employee grade and salary structure

The Staff Salary Structure reflects these levels and their associated competitive market ranges. When I started in the residential solar business eight years ago, we were creating whole piles of jobs that had never existed before. Because in my experience it is so much easier to have job-based ranges conversations with them than grade-based. Many employers use an employee grade-level system that helps differentiate between positions and standardize compensation across equivalent skill sets and responsibilities. When should companies consider adding structure to their compensation plans? She’s also founded two companies of her own and held a variety of C-level positions over the course of the last 20 years. And, each pay grade has a wider salary range than traditional structures. When would I say that you might need to migrate from job-based ranges to grade-based structure? I mean, every one of those informs the other.

Research has shown that a worker’s satisfaction with their pay remains a large factor in their desire to stay or leave a company. We invited Susan Hollingshead — an experienced HR leader and PayScale customer — to give organizations some guidance on how to determine the right salary structure for their business. Align Your Compensation Strategy with Business Priorities. And so, you now have a really dynamic system where one aspect supports another. Your salary structure (or salary range structure) is a foundational piece of your compensation plan. I’m looking at which of my jobs are experiencing significant adjustment up or down, but my jobs are seldom down anymore in their ranges in the marketplace. Everyone kind of knows everything that’s going on in the company, what jobs are available and how they should be being paid (whether that’s market based or not). And we can tie that to the kinds of career development opportunities that we offer people based on which jobs are the most mission-critical to us, which are moving faster in the marketplace, which are the hardest to retain, and to succession planning. Secondly, they have to allow themselves enough time to move through the organization, decide if they’re going to do one part of the organization at a time or the whole organization. How often should you evaluate your mission-critical jobs? Grade-based conversations just become so contentious. We can also help with the communication of your new framework so that it is understood by employees and managers, making sure your hard work lands well and sticks around.

So to the extent that you’re creating new jobs, job-based structures become even more important because you’ve really got to parse out the individual skills and the value of those skills to create realistic salary ranges. And it’s enabled us to create a level of transparency that was somewhat difficult to do before that. Here are examples of employee grade-level descriptions from individual employees up to the Vice President level: Individuals at this level usually follow standard work routines. In that case, it’s going to be some months or quarters of effort before they get that whole system set up and put it in place. In an employee-driven market as we see today where unemployment is so very low, no company can afford to have a sudden and unexpected migration of its most critical employees because they failed to properly adjust their salary ranges. While grade-based structures have been common in the past, especially for large companies, we’ve seen organizations — even quite large ones — shift to a job-based pay structure for a variety of reasons.

At one point, I actually forbid our organization, not this one but the past one from putting years’ of experience on job requisitions, not because I didn’t think it had a certain validity, but because I was trying to force the issue within the organization to focus on skills and to focus on how we were going to interview and select for competency and skill sets. I mean, people increasingly get that they have a set of skills to sell in the marketplace and that it has a market value and they understand those kinds of questions or those kinds of discussions. They'd then apply the compensation matrix and document low, mid, and high ranges for compensation. And I think that one of the most fun things that’s come out of job-based ranges is the ability to have candid conversations with employees about their skill development. So to the extent that you’re creating new jobs, job-based structures become even more important because you’ve really got to parse out the individual skills and the value of those skills to create realistic salary ranges. Level A: Entry Level Individual Contributor, Level B: Experienced Individual Contributors, Level C: Managers and Senior Technical Professionals and Individual Contributors, The Role of the Human Resources Department.

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