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Step 1: Determine the Organization's Compensation Philosophy. Step 2: Conduct a Job Analysis. Step 3: Group into Job Families. Step 4: Rank Positions Using a Job Evaluation Method. Point method. Ranking method. Step 5: Conduct Market Research. Step 6: Create Job Grades.
Step 1: Determine the Organization's Compensation Philosophy. Step 2: Conduct a Job Analysis. Step 3: Group into Job Families. Step 4: Rank Positions Using a Job Evaluation Method. Point method. Ranking method. Step 5: Conduct Market Research. Step 6: Create Job Grades.
Set your upper salary limit by what a particular job is worth to you. Know the market to determine the least you'll pay. Match jobs whose value comes with hours to hourly pay. Match jobs whose value comes in insight or skill to salaried pay.
Using benchmarking to set salaries. For example, you could use market data to determine a pay grade's salary range. Creating grades according to existing salaries. Companies can look into their existing organizational levels and salaries and group jobs accordingly.
To calculate the salary midpoint formula, take the sum of the range's minimum and maximum and divide the sum by two. That will give you the midpoint for your range.
Click inside the first blank cell below the numbers you sorted, type "=Median(First_Cell:Last_Cell)" without quotes in the blank cell and press "Enter." For example, if the first cell is A1 and the last cell is A5, type "=Median(A1:A5)" in the blank cell and press "Enter." Excel computes the median for the numbers
The compa ratio formula is the annual salary divided by the midpoint of the salary range. In general, an average employee will have a compa ratio of about 100 percent.
A traditional salary range is commonly 30 percent to 40 percent. It is common that top salary grades (i.e., for executives and top management) have a wider range (sometimes greater than a range of 40 percent) and that the lowest salary grades often have the narrowest range (sometimes smaller than 30 percent).
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