Alternative Pay Progression Strategies: Broadbanding Applications

As an organization delayers its structure, establishes work teams, and embraces quality initiatives, it also may consider realigning its pay and classification system to support and promote these changes. Broadbanding is one vehicle for moving these changes forward. This report, Alternative Pay Progression Strategies: Broadbanding Applications, begins by reviewing some basic aspects of compensation and broadbanding that will help clarify further discussion on pay progression strategies. (The term “pay progression” refers to how the pay rates of individual employees will be adjusted over time). The report presents three categories of pay progression strategies: 1) time-based, 2) performance-based, and 3) development-based. These strategies can be used singly or in combination. How an organization applies them depends on its culture, environment, work structure, and its overall goals and strategic plans. The description of each category includes: a) organizational characteristics best suited for implantation; b) methods for determining the amount of a pay adjustment; c) advantages and disadvantages; and d) examples of the pay progression strategy in practice. The effects of combining the strategies are also discussed. ~