Creating a Market Competitive Salary Structure

Ongoing Salary Structure Maintenance

All salary structures require ongoing maintenance to ensure they remain up to date and competitive with the external marketplace. But it is also important to ensure the structure is responsive to changes in the internal job structure and hierarchy of the organization. These changes may include:

• New and revised jobs
• Deleted jobs
• Significant market rate changes
• Acquisitions or divestitures
• Reorganizations
• New business development
• New labor markets
• Changes to minimum wage and other labor law requirements

In addition, most companies will reprice their salary structures annually. Some companies will elect to reprice the structures every two years or on an as needed basis. In this case, a fixed percent increase is applied to the current salary structure to keep the structure up to date until it is repriced. Typically, a salary increase budget survