Tag: salary scales


Now that your salary scale and benefits package is ready, the final step is implementing your new scale and communicating the changes to your teams. Equipped with your analysis and overall cost implications against your budget, you will now need to secure the necessary approval from management.

When seeking approval, begin by presenting any existing issues with the current salary scale and the challenges your salaries are facing against the external market. Take management through your process when you built your new salary scale, making sure to highlight:

  • The chosen salary survey you used as a basis
  • Your chosen set of target comparators that met your criteria
  • The difference of your existing salaries against your target market position
  • The steps you have taken to address the current issues and build future capacity
  • The overall cost

Finally, you also need to present to management your implementation plan and the timeframe that it will require, so they can assess the entire impact of the new scale.

Once approval has been granted, the next step is communicating the changes to staff. This is a crucial process because you will need to equip your managers with the right information for them to relay later to each of their teams or units. When discussing the changes with your staff, keep these in mind:

  • Discuss the work that went into building the salary scale and be clear on the company policy that supports the steps you have taken. This will ensure that your managers will be ready to answer any questions or reactions their staff may have.
  • Be clear about your implementation plan, what staff can expect, and when. This way, you can manage everyone’s expectations and hopefully have them feel excited about the changes that are soon to take place.

With the steps we have shared on implementing your new scale, we hope this has provided you with the insight you need to get started in designing your own pay structure. Birches Group is always ready to help organizations create a salary scale that will work for them. Contact us to learn more.


Want to know if your existing compensation practices have the elements of a good compensation program or if there are areas that could use some improvement? Take our quick Compensation Program Assessment Quiz to know your score!


Bianca manages our Marketing Team in Manila. She crafts messaging around Community™ concepts and develops promotional campaigns answering why Community™ should be each organization’s preferred solution, focusing on its simplicity and integrated approach. She has held various roles within Birches Group since 2009, starting as a Compensation Analyst and worked her way to Compensation Team Lead, and Training Program Services Manager. In addition to her current role in marketing and communications, she represents Birches Group in international HR conferences with private sector audiences.

Follow us on our LinkedIn for more content on pay management and HR solutions.


Now that you’ve created your salary scale and examined your benefits package; the next step is adjusting your scale. Refining your scale will be a trial and error process until you get as close to your target as possible. There are several factors that will affect the impact of your scale, both externally and internally, so it is crucial to keep these in mind every step of the way.

When we think about external factors that affect the impact of your salary scale, factors such as average market movement, your budget, the number of incumbents per grade level in your organization, as well as the overall cost all need to be considered. When you start allocating adjustments for each grade level in your scale, using the average market movement and your budget, you can start adjusting your scale’s minimums and maximums, while keeping the number of incumbents per grade level in mind. Once you have gotten as close to your target market position as possible, check if your adjustments are all within budget. If not, keep adjusting and tweak where necessary.

While adjusting your pay ranges, you also want to keep in mind the issues that your existing salary scale has and how your changes will best address them. Are your hiring rates competitive at the job levels where you need more capacity? Do any of your existing staff fall below your current hiring rates? Similarly, do you have staff that are currently paid beyond the maximum salaries of their grade level? Do you make use of your salary ranges per grade level or do you find many of your staff clustered in certain points in each grade? Remember, adjusting your salary scale is not simply about updating salaries following market movement. It is also about making corrections where you know there are inefficiencies in the current pay structure.

Just as important as reaching your target market position and being competitive externally, is your team’s internal cohesion. Once you have reached your desired salary scale results, give it another look to see if everything makes sense. Pay close attention to your internal parameters, such as the progression from one grade level to the next, and see if the overlaps are reasonable. Examine your spans – the difference between your minimum and maximum salaries – as well and see if they align with the nature of each job level within your organization. Also, you will need to see how each of the adjustments you made will affect staff at every grade level. Checking for fair internal cohesion will ensure strong staff engagement to which they can tailor their development and build their careers over time.

Designing and refining salary scales is both a technical exercise and a sensitive one. As managers in human resources, we must realize that without an efficient salary structure in place, along with a solid job structure, achieving a strong engaged workforce will always be a challenge. And while we know that the salaries we set will not always make everyone happy – someone will always want higher pay, someone will challenge your chosen set of target comparators, and perhaps ask why they cannot have more benefits – what is important is making sure that the policies that went behind designing the salary scale is clear and communicated to staff. To learn more about how Birches Group can help you design a salary scale fit for your organization’s needs, contact us today.


