In a BLR webinar entitled "Compensation Strategies: How to Build a Market-Competitive Salary Structure that Retains and Attracts the Very Best," Diana D. Neelman, CCP of Compensation Resources, Inc. addressed the issue of salary structure design.

Multiple salary structures are effective in various environments, for example healthcare, management, staff, etc. Information Technology often spits out due to atypical historic movement of these jobs -- often cyclical.

Multiple structures can be effective in that each can move independently based on market conditions. For example, management structures can move differently than staff/nonexempt structures. Historically, there was a differentiation in reported movement in published studies. Lately, that differentiation has been far less but could return in the future.

• Evaluate your structure every two years and more frequently for "hot" jobs.
• Consider a percentage increase based on reported survey data and benchmark market pricing.
• Update the structure to maintain competitiveness. Determine budget impact and consider separate salary structures.

Market values should be evaluated against internal recognized hierarchy as each organization differs in the way they value each position. Job movements to new grades need to be evaluated for bring to minimum impacts. Too many job reassignments may mean that the structure needs to be reevaluated.

Post-benchmarking, job grading should be reviewed with each manager and Human Resources to determine if the job placements make sense, and then can be finalized. A position matrix can be an effective tool in helping to evaluate jobs within departments and across the organization.

Diana D. Neelman is a Principal and Senior Consultant with Compensation Resources, Inc.. (www. compensationresources.com) She manages the research and data analysis relative to the design and implementation of comprehensive compensation programs. Ms. Neelman is responsible for the development of written policy and communication materials, including plan documents, policies and procedures manuals and administrative forms that support the plan designs. She is also responsible for developing and conducting training programs covering various compensation topics. Furthermore, she oversees CRI's Survey Department, which published various compensation and benefits studies each year.

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