10 Reasons why your organisation needs a pay structure

A pay structure is a series of grades showing each grade’s minimum, midpoint, and maximum salary. What anchors the pay structure is that jobs have been adequately evaluated and put in grades. The grades show the relative value of jobs to the organisation.  A pay structure can be developed based results of a job evaluation. Others who may not have a job evaluation system in place prefer to use market pricing. In market pricing, jobs are ranked based on the market salary. This could be the median or the 75th percentile.  The two approached all can lead to the development of a pay structure. The critical question for most people is why would their organisation need a pay structure.

  1. Internal equity – A pay structure brings internal equity; when employees feel what they are paid relative to other people in the organisation is justified by variation in job content and performance. When jobs are put in a grading structure, and a pay structure is developed based on a grading structure, most employees accept salary differentiation supported by a credible pay structure. If your organisation does not have a pay structure, people may start by not complaining. As the organisation employs more people, you will begin to hear complaints around salaries; specifically, people start questioning why John earns more than Grace when they are all doing similar jobs. The only cure is to commission a job evaluation and a pay structure project. You can not explain equity issues away, and they need a pay structure that is properly run.
  2. External equity is your employees’ feeling about how well they are paid compared to similar positions outside your organisation. The reference point is usually the market. When your employees start raising issues indicating that they are underpaid compared to the market, you must remember to refer to external equity. The only solution is to develop a pay structure anchored on a chosen market position for the company. This could be the median or the 75th percentile, or even 90th percentiles subject to affordability and sustainability.
  3. The pay structure allows you to have a procedure for paying staff based on performance and skills scarcity. Although not recommended, other organisations factor in the experience and education level of the individual employees. The guiding principle is that new employees and less experienced employees are paid close to the minimum of their grades. It would help if you targeted to deliver your top performers around the midpoint. Only exceptional talent should be paid close to the
  4. Process equity – this deals with how employees perceive fairness or equity in the administration of the salary and benefit system. Process equity is strongly influenced by the system’s openness, communication of the system to employees, and participation in the system’s design.
  5. Pay & Grades – the relationship between pay and grades can only be brought to life through a pay structure. If that connection is not established, your organisation will likely have frequent pay complaints from employees.
  6. Benefits Structure – The pay structure allows you to align your benefits with the grades and pay structure. For example, you may find that roles in a particular grade are entitled to certain benefits that vary from the other grades. It is always advisable to have both a pay structure and benefits structure.
  7. Pay range – the pay range in the difference between the maximum and minimum salary in a grade. It helps you to vary people’s salaries based on performance. A pay structure has ranges because there is an acknowledgment that while a grade groups jobs of equal value, the individuals occupying those roles do not bring equal value. The range then allows you to differentiate what people will earn based on performance. Each grade provides for a range of pay. Within a pay grade range, there is a minimum, median, and maximum pay. The preferred range in the current environment is from 20 to 60 percent.
  8. Staff turnover – With a haphazard salary administration system, you will likely experience significant staff turnover. It is also likely that you will find it hard to retain competent staff. A good pay structure that is well administered sends a strong message to your employees and potential employees that you are organised.
  9. Salary Progression – The percentage change in the median value (mid-point) from one adjacent pay grade to the next. It is important to note that the progression affects the size of the entire organisation’s wage bill; the smaller the progression, the smaller the size of the wage bill, and the larger the progression, the larger the size of the wage bill. Progressions tend to vary from 10 to 40 percent. It is also important to mention that lower differences are normally found in low grades with unskilled, semi-skilled, and clerical workers.
  10. Remuneration Policy – The pay structure helps you to manage a clean remuneration system. For your pay structure to have a longer life span, you need to support it with a remuneration policy. The remuneration policy will spell out how the pay structure will be adjusted to consider changes in the market, such as cost of living and general market salary movements.

Suppose you do not have a pay structure, you probably experiencing several HR challenges related to staff retention and attraction.  If you are in this situation, the best option is to have a job evaluation done and a proper pay structure designed for your organisation.

Memory Nguwi is an Occupational Psychologist, Data Scientist, Speaker, & Managing Consultant- Industrial Psychology Consultants (Pvt) Ltd, a management and human resources consulting firm. https://www.thehumancapitalhub.com  email: mnguwi@ipcconsultants.com.

284 Responses

  1. Vumbtu says:

    buy ceftin 500mg online cheap – oral cefuroxime 250mg oral tadalafil 20mg

  2. Kucxcc says:

    ampicillin uk – cialis 5mg cheap buy tadalafil 5mg pills

  3. Ppnjjb says:

    ampicillin 250mg price – cialis order tadalafil 5mg without prescription

  4. 金万达 says:

    Today a reader,tomorrow a leader!