Want to know if your existing compensation practices have the elements of a good compensation program or if there are areas that could use some improvement? Take our quick Compensation Program Assessment Quiz to know your score!


Bianca manages our Marketing Team in Manila. She crafts messaging around Community™ concepts and develops promotional campaigns answering why Community™ should be each organization’s preferred solution, focusing on its simplicity and integrated approach. She has held various roles within Birches Group since 2009, starting as a Compensation Analyst and worked her way to Compensation Team Lead, and Training Program Services Manager. In addition to her current role in marketing and communications, she represents Birches Group in international HR conferences with private sector audiences.

Follow us on our LinkedIn for more content on pay management and HR solutions.


Analyzing your benefits package is a step that can’t be missed. In many labor markets around the world, benefits are an essential part of total compensation. Particularly in developing markets, some benefits are mandatory, others may be cultural, and some given to address certain realities on the ground. Whether you are a local organization or an international one, it is essential to have a policy that aligns with your market’s local conditions.

Additionally, benefits are also an important part of a company’s Employment Value Proposition (EVP). Determining which benefits your company provides, the frequency it is provided, and grade levels eligible to receive them can be used a strategy to attract and retain talent, showcase company culture, and be seen as an employer of choice.

Once you have aligned your total compensation against the market, designing your benefits package will begin by ‘backing out’ your benefits to arrive at just base salary. From there, you can assess which benefits to keep and maintain, and which ones to change.

When examining your benefits package, here are three things we suggest you keep in mind:

  • What benefits are considered mandatory in your market? – different countries have different mandatory benefits. Some countries have mandatory bonuses on top of base salary, others may have mandatory housing or transportation allowances, while others have government-mandated health and pension contributions. As an employer, you will need to follow what is prescribed by law, especially if you are an international organization.
  • What benefits are common practice in your market? – knowing which benefits are commonly provided by most employers in your market can also help when designing your benefits package. Of course, it is not necessary to follow every single benefit provided. But those that are given by majority of the companies could be considered and examined further against your budget and policy.
  • What benefits are considered tax-advantageous to your staff? – depending on your market, some benefits can be considered taxable and others non-taxable. When thinking about benefits, employers can provide contributions or cash benefits that do not trigger a tax deduction from staff or maximize its non-taxable portion as much as possible.

Further, when designing your benefits package, employers also need to think about the grade levels that each benefit will apply to. Unless it is mandatory, not all benefits need to be provided to all grade levels and in the same manner. There are some benefits that are given to certain grade levels due to the nature of their jobs. Incentive-based benefits and representational benefits are more common for roles in managerial levels, while cash allowances and transportation benefits are more commonly provided to general and process-based grade levels.

Benefits can also be used by employers to encourage desirable behaviors from their staff. A classic example is using performance bonuses to reward achievement and a job well done at the end of the performance year. Another is the use of loans, seniority allowances, or even company-sponsored savings plans to promote staff retention. Sometimes, companies also hold activities that foster workplace culture among their employees, from team lunches, happy hour, to corporate social responsibility events. In our many years of conducting salary surveys and collecting data from employers in over 150 countries, we have certainly seen a lot of creativity from employers when using benefits that highlight their unique company culture.

When analyzing your benefits, we must remember that, in the end, benefits are cheaper than salaries. Base salary, bonuses, and allowances all come from the same internal budget, so every dollar that goes into providing more benefits will take away from the budget for other components of your staff’s employment package, such as pension and salary increases.

Birches Group can help your organization design a benefits package that aligns with your policy while meeting local conditions. Contact us to get started.


Want to know if your existing compensation practices have the elements of a good compensation program or if there are areas that could use some improvement? Take our quick Compensation Program Assessment Quiz to know your score!


Bianca manages our Marketing Team in Manila. She crafts messaging around Community™ concepts and develops promotional campaigns answering why Community™ should be each organization’s preferred solution, focusing on its simplicity and integrated approach. She has held various roles within Birches Group since 2009, starting as a Compensation Analyst and worked her way to Compensation Team Lead, and Training Program Services Manager. In addition to her current role in marketing and communications, she represents Birches Group in international HR conferences with private sector audiences.

