When I work with employers that have a few unique jobs, I don’t typically recommend a pay grade structure.
Why?
It is easy to market price each job and then calculate a competitive base pay range around the “market” number. That base pay range is then used in the pay decision making process for new hires and current employees performing the job.
Once the employer starts having more unique jobs AND those jobs can be grouped into categories based on standard factors, then I develop a pay grade structure to help simplify the base pay ranges that are used into one approach.
So, instead of each job having a unique market aligned base salary range, the market number is used to assign a pay grade to the job. Then the pay grade’s base salary range is used to make pay decisions and align an employee’s base pay rate to the job’s competitive market.
I’m curious.
How many unique jobs should an employer have before they implement a pay grade structure?
Please comment below.
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