JobGrades&SalaryRangesCompa-ratios(CR)

acompa-ratio(comparativeratio)isameasureoftheextentwhichtheaveragesalariesinagradedeviatefromthetargetsalary.itisusedtocompareactualaverageswiththetargetsalarytoindicatetheextentwhichsalarylevelsarehighorlow.theformulaforcalculatingacompa-ratiois: Averageofallsalariesinthegrade---------------------------------------------------------------------------------------------------------------------------------------------------------------x100 Midpointofthesalaryrangeacompa-ratioof100indicatesthattheaveragesalaryisalignedtothemidpointofthesalarygradeandnocorrectivestepsneedtobetaken.Compa-ratios(CR)acompa-ratioof80wouldindicateaneedtoinvestigatewhyaveragesalarieswerelowandpossiblynolongercompetitive.acompa-ratioof120wouldsuggesteithertherewerealotoflong-servicestafforthatstaffwerebeingoverpaid,pa-ratioanalysiscanrevealasituationwhereearningsdrifthastakenplace.CompetitivePosture(CP)CompetitivePostureisameasureofhowcompetitivethesalaryiswithrespecttoagivenmarketbenchmark.CompetitivePosturecanbeusedtomeasurethecompetitivenessofbothcompany’sorindividual’ssalarycompetitivenessinthemarketCompetitivePostureforacompanyiscomputedas:CR=AverageofallSalariesinagivenJobGrade MarketBenchmarkSalaryCompetitivePostureforanindividualiscomputedby: CR=SalaryoftheindividualEmployee MarketBenchmarkSalary

SalaryAdministrationMinimumSalaryPoints1.Minimumsalaryforthegrade2.MinimumforJobInthemarket3.Setcompa-ratioat1.004.Overlapbetween60%to80%5.Avoidleapfroggingtendencies6.AllowforrealisticminimumSalaryAdministrationMaximumSalaryPoints1.Maximumsalaryforthegrade2.Maximumforjobinthemarket3.Keepsalaryrangeshort(8-12years)4.Maxminratiobetween1.5to2.05.Setcompa-ratioat1.006.AllowforrealisticmaximumSalaryAdministrationMaximum1.Maximumsalaryforthegrade2.Maximumforjobinthemarket3.Keepsalaryrangeshort(8-12years)4.Maxminratiobetween1.5to2.05.Setcompa-ratioat1.006.AllowforrealisticmaximumMinimum1.Minimumsalaryforthegrade2.MinimumforJobInthemarket3.Setcompa-ratioat1.004.Overlapbetween60%to80%5.Avoidleapfroggingtendencies6.AllowforrealisticminimumMinimumAndMaximumPointsStreamliningofSalaryRanges(Executives)Effective1January1995*Mosttypicalvaluecorrespondstotheworkingmidpointoftherange@Derivedfromannualbasesalary#Dispersionfactorof+/-25%aroundQ1valuesJobReferenceLevels

Thereferencejobdescriptionpreparedtoassistnon-hayevaluatedcompanieswithjobmatching,areeachevaluatedandqualityassuredagainstHay’sstandards.Theevaluationsarethenslottedintotherelevantjobunitrangewhichformsthereferencelevels.ThesereferencelevelsandcorrespondingjobunitrangesarenowstandardthroughoutallHay’smainremunerationsurveysandaredetailedbelow.JobReferenceLevelsSalaryAdministrationDeterminingEntrySalary1. Marketvalue2. Candidate'sexistingsalary3. Basicqualifications4. Additionalqualifications5. Relevantworkingexperience6. Relatedworkingexperience7. Completionofnationalservice8. Geographicallocationofcompany9. Natureofindustry(dirtyorhazardous)10.Minimumsalaryforjobgrade11.Salariesofexistingincumbents12.Re-grossingannualsalaryIncrementalSystemsIncrementalsystemsvaryfromrigidprocedureswithfixedandpredeterminedmovementsthroughascalerelatedtoage,serviceinthecompanyorserviceinthejob,toflexiblesystemswheremanagementexercisescompletediscretionovertheawardandsizeofincrementswithoutanyguidelines.Betweenthetwoextremesthereisamiddlegroundofsemi-flexiblesystems.Fixedscaleswithautomaticprogressionwhereindividualsmovethroughjobsorgradesbypredeterminedstepsrelatedtoageorservice,thesecouldberateforagescales.Fixedscalesarecriticizedbecausetheydonotgiveenoughincentivetoeffortandtheimprovementofperformance-promotionmightonlybeanawardinthelongerterm,ifatall.Theyaredefendedbecausetheycanbeoperatedwithcompleteimpartiality-manypeople,especiallycivilservants,questionthepossibilityofdeterminingafairrelationshipbetweenmeritandrewardwheretheonlymethodofmeasurementisthesubjectiveopinionofsomeone’sboss.IncrementalSystemsFixedscaleswithlimitedflexibilitywhereitispossibletogivedoubleoreventripleincrementstohighflyersandwithholdincrementsforpoorperformers.Semi-fixedscaleswhichallowautomaticprogressiontoa‘meritbar’atwhichprogressionforsomepeoplemaystopwhileothercanadvanceatdifferentratesaccordingtoperformance.Fixedparallelscaleswhichallowfortheexerciseofmoremanagerialdiscretionbyprovidingdifferentpatternsofincrementalprogressionfordifferentlevelsofperformance,asshowninfigure10.IncrementalSystemsVariableprogressionwithguidelineswheretherearenofixedincrementalpoints,butmanagersaregivenmoreorlessmandatoryinstructionsonhowtheyshouldexercisetheirdiscretion.Theminimumguidelinesinthissystemnayconsistoftheannualincrementsthatcanbeawardedfordifferentlevelsofperformance.Thesemaybeextendedinmorerigidsystemstogivetheproportionofstaffwhoshouldreceiveagivenincrement.Variableprogressioninrangewithoutguidelineswheremanagementdiscretionintheawardofincrementsandthedeterminationoftheirsizetendstoberestrictedonlybythemaximumofthesalaryrangeandthebudgettheyareallowedforsalaryincreases.IncrementalSystemsAnnualIncrementFixedincrementsystem-Fixed$-Fixed%Variableincrementsystem-Fixedvariable-FixedPlus(meritincrement)Flexibleincrementsystem-Fixedcomponent+flexiblecomponentMatrixsystem-Salaryquadrantvs.performancematrixSalaryProgressionCurveIncrementvsPerformanceMatrixMarketValueComputationSalaryReviewGuidelinesOverallcostguidelinesinwhichabudgetofx%ofpayrollisimposedformeritreviews.Thisistheesse