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How to Establish Salary Ranges
Source: shrm.org
Article summary:
1. Establishing salary ranges is important for employers to control their pay expenses and ensure pay equity among employees.
2. Employers must first determine their compensation philosophy, which can be to lead, lag or match the market when compensating employees.
3. A job analysis should be conducted to determine the activities and responsibilities of each job, followed by grouping jobs into separate job families and ranking positions using a job evaluation method.
Article analysis:
The article provides a basic set of steps for creating compensation grades and salary ranges that are intended for general use but should be tailored to meet an organization's specific needs and goals. The article is written in a clear and concise manner, making it easy to understand the key points of establishing salary ranges. It also provides helpful examples such as the Hay point method system which uses three factors to measure the degree that these three factors are required for each position.
However, there are some potential biases in the article that could affect its trustworthiness and reliability. For example, it does not provide any evidence or research to support its claims about how employers should approach compensation decisions or what methods they should use when creating salary ranges. Additionally, it does not explore any counterarguments or present both sides equally when discussing different approaches to compensation decisions. Furthermore, it does not mention any possible risks associated with establishing salary ranges such as potential legal issues or employee dissatisfaction with pay rates.
In conclusion, while this article provides a basic overview of how to establish salary ranges, it lacks evidence-based research and fails to explore counterarguments or present both sides equally when discussing different approaches to compensation decisions. Therefore, readers should take this information with a grain of salt and consult an expert if they need help developing a compensation structure for their organization.