Why Ranges are Important
Hay's recommendations for hiring and promotion practices necessitate that employees' pay will be able to move through the range and reach the midpoint (also referred to the market average) in less than 10 years. Salt Lake County pay policies will reflect the Hay Group's recommendation on how employees are initially placed in the range and how they are allowed to move through the range.
With any grade pay structures, once the midpoint (market average) is established for each grade, the minimum and maximum can be calculated at any desired range spread. The Salt Lake County Compensation Committee agreed to a 50% range spread. This is a standard practice in the market.
The range minimum and maximum are established to set the limit or the dollar value of a job to an organization. If the grades did not have an established minimum or maximum, an organization could keep increasing the base pay for any position without regard to its market value.
It is common with salary grade pay structures for employees' pay to increase in the grade as their competencies, expertise and performance increase. They usually do not rely heavily on just an annual increase.
Keeping Structures Current
In order to keep employee salaries competitive with the market, Human Resources must ensure that the mid-point for each grade stay current. Every year Salt Lake County will conduct market research, relying heavily on salary survey data to determine what market average pay is for benchmark positions in our organization. Market average pay determines mid-points for our ranges. Keeping these mid-points in line with market averages requires that our entire pay structures move accordingly. This means that minimum, midpoint, and maximum ranges may go up periodically to keep up with the market.
NOTE: If employees are placed properly in their range, and ranges move up to keep up with inflation and market demands, then it will be rare for an employee to reach the maximum of their range. The exceptions will be for employees who are in the same position for many many years.