Job Company Base Pay
Administrative assistant: A $25000
B $31000
C $30000
D $33000
E $29000
F $28000
Average $29000 3% Lead $30000
Base pay
Benefits manager: A $62000
B $61500
C $60000
D $64000
E $63000
F $66000
Average $63000 3% Lead $65000
Base pay
Operations analysts: A $55000
B $57000
C $56000
D $58500
E $59000
F $54000
Average $57000 3% Lead $59000
Base pay
Payroll assistant: A $35000
B $34000
C $35000
D $35000
E $36000
F $29000
Average $34000 3% Lead $35000
Base pay
»» Task G: Because your company wants to lead in base pay by 3 percent, adjust the predicted pay rates to determine the base pay rate you will offer for each benchmark job.
The administrative assistant and the payroll assistant share almost similar functions and responsibilities, mainly involving clerical and office duties for the genera organization. While others like operations analysts would be in a specialized job group since, their duties involve a given degree of specialized skills or training for their respective departments. Other jobs such as the benefits manager are in a higher job group where managerial skills are required to supervise and direct duties of subordinates’ involving compensation or labor relations.
Job Group Benchmark Job
A Payroll assistant
Administrative assistant
B Operations analysts
C Benefits manager
D HR Director
»» Task I: Use your answer to Task H to determine the pay range (i.e., minimum and maximum) for each pay grade.
Job group Pay Range ($)
A 31500 - 38500
B 41500 - 76000
C 45500 – 84500
» »» Task J: Given the pay structure you have generated, consider the following:
»» Does this pay structure make good business sense? Do you think it is consistent with the organization’s business strategy?
Yes I think the pay structure makes good business sense because, the pay grades provided are sustainable through the businesses resources in the long-run. Through setting pay grades higher by 3% compared to the current market pay rates, employees will be well motivated to carry out their duties to making the organization profitable and efficient. The company is set as a 3% leader in its respective industry therefore income generated by the organization is sufficient to sustain a slightly higher wage bill. Good remuneration is in accordance with the organizations’ goal of fair labor policy and acting in favor always of employee welfare. Employees, whose performance is expected to produce a leading benchmark in an industry, are rightfully entitled to proper compensation to the tune of effort indulged and returns realized. The organization’s will to increase pay to employees by 3% is meant t achieve the organizations’ goal of being an industry leader, not only in terms of market share and output but also employee welfare.
»» What are the implications of this pay structure for other HR systems, such as retention and recruiting?
Since the organization has a higher pay rate policy with a 3% lead over the industries mean pay rate, resources given to HR will be depleted significantly by the high recurrent expense of salaries and wages. Managers at Human Resource will have to find a balanced mix of resource allocation to their various functions and activities, through cutting back on retention and recruiting activities. Staff bonus’ and allowance packages will have to be reduced so as to increase wages or salaries, while hiring of new staff will as have to reduce in order to have a narrower workforce that performs efficiently. The organization will however not reduce retention and recruiting at equal rates, bad retention policy leads to active hiring while good retention practices would reduce hiring. The company therefore will have to increase allocations to retention of highly specialized and skilled staff and reduce it in lower grade jobs which will mean that allocating to hiring low grade jobs will increase.
However these dynamics will only take place during the short-run once the organization’s objective of an industry’s 3% leader has taken off, its resources will have expanded satisfactorily to sustain the organization’s expenditure under normal business environment.
References
Onetonline.org. Summary Report for: 11-3111.00 - Compensation and Benefits Managers. Retrieved on March 9, 2013. http://www.onetonline.org/link/summary/11-3111.00