Follow us on our LinkedIn for more content on pay management and HR solutions.


An organization’s job structure is an illustration of its how specific jobs are grouped and classified based on the nature and purpose of work, different levels of contribution, and how each level relates and progresses to one another. More importantly, the job structure provides the framework to which organizations can apply policies on compensation management, as well as design strategies around learning and development, specifically on career opportunities and promotion, all aligning to the company’s overall business objectives.

There are different types of job structures available, each one designed to support specific needs an organization might have. When choosing which type of job structure to adapt, the focus of your existing jobs – whether career-based or project-based, any future expansion, and the possible addition of new roles or teams within your organization – should be kept in mind.

The most common types of job structures are the traditional salary structure, the broad-banded structure, and the project-based structure, each with its own advantages and disadvantages.

Types of Job Structures

  • Traditional job structure – provides a well-defined sequence or progression path from one job level to the next. Think of a typical career progression: Entry-level roles start as analysts, then progress to specialists, while MBA graduates (for example) start as specialists, then progress to managers, and finally to directors. The differences in levels of contribution, complexity, and pay ranges are explicit at each level, and movement within the grade or to the next higher-grade can be deliberate based on skills growth and experience. Traditional job structures are easier to manage and communicate to staff, but the pay ranges often have less flexibility than other approaches, particularly when staff reaches the maximum point of their job grade. Traditional structures are found most often in organizations with well-established career paths, where staff grow their careers by moving “up the ladder.”
Traditional Job Structure
  • Broad-banded structure – A broad-banded structure comprises fewer bands with multiple job levels grouped into each one. Some organizations prefer the broad bands because they provide wider pay ranges and more flexibility in pay management. As staff accumulate more skills and experience, pay increases and progression can be provided through lateral movement within each band without necessitating a promotion. Broad bands are not without their own challenges, however: They often cause confusion for managers and staff since less structure and guidance are provided for salary setting and the differences between job levels within each band are not as distinct as a traditional structure. Broad-banded structures are more popular with organizations that desire a flatter hierarchy and fewer levels.
Broad-banded job structure
  • Project-based Structure – The project-based structure also has grades or bands similar to the first two structure types above. What makes this structure different is that each grade or band is designed for roles that have short lifespans to reflect the project timing, without the possibility of promotion. A structure like this is only appropriate for project-based organizations with definite term contracts. Project-based structures often have higher minimums reflecting the need for employers to reach experienced talent that can “hit the ground running.” Employers utilizing such a structure should also consider project completion bonuses to improve retention.
project-based job structure

In Birches Group, we believe that a simple, clear, and consistent approach to job evaluation is the key to a well-designed job structure. The type of structure and number of grades an organization chooses to go with is an easy one to adapt, but without a solid job evaluation methodology to readily provide the standard needed to classify your jobs into their appropriate levels, will only lead to bigger issues in capacity and pay management in the future.

Our Community™ Jobs solution uses only three factors – Purpose, Engagement, and Delivery – to evaluate any job across fourteen grade levels. These three factors are found in any job and together, provides a simple and transparent methodology that serves as the foundation for an exceptional job structure.

Organizations require structure to optimize and ensure the capacity it needs to achieve its goals and ultimately lead to business growth. Job structure, along with the pay structure, are one of the most important human resources management tools an organization will need to build and maintain an organized and efficient workforce. Through our integrated workforce management solution, Community™, Birches Group is ready to help your organization create a job structure that fits your needs. Contact us to learn more.


Want to know if your existing compensation practices have the elements of a good compensation program or if there are areas that could use some improvement? Take our quick Compensation Program Assessment Quiz to know your score!


Bianca manages our Marketing Team in Manila. She crafts messaging around Community™ concepts and develops promotional campaigns answering why Community™ should be each organization’s preferred solution, focusing on its simplicity and integrated approach. She has held various roles within Birches Group since 2009, starting as a Compensation Analyst and worked her way to Compensation Team Lead, and Training Program Services Manager. In addition to her current role in marketing and communications, she represents Birches Group in international HR conferences with private sector audiences.

Follow us on our LinkedIn for more content on pay management and HR solutions.

