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What makes up a salary?

JGator

Brilliant_Rock
Joined
Nov 27, 2010
Messages
1,422
I am in management in Recruiting at a large US based international company. Salary is salary. There are no components. We have pay ranges for each job, and we pay a person in the range dependent on their current salary, and what it will take them to move/switch jobs to our company. This is for people with experience. For candidates right out of college, we generally offer the same salary to everyone.
 

mayerling

Ideal_Rock
Joined
Mar 4, 2010
Messages
2,357
JGator, how did you arrive at the number for each pay grade?
 

JGator

Brilliant_Rock
Joined
Nov 27, 2010
Messages
1,422
Another group within HR (compensation) adjusts them annually based on market/competitor data.
 

rubybeth

Ideal_Rock
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Nov 12, 2007
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2,568
mayerling|1360008129|3372114 said:
I think everyone is getting hung up on the word 'component'. I completely understand that people's pay is not broken down into individual components, and that most of us probably never think about how a salary comes to be - I know I didn't before this thread. I was just interested in whether people know what factors go into devising a pay grade - because some factors do go into it. I figured someone would know.

Having said that, I do appreciate everyone's responses. :wavey:

It's like I said in my previous post, organizations do compensation and classification studies on a regular basis. This is the scale that our consultants are using:

http://en.wikipedia.org/wiki/Hay_Guide_Chart
http://en.wikipedia.org/wiki/Point_factor_analysis
http://en.wikipedia.org/wiki/Hay_Grade
http://www.haygroup.com/downloads/au/Guide_Chart-Profile_Method_of_Job_Evaluation_Brochure_web.pdf

The 'components' are know how (which includes technical knowledge, management breadth, and human relations skills), problem solving (the degree to which the position can solve a problem, and the complexity of problems the position is allowed to solve), and accountability (freedom to act, scope, and impact). So, for my organization (a library), a person who checks in and shelves books needs a bit of know how, very little problem solving, and very low accountability. It's not a big deal if they don't do their job 100% accurately. But for an administrator (my position), there are many more facets of the organization that need to be understood (big picture thinking) in order to do the job, bigger problems and more problem-solving options (for instance, only my boss and our director can close a library due to inclement weather, and only they can hire/fire employees). There's also more accountability the higher up the chain of command that you are, so I have a lot more freedom to act than a book shelver, and my decisions impact a lot of what happens in our libraries. Edited to add: minimum education requirements are also taken into account. My job requires an masters' degree or equivalent experience, a shelver could be a high school student.

To do the study, consultants came in and gave us all questionnaires about our jobs and interviewed us about what we do (imagine the 'Office Space' movie). Then, they take all of that information and look for comparable organizations. They'll compare us to comparitors with similar job types (clerical, administrative, customer service) and employers in the area we cover (we have some urban and some rural communities within our boundaries). They will also look at the broader market for library jobs. All of this will be made into a recommendation for which positions should be on which pay grades, and how much those pay grades should pay.

This is a very formal study since we are sort of a government entity, using public funds. Smaller businesses may just look at what others are paying in their area for comparable work (like, Business X is paying their graphic designer $XXk, so we should pay at least that much for our new graphic design job opening).

Can you tell I've done my research on this? :cheeky:
 
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