Question

respond to the following in a minimum of 175 words:

• What are your feelings on a traditional salary structure (many levels) vs. simplified pay bands?
• Have your thoughts on salary structure changed after this exercise?
• What are the advantages and disadvantages of using salary bands?

Answer 1

The traditional salary structure has numerous pay grades and salary increases are relatively small jumps between pay grades.Employers use traditional structures to prevent employees from capping out at the maximum salary too quickly. On the other hand simplified pay band structures are more flexible than traditional salary structures. They have fewer pay grades and it leads to greater pay inequalities between employees.

The benefits of salary bands are that they are much more flexible than traditional salary structure.The payband structure has more leeway when deciding an employee’s salary. The company is not limited by a narrow salary range like a traditional structure.

However, the disadvantages of using a broadband system are that it can lead to greater pay inequalities between employees.An employee may max out at the high end of their salary range if the company implements a broadband salary structure which may make the employee start looking at other jobs when they no longer receive raises.