  5. Zqjztc says:

    purchase amoxil – amoxicillin sale levitra generic

  6. Adohtz says:

    buy amoxicillin 1000mg pill – vardenafil 10mg pill order levitra for sale

  7. Teqzwk says:

    ivermectin 3mg online – buy levitra 20mg brand levitra

  8. Xgzpcq says:

    stromectol 3mg tablets – ivermectin 3mg oral vardenafil sale

  9. webonline says:

    "10 Reasons why your organisation needs a pay structure" checkout my nice website https://www.webonline.fr/

  10. Nkglam says:

    buy doxycycline 200mg pill – cialis tablets order cialis online

  11. Cgsmqn says:

    buy doxycycline online cheap – clomid 50mg ca buy cialis 40mg pills

  12. Xtucdg says:

    tadalafil 5mg cheap – tadalafil 5mg uk buy provigil 100mg for sale

  13. Irtvid says:

    buy cialis 10mg pills – order provigil 100mg generic modafinil drug

  14. Zbnwei says:

    deltasone 40mg us – buy accutane 10mg sale isotretinoin 10mg tablet

  15. Vlvprr says:

    buy prednisone 40mg – medicine for impotence buy generic accutane 40mg

  16. Kylwwy says:

    buy amoxil 1000mg online cheap – buy azithromycin online sildenafil 200mg price

  17. 菜来了 says:

    So you are a man or woman?

  18. Xnlxlw says:

    oral amoxicillin 500mg – sildenafil 25mg sildenafil mail order

  19. Foypzj says:

    prednisolone tablets – prednisolone 20mg drug purchase sildenafil pills

  20. Yjhfrl says:

    order prednisolone 20mg – order prednisolone online cheap buy generic viagra 50mg

  21. Qryxlc says:

    lasix tablet – ivermectin lotion ivermectin 6mg online

  22. Qmylcc says:

    lasix tablet – buy furosemide generic ivermectin generic name

  23. Zzevwc says:

    hydroxychloroquine 400mg oral – buy baricitinib pill order baricitinib 4mg generic

  24. Fhkmqu says:

    oral hydroxychloroquine 200mg – order chloroquine 250mg pill order baricitinib 4mg pills

  25. Obaznn says:

    glucophage 1000mg cost – lipitor 20mg cheap order amlodipine 10mg pills

  26. Vkwtcr says:

    buy metformin 500mg sale – norvasc brand norvasc for sale

  27. Ldaffb says:

    lisinopril 2.5mg cost – order tenormin 50mg online cheap tenormin 50mg tablet

  28. Wnogjv says:

    vardenafil drug – buy clomid 100mg generic order clomid 50mg sale

  29. Bgnwcw says:

    levitra 20mg cheap – methylprednisolone oral clomiphene 100mg ca

  30. Qtojvd says:

    ventolin usa – free slots games buy dapoxetine 30mg

  31. perfect

    thank you for a very good article

  32. Slbwdm says:

    purchase albuterol pills – best casino games dapoxetine brand

  33. Lgrpnf says:

    synthroid 75mcg drug – oral clarinex 5mg buy plaquenil 200mg sale

  34. Davidbef says:

    how can i order prescription drugs without a doctor buy prescription drugs without doctor

  35. Bradleylox says:

    online prescription for ed meds without doctor prescription

  36. Russellgus says:

    https://drwithoutdoctorprescription.com/# comfortis for dogs without vet prescription

  37. Cdhmqt says:

    synthroid 100mcg us – levothyroxine online plaquenil order

  38. Xivlzf says:

    order tadalafil for sale – cialis online buy buy generic sildenafil 50mg

  39. Xduizx says:

    buy cialis 40mg online cheap – order cialis 20mg pills order viagra 100mg

  40. Qacvqi says:

    purchase deltasone without prescription – buy isotretinoin buy amoxil 250mg pills

  41. 就爱要 says:

    Where there is a will, there is a way.

  42. Zpjgjo says:

    cheap prednisone – buy generic accutane amoxil 250mg us

  43. Michaeldix says:

    sildenafil over the counter viagra

  44. Jlgmfj says:

    diltiazem for sale online – order zithromax 250mg online order neurontin 100mg for sale

  45. Uooeia says:

    diltiazem generic – purchase zithromax generic buy gabapentin 800mg online

  46. Vaqzie says:

    order lasix online – zyloprim us buy doxycycline 200mg pill

  47. Michaeldix says:

    viagra coupons 75% off buy generic 100mg viagra online

  48. viagra over the counter walmart п»їviagra pills

  49. Jgckrx says:

    order furosemide 40mg online cheap – purchase acyclovir pill oral doxycycline 100mg

