1) Discuss the three main level of salaried employees in India.
Answers
Types of salary structure
There are three main types of salary structure businesses use:
Traditional
Broadband
Market-based
Traditional structure :
Traditional salary structures are divided into numerous pay grades. Salary increases are relatively small jumps between pay grades. Employers can use traditional structures to prevent employees from capping out at the maximum salary too quickly.
Traditional salary structures are the second most commonly used system. Twenty-four percent of businesses use traditional salary structures.
Decide what an employee needs to do to move onto the next pay grade. You may use a variety of metrics to determine a pay raise, such as performance and length of employment.
Set the minimum and maximum salary range for each employee or employee group. Then, determine the number of pay grades within the structure.
Broadband structure :
Broadband structures are more flexible than traditional salary structures. These salary structures utilize fewer pay grades. And, each pay grade has a wider salary range than traditional structures.
Only 5% of companies use broadband salary structures.
If you use the broadband structure, you have more leeway when deciding an employee’s salary. You aren’t limited by a narrow salary range like a traditional structure.
However, using a broadband system can lead to greater pay inequalities between employees. Consider conducting a pay audit to identify pay disparities due to race, gender, disability, etc.
Market-based structure :
Market-based structures are based on what other employers pay employees. Under a market-based salary structure, conduct an external pay audit to determine your salary ranges for each position.
Market-based salary structure is now the most popular system, with 55% of businesses using it.
To find out what workers are earning outside your business, do some research. Use resources like the U.S. Bureau of Labor Statistics or Glassdoor to see what employees in similar positions earn.