Assess & Create Pay Bands
Support organizational strategy with well structured pay bands.
Send a friend or colleague a link to this article
RETIRED CONTENTPlease note that the content on this page is retired. This content is not maintained and may contain information or links that are out of date.
- Battling for talent in an increasingly competitive world while balancing labor spend is a challenge for all organizations.
- Organizations have the opportunity to create balance and maintain their desired competitive position with well-structured pay bands.
- Pay bands will be slightly different for all organizations, but the manner in which they are constructed and applied is built on a foundation of commonalities.
- Understand the organizational characteristics that would warrant a pay band system, and if you deem one appropriate for your organization, choose the construction type and application method that will best suit it.
- Pay bands apply rigidity and control to a salary structure – adjust the level of flexibility to suit the needs and culture of your organization.
- Organizations with high or low retention or job offer acceptance, or with an inequitable salary assignment (either real or perceived) need to consider implementing a new pay band structure.
- The costs and consequences of a poor pay band structure tax the workforce with unnecessary burdens (dissatisfaction with pay) and shave real dollars off the bottom line.
- Creating pay bands internally is a manageable task when you have a comprehensive process to follow.
Impact and Result
- Learn the value of pay bands in supporting organizational strategy.
- Evaluate and select a best-fit pay band structure to increase the efficiency and effectiveness of the current salary structure.
- Create pay bands to maximize labor spend.
- Seven in-depth interviews with HR leaders, line of business managers, and executives to learn about their practices and philosophies surrounding pay bands.
- A ten-question survey to better understand the strategy and uses of pay bands among different organizations. The survey attracted 78 respondents.
Get the Complete Storyboard
See how all the steps you need to take come together, with tools and advice to help with each task on your list.Download Now
Get to Action
Assess pay bands
Create a structure that supports organizational strategy.
Evaluate different types of pay bands
Choose a structure that best suits your organization.
Create a pay philosophy
Make compensation decisions that lead in the right direction.
Calculate the costs of transitioning to a new pay band structure
Test the feasibility and needed time frame to make a complete transformation.
Update organizational compensation policy
Reflect the changes that pay bands incur.
Craft a Compensation Philosophy
Create a Job Worth Hierarchy Based on Internal Worth
Design a Base Pay Structure
Conduct an Annual Salary Assessment
Create a Culture of Recognition to Drive Engagement, Improve Retention, and Increase Profitability
Use Flexible Work Arrangements and Time Off to Attract and Retain Top Talent
Develop a Strong EVP to Attract Top Talent
Write Effective Job Descriptions
Optimize the Employee Wellbeing Program
Create a Variable Compensation Plan
Train Managers on Compensation Philosophy & Effective Pay Communication
Evolve Pay for Performance