5 Things to Consider When Determining Your Employee’s Salary

• Define the job.
• Price the job.
• Determine the job’s internal value to your organization.
• Place the job in your salary structure.
• Consider organizational factors, including budget.

Why do we need a pay structure?

A pay structure creates a basis for pay decisions and allocation. Understanding where your employees fit against the pay structure – within, above or below the band – informs your pay decisions and allows for effective allocation of pay budgets. If not always saving you money, it ensures you get the most value from it.

What’s the best way to answer the salary question?

Provide a range: If you don’t feel comfortable providing a single number, you may choose to offer a range instead. Keep in mind, however, that the employer may opt for the lower end of your range, so make sure your target number is as close to the bottom number as possible.

Why are pay ranges important in the job market?

That approach can work for other employers, too. Pay ranges are generally tied to the labor market, and available salary levels represent the maximum value of a given position. If workers want more pay, they need to develop the knowledge and skills necessary to move into another role or level.

What’s the best way to set salary expectations?

Your goal when setting your salary expectations is to come up with a range that’s appropriate for your skills, experience, role, and location. It’s not about how much money you need or want — at least, not at first. It’s about how much money you can command, based on what you have to offer.

What should be the progression of my salary?

Ideally, the management/professional progression from salary grade to salary grade typically should be between 10 and 15%. The administrative/operative progression should be between 5 and 10%. The progression of market data can vary depending on industry, type of job, and level of job.