  50. Fuajqe says:

    cenforce pill – rosuvastatin over the counter motilium canada

  51. Michaeldix says:

    viagra shop buy viagra online canada

  52. Avgggb says:

    purchase cenforce online – rosuvastatin cost motilium ca

  53. Kamwih says:

    sildenafil viagra – sildenafil pills 25mg cialis 40mg without prescription

  54. Michaeldix says:

    sildenafil over the counter viagra

  55. Hnzzpx says:

    sildenafil 150mg us – sildenafil 100mg pills for men tadalafil medication

  56. Raymondwak says:

    best clomid brand in india clomid online canada

  57. Qfszaj says:

    buy provigil online – order modafinil sale order generic rhinocort

  58. This Domain Is Good!

  59. 最会淘 says:


  60. Kpzezr says:

    buy provigil for sale – buy provigil 200mg online buy rhinocort sale

  61. StephenDob says:

    https://clomidforsale.life/# can i buy clomid over the counter uk

  62. Shelbyquece says:

    prednisone 50 mg tablet cost 100 mg prednisone daily

  63. Ucrjbo says:

    accutane over the counter – amoxil 500mg pill buy tetracycline 250mg without prescription

  64. RobertBloto says:

    how much is amoxicillin amoxicillin no prescipion

  65. Raymondwak says:

    can i buy clomid over the counter buy clomid over the counter

  66. StephenDob says:

    https://prednisoneforsale.store/# prednisone 500 mg tablet

  67. Raymondwak says:

    https://buylasix.icu/# lasix generic name

  68. Sdalbk says:

    order isotretinoin 20mg generic – order accutane 10mg pills buy tetracycline 250mg generic

  69. Hmajzg says:

    cyclobenzaprine oral – purchase cyclobenzaprine sale propranolol generic

  70. Mzgrpz says:

    purchase flexeril for sale – purchase colchicine buy inderal online cheap

  71. Edwardtic says:

    tadalafil tablets price in india tadalafil tablets 20 mg online

  72. Raymondwak says:

    https://buytadalafil.men/# generic tadalafil medication

  73. Qpwjrh says:

    buy clopidogrel 150mg pills – methotrexate over the counter buy reglan 10mg generic

  74. 择偶网 says:

    Very Good!不错呀!

  75. Raymondwak says:

    https://buynolvadex.store/# tamoxifen rash pictures

  76. WilliamRix says:

    lasix for sale lasix 20 mg

  77. Anthonydiz says:

    https://buynolvadex.store/# benefits of tamoxifen

  78. Edwardtic says:

    lipitor generic price canada buy lipitor

  79. Dphyjy says:

    cozaar 50mg brand – order nexium 20mg without prescription generic promethazine

  80. Robertnic says:

    https://cipro.best/# ciprofloxacin 500 mg tablet price

  81. Lpuoxf says:

    order cozaar 25mg generic – purchase phenergan generic promethazine without prescription

  82. Robertnic says:

    https://gabapentin.icu/# buy neurontin online no prescription

  83. Jefferyzes says:

    can i buy neurontin over the counter medicine neurontin

  84. Gxdaas says:

    levofloxacin 500mg cheap – oral tadalafil cheap cialis for sale

  85. What i don’t understood is actually how you’re no longer actually
    much more neatly-appreciated than you may be right now.
    You’re very intelligent. You already know therefore considerably relating to this topic, produced me
    personally imagine it from so many various angles. Its like women and men don’t seem to be interested except it is one thing to accomplish with Woman gaga!
    Your own stuffs excellent. All the time handle it up!
    help refuges

  86. Georgecot says:

    https://cipro.best/# buy ciprofloxacin

  87. Jefferyzes says:

    how to get prescription drugs without doctor cvs prescription prices without insurance

  88. Wutuza says:

    purchase levofloxacin – order levofloxacin pills cialis coupon walmart

  89. Tllcbi says:

    buy cialis 10mg – buy generic celecoxib 100mg buy flomax 0.2mg generic

  90. Jefferyzes says:

    ed pills that work best male ed pills

  91. Meifcw says:

    cialis 40mg pill – meloxicam over the counter tamsulosin 0.4mg usa

  92. wonderful post, very informative. I’m wondering why the other experts of this sector do not realize this. You must proceed your writing. I’m sure, you’ve a huge readers’ base already!

  93. IsiahPat says:

    ciprofloxacin order online cipro pharmacy

  94. Jefferyzes says:

    neurontin 800mg buy brand neurontin

  95. Georgecot says:

    https://diflucan.icu/# diflucan 15 mg

  96. Okgnya says:

    order zofran pills – purchase zofran for sale valtrex online

  97. IsiahPat says:

    buy cipro online canada buy ciprofloxacin over the counter

Leave a Reply

Your email address will not be published.