Pay Management using Skills-based Approach

To effectively manage salaries, organizations need a compensation policy that will guide them during the scale design exercise. A compensation policy outlines the organization’s approach to selecting and refining their relevant comparator sample, determining their target market position, identifying which benefits to assess and include in their pay package, as well as determining the frequency of salary scale reviews. There is a misconception that salary survey data alone, can give organizations what they need to manage compensation. But in Birches Group, we believe that having a strong compensation policy, coupled with good survey data, will steer organizations in the right direction toward the answers that they need. Without a compensation policy, it will be difficult for organizations to know where to start, or what to do with the survey data that they have.

When establishing your compensation policy, a few things need to be considered, beginning with identifying one or more surveys of high quality as your source of market data. Be sure you fully understand each survey’s methodology and approach so you can easily aggregate the results in your market comparison.

Once you have your salary survey data, the next step to designing your salary scale is to establish a refined comparator sample comprised of employers important or comparable to you. While having a robust salary survey may sound ideal in providing an extensive range of data, not all survey participants will be relevant. Your compensation policy should clearly identify the number of comparator organizations to be selected and the criteria they must meet to be included in your market comparison.

Building a Compensation Policy, Examples of Criteria to Consider:

  • Talent competitors (those you recruit talent from and lose talent to)
  • Industry peers
  • Organizations of the same size or in the same geographic location
  • Other leaders in your market outside of your sector

Choosing the right target comparators is key to be able to narrow down the bigger survey data to a group of more significant employers that share qualities parallel with your organization. Additionally, organizations need to keep in mind that participants in a survey can change each year, with new ones added and old ones dropped. The key is having consistent criteria that ensure, even with a changing survey sample, your selected comparator group is consistent and still sufficient to meet your requirements.

Once you have selected your target comparators or target market, you will need to identify your target market percentile or target market position. Selecting your target percentile would depend on how competitive you want to be against your chosen market, while also taking your organization’s budget into consideration. Your organization’s compensation policy should define the ideal market position it requires to reach the talent it needs to recruit and retain. Further, the compensation policy should also identify if all levels in the organization will have the same market position or will be tailored to each level.

If your organization is facing challenges to recruit or retain talent, you should reassess your target market position and adjust it to ensure your organization is positioned competitively against your chosen market. Sometimes recruitment and retention issues are limited to specific grades or bands. While some organizations may use the same target market position for all grade levels, labor markets are not uniform and do not move in a linear fashion. Certain grade levels can move faster due to high demand, hot skills, or other considerations. Organizations can choose a more competitive target market position for job levels where these talent challenges exist.

In our article, It Starts with Jobs, we explained that there are four labor markets, not just one. In Birches Group’s Community™ approach, these are called the four job clusters. Different grade levels in the labor market are grouped into these four job clusters and movement from cluster to cluster can be very distinct, where jobs at higher grade levels often move much quicker than jobs at the lower levels. It is important for employers, when comparing their salaries to the external market, to recognize this when deciding which grade levels to adjust as it allows for a more refined approach that is targeted to the organization’s needs, rather than simply applying an across-the-board adjustment.

Now that you have identified your target market comparators and target market position, your compensation policy should also outline the benefits that will be included in your compensation package. If you are looking to introduce benefits into your compensation package or change your existing benefits package, you’ll need to consider the following:

Some Things to Consider if You’re Looking to Introduce Benefits into Your Compensation Package:

  • Locally Mandated Benefits – The first place to start is by checking if there are any benefits, whether cash or in-kind, that are prescribed by law. Different countries have different mandatory benefits; some may have mandatory bonuses or allowances, while others may have mandatory contributions toward pension or medical coverage.
  • Market Practice – When assessing your benefits package, it also helps to know the common practice in the local market. While some practices may not be mandatory, if they are provided by most employers in the market, it may be a competitive requirement to follow the market. Your survey sources should be able to provide detailed information on all types of benefits.
  • Benefits that Promote Desirable Behaviors – Some employers use benefits to promote desirable behavior among their staff. For example, a performance bonus to reward achievement and encourage good performance, and seniority bonus or subsidized loans to promote retention.

Finally, your compensation policy should also identify how frequently your salaries will be reviewed. In Birches Group, we recommend that organizations review their salaries and benefits every year to ensure that their salary scale is adaptable to changing operational realities in terms of budget and resources, and evolving team structures, as well as ensure that their scales are aligned to their target market position and is able to adapt to changing market trends.  

