Where pay arrangements are more complex, the structure itself may be adjusted each year. meet the business needs, including affordability. This involves weighing up the pros and cons of differing types of structure, including how closely they: An organisation should regularly review the way it structures pay and determines salary progression as economic, political, regulatory and technological contexts change.

HOWLETT, E. (2019) Most employees have never had their pay explained to them. meet the needs and aspirations of existing and potential employees, in a clear and non-discriminatory way.

Spot rates are often found among lower-skilled occupations where there’s a need for a simple ‘rate for the job’. This approach can help in facilitating higher rates for highly sought-after workers such as specialist IT staff.

Zones: Involves dividing each pay band into, say, three zones and specifying that individuals can only progress to the next zone for some exceptional reason - particularly useful for employers with a broadband system. Workspan. However, under equal pay legislation, red-circling is problematic as it tends to perpetuate existing pay inequalities. For instance, the pay increase may be linked to performance and position in the salary range with those below the median getting more than those above it. While modern pay structures aim to allow rewarding higher levels of performance or contribution, employers still need to control payroll costs.

support business strategy by encouraging and rewarding desired employee behaviours, maintain salary competitiveness while controlling payroll costs within set parameters (including affordability). By that time 64% of employers utilized market-based salary structures to administer pay for their employees. 38 percent. This factsheet was last updated by Charles Cotton. The differential needs to be high enough to reward taking more responsibility. https://en.wikipedia.org/w/index.php?title=Pay_scale&oldid=967994867, Articles with limited geographic scope from September 2017, Creative Commons Attribution-ShareAlike License, This page was last edited on 16 July 2020, at 15:29. Find your perfect qualification and study centre, or read our guidance to choose the right course for you, Achieve your CIPD qualification online with ultimate flexibility, Browse and purchase our range of textbooks, toolkits and e-books, Learn about the knowledge and behaviours needed to work in the people profession, Assess yourself against the CIPD Profession Map and view personalised development options, Get an internationally recognised professional qualification, All you need to know about being a CIPD student as well as access to a wide range of resources, The essential companion for busy HR professionals, Gain insight on issues that matter to HR and L&D, Our profession plays an important role in ensuring work benefits everyone. Follow these simple tips to realize a fair wage for the employer and employee. Pay structures have two key characteristics: There are short definitions of different pay structures below, although definitions do vary, and approaches may overlap at times. ‘Differentials’ refer to the percentage difference in pay between the mid-point of one grade and the mid-point of the adjoining grade. It’s important to understand the basis for any grades or bands being incorporated into a new or revised pay structure. Please rate 1 star for "NHS Nurses Dont Earn Enough" through to 5 Stars for "NHS Nurses are paid too much", a three star rating indicates that your feel that NHS Nurse are paid an appropriate wage in 2020. Please note that some of our resources are for members only.