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    Spot Salaries, (Individual Pay Rates, Spot Rates)

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    Eugene Rugo
    Compensation to employees refers to remuneration provided to employees in return for services rendered to an organization. Remuneration plays an important role in an employee's standard of living, social status, motivation, loyalty, and productivity. A pay structure is a system that defines what each individual and job role is paid based on their value and effectiveness. There are different types of pay structures including spot salaries, narrow-graded structures, and broad-graded structures. Spot salaries assign a single pay rate to each job or person, narrow-graded structures have many grades with similar jobs grouped together, and broad-graded structures have fewer wider grades to allow for more pay progression within each grade.

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    Spot Salaries, (Individual Pay Rates, Spot Rates)

    Uploaded by

    Eugene Rugo
    61 views2 pages
    Compensation to employees refers to remuneration provided to employees in return for services rendered to an organization. Remuneration plays an important role in an employee's standard of living, social status, motivation, loyalty, and productivity. A pay structure is a system that defines what each individual and job role is paid based on their value and effectiveness. There are different types of pay structures including spot salaries, narrow-graded structures, and broad-graded structures. Spot salaries assign a single pay rate to each job or person, narrow-graded structures have many grades with similar jobs grouped together, and broad-graded structures have fewer wider grades to allow for more pay progression within each grade.

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    Compensation to employees refers to remuneration provided to employees in return for services rendered to an organization. Remuneration plays an important role in an employee's standard of living, social status, motivation, loyalty, and productivity. A pay structure is a system that defines what each individual and job role is paid based on their value and effectiveness. There are different types of pay structures including spot salaries, narrow-graded structures, and broad-graded structures. Spot salaries assign a single pay rate to each job or person, narrow-graded structures have many grades with similar jobs grouped together, and broad-graded structures have fewer wider grades to allow for more pay progression within each grade.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    61 views2 pages

    Spot Salaries, (Individual Pay Rates, Spot Rates)

    Uploaded by

    Eugene Rugo
    Compensation to employees refers to remuneration provided to employees in return for services rendered to an organization. Remuneration plays an important role in an employee's standard of living, social status, motivation, loyalty, and productivity. A pay structure is a system that defines what each individual and job role is paid based on their value and effectiveness. There are different types of pay structures including spot salaries, narrow-graded structures, and broad-graded structures. Spot salaries assign a single pay rate to each job or person, narrow-graded structures have many grades with similar jobs grouped together, and broad-graded structures have fewer wider grades to allow for more pay progression within each grade.

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    Compensation to employees means remuneration to employees for the services rendered by them

    to the organization.

    In other words, remuneration is the compensation an employee receives in return for his or her
    service to the organization. Remuneration or reward or salary or wages paid to an employee
    plays a very important role in his or her life because his or her standard of living, status in the
    society, motivation, loyalty and productivity depend upon the remuneration received by him or
    her.

    A pay structure is a system that defines what each individual and job role is paid based upon
    their value to the business and effectiveness in their role. For each type of pay structure, there are
    a variety of different methods for deciding upon and separating employee pay, each with its own
    advantages and disadvantages.

    Spot Salaries, (Individual pay rates, Spot rates)

    With a spot salary there is a single hourly or weekly pay rate or a single annual salary attached to
    each job, or possibly to each person, in an organization. Spot rates are often used for lower-
    skilled, or in trades type roles, where the ‘rate for the job’ or the ‘going rate’ is well publicized in
    the market. Conversely, spot salaries often also occur at the other end of the scale for more
    senior positions, such as senior managers or directors, where the remuneration package may need
    to be designed to attract or retain a specific individual. Spot salaries can be created for larger
    structures using a job evaluation scheme to align roles to a market tested rate. With spot salaries
    is no formal structure in place for pay progression, although there will usually be policies for
    moving to a higher spot rate or for spot rates to be increased in line with inflation or market rates.

    Narrow-graded pay structures

    Narrow graded pay structures are made up of a large number of grades, typically 10 or more,
    with jobs of broadly equivalent worth slotted into each of the grades. These types of structure are
    often found in the public sector or services which were once closely aligned. Progression is
    frequently by means of service increments – usually annual or 6-monthly. However, because the
    grades are very narrow, most employees reach the top of the pay range for their grade fairly
    quickly, potentially leading to demands for upgrading and grade drift (jobs being ranked more
    highly than justified)

    Broad-graded pay structures

    In this case there are fewer grades than narrow-graded structures, perhaps six to nine. This means
    that the salary band within the grade is usually wider, which can help counter the problem of
    ‘grade drift’ as there is greater scope for individual employee’s pay to progress further along the
    pay grade. These types of structures are sometimes included within a definition of ‘broad
    banding’.

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