It is important for organizations to have well-articulated pay policies in place that will not only guide how they develop their salary structure and manage compensation, but also provide the framework for forming strategies around recruitment and retention of their staff, proving this to be a valuable HR tool. Birches Group is ready to assist in establishing the appropriate compensation policy that can address your organization’s needs. Contact us to learn more.


Want to know if your existing compensation practices have the elements of a good compensation program or if there are areas that could use some improvement? Take our quick Compensation Program Assessment Quiz to know your score!


Bianca manages our Marketing Team in Manila. She crafts messaging around Community™ concepts and develops promotional campaigns answering why Community™ should be each organization’s preferred solution, focusing on its simplicity and integrated approach. She has held various roles within Birches Group since 2009, starting as a Compensation Analyst and worked her way to Compensation Team Lead, and Training Program Services Manager. In addition to her current role in marketing and communications, she represents Birches Group in international HR conferences with private sector audiences.

Follow us on our LinkedIn for more content on pay management and HR solutions.

Salary Scales

A salary structure is essential in every organization. It is the single most important document in human resources. Build a salary scale and have a salary scale, why bother? It tells you everything you need to know about an organization:

  • How the organization positions itself in the market
  • The value the organization places on its jobs
  • How relationships across jobs are managed
  • Possible career progressions
  • And where the organization stands on equity and transparency

For an organization to work efficiently and achieve team cohesion, a well-balanced salary scale is crucial as it drives all other critical HR programs — everything from recruitment, staff retention, promotion, and ultimately career development.

Many organizations fail to realize the value of a salary scale. More than just pay ranges, a salary scale, when used correctly, can guide an organization to efficiently execute all its different HR functions and strategies, from managing compensation to managing its people.

Beginning with compensation, though, the fundamental purpose of a salary scale is to provide a framework for managing salaries. Setting competitive hiring rates that facilitate recruitment, establishing pay ranges that show value for experience, and defining the differences in pay from one job level to the next — all these need to be managed carefully to ensure that organizations are attracting and retaining the talent they need while maintaining team cohesion.

Of course, salary scales’ use extends beyond compensation. Learning and development milestones can be defined by the underlying job structure used to build the salary scale, which enables effective career pathing. Salary scales can also facilitate the mechanisms to reward employee development through recognition of skills growth. Finally, a well-designed salary scale demonstrates and promotes fairness and equity within the organization.

To develop salary scales to meet the unique requirements of your organization, you need to start by establishing your job structure, defining your compensation philosophy, and developing your scale design methodology.

This is the first of our blog series on “Building Your Salary Scale.” In our next post, we will be discussing how you can begin to develop your organization’s compensation philosophy and the different elements that need to be considered. Birches Group can help design a salary structure that meets your organization’s needs. Contact us to get started.


Want to know if your existing compensation practices have the elements of a good compensation program or if there are areas that could use some improvement? Take our quick Compensation Program Assessment Quiz to know your score!


Bianca manages our Marketing Team in Manila. She crafts messaging around Community™ concepts and develops promotional campaigns answering why Community™ should be each organization’s preferred solution, focusing on its simplicity and integrated approach. She has held various roles within Birches Group since 2009, starting as a Compensation Analyst and worked her way to Compensation Team Lead, and Training Program Services Manager. In addition to her current role in marketing and communications, she represents Birches Group in international HR conferences with private sector audiences.

Follow us on our LinkedIn for more content on pay management and HR solutions.


The salary scale is the single most important document in human resources. It tells you everything you need to know about an organization:


• How the organization positions itself in the market
• The value the organization places on its jobs
• How relationships across jobs are managed
• Possible career progressions
• Where the organization stands on equity and transparency


For an organization to work efficiently and achieve team cohesion, a well-balanced salary scale is crucial as it drives all other critical HR programs — everything from recruitment, staff retention, promotion, and ultimately career development.


Designing a salary scale requires skill and expertise, balancing the internal considerations and team dynamics with the external market. It’s an art form, not just math.


A company’s salary scale is a reflection of its pay philosophy. A salary scale illustrates an organization’s values in terms of how it positions itself in the market and a demonstration of its internal pay policies – whether career-based or project-based. But more importantly, salary scales can tell us everything we need to know about an organization – from its internal cohesion explicitly differentiating the value they are willing to pay at each job level, to how they approach the symmetry between experience and responsibility.

In addition, organizations use salary scales as a tool to manage staff. Its structure shows the relationships of work from one grade level to the next, variable, or predictable movement within the organization, and expectations around career can be identified.

Types of Salary Structures

The three most common salary structures applied by most organizations is the traditional, broadband, and step pay structure.

  • Traditional Structure – typically has multiple grades, each with established salary ranges providing for a well-defined progression path from one job level to the next. Because of its straightforward design, career progression is clearer and easier to communicate because differences between job levels are very distinct and pay and career movement can be done in a controlled manner.
  • Broadband Structure – has fewer bands with multiple job levels grouped into each band. Many organizations find this structure to be more flexible where career progression can be done through lateral movement within each band and salary increases can be provided without necessarily warranting a promotion. However, differences between job levels is not as distinct in the broadband design which could be a cause confusion among staff.
  • Step Pay Structure – is made up of multiple grades, and each grade has several steps representing scheduled pay increments every year. The step pay structure’s rigid design allows for clear and predictable pay movement within each grade, but is linked to staff tenure/time rather than skills growth.

Tailoring Your Salary Structure to Support Multiple Employment Scenarios

Once an organization has decided on their salary structure type, each grade should now be tailored to illustrate different employment scenarios that can be expected in that organization.

What many do not realize is that there is more to building a salary scale than just simply setting minimum and maximum salaries at each level. There are two other things to keep in mind when designing your salary scale, and that is your Span and your Inter-Grade Differential. To put it simply, the span of your salary scale is the difference between the minimum and the maximum salary of each grade level. This ultimately defines the range of pay for work at any position. Your inter-grade differential, on the other hand, refers to the overlap between one grade level to the next. This allows you to differentiate the level of responsibility between grades. Organizations need to keep in mind that the spans of certain grade levels would depend on the nature of the jobs in that grade. For some jobs, their nature is to progress deeper into their grade resulting to more complex and highly-skilled work, some are expected to advance to the next higher grade, while for others, the nature of their role does not change.

In the case of project-based jobs, it would be logical to apply narrow spans for their grade levels because their roles are not designed to be short-term depending on the project. Career-based jobs, on the other hand, would have wider salary ranges to support growth in skills, moving them deeper into the grade or advancement to the next higher grade over time. Lastly, there is also time-based jobs where their nature does not change justifying a wide salary range but does not allow for much discretion for pay increments or career advancement.

Below are three examples of salary scales showing different employment scenarios, number of grade levels and overlaps between salary ranges:

The salary scale above is an example of a traditional structure with multiple grade levels with each grade mapped to one job level. Salary ranges for each grade is defined showing the value the employer has established for each level of work, and movement from one grade level to the next is clear.

The salary scale above is an example of a broadband structure that has fewer grade levels/bands, but with multiple job levels present in each grade. As staff accumulate more skills and experience, pay increases and progression can be provided through lateral movement within each band without necessitating a promotion.

The salary scale above is an example of a project-based employment scenario which also has grades or bands like the first two structure types above.  What makes this structure different is that each grade/band is designed for roles that have short lifespans to reflect the project timing, without the possibility of promotion. A structure like this is only appropriate for project-based organizations with definite term contracts. Project-based structures often have higher minimums reflecting the need for employers to reach experienced talent that can “hit the ground running.”  Employers utilizing such a structure should also consider project completion bonuses to improve retention.

A salary scale is essential for any organization. It affects all other areas of HR – from recruitment, to pay management, career development, and promotion. But we recognize that not all organizations have the capacity to design a salary scale. Birches Group has extensive experience in designing salary scales to fit the needs of organizations from different sectors and markets. Contact us to learn more.


Bianca manages our Marketing Team in Manila. She crafts messaging around Community™ concepts and develops promotional campaigns answering why Community™ should be each organization’s preferred solution, focusing on its simplicity and integrated approach. She has held various roles within Birches Group since 2009, starting as a Compensation Analyst and worked her way to Compensation Team Lead, and Training Program Services Manager. In addition to her current role in marketing and communications, she represents Birches Group in international HR conferences with private sector audiences.