Sound salary management is essential to ensure that each employee is compensated appropriately in relation to his or her colleagues, based on the relative contribution of each employee to the health of the organization.
The compensation policy establishes the rules for the administration and progression of individual salaries within your salary structure. It allows managers to position salaries in the compensation structure at the time of hiring and to determine the salary progression of each individual in a healthy and consistent manner throughout the company.
Guiding Principles of a Compensation Policy Mandate
Provides a structured, yet flexible framework for individual salary management decisions across the organization
Aligned with the company’s compensation strategy and philosophy as well as other dimensions of your organization’s internal and external environment
Establishes different zones of progression within the salary structure to guide decisions on salary increases or placement within the salary ranges for hires, promotions, temporary assignments, etc.
Reflects the link between salary progression and the respective contribution of each employee to the organization
The wage policy also includes a tool for annual wage increases
