangements – that is, a single, integrated pay and benefits system covering the entire workforce of an organisation - in place of older systems that might have operate separate structures for, say, manual and white-collar staff. This has tended to reduce overall numbers of pay structures. It is however typical today to have a separate pay structure or arrangements for senior executives, often determined by a special remuneration committee. For more on directors’ reward, see our guidance and listen to our podcast. Set against the reduction in the average number of pay structures, there has conversely been a tendency towards growing complexity of pay structures in recent years. This may in part be explained by structural changes
Introduction:
Pay StructuresWhat are Pay Structures or Salary Structures?
Pay structures, also known as salary structures, set out the different levels of pay for jobs, or groups of jobs, by reference to:
their relative internal value, as established by job evaluation external relativities, via market rate surveys where appropriate, negotiated rates for the job
What are the main characteristics of Pay Structures?
indicate rates of pay for different jobs provide scope for pay progression via performance, competence, contribution, skill or service contain pay ranges for jobs grouped into grades, individual jobs or job families.
Why do organisations need Pay structures?
establish a logically-designed framework within which equitable, fair and consistent reward policies can be implemented determine levels of pay for jobs and people basis for the effective management of relativities help monitor and control the implementation of pay practices communicate the pay opportunities available to employees.
The most important types of pay structure, or salary structure, are:
Types of pay structures
There has been a growing awareness in recent decades of the benefits of ‘single-status’ arrangements – that is, a single, integrated pay and benefits system covering the entire workforce of an organisation - in place of older systems that might have operate separate structures for, say, manual and white-collar staff. This has tended to reduce overall numbers of pay structures. It is however typical today to have a separate pay structure or arrangements for senior executives, often determined by a special remuneration committee. For more on directors’ reward, see our guidance and listen to our podcast. Set against the reduction in the average number of pay structures, there has conversely been a tendency towards growing complexity of pay structures in recent years. This may in part be explained by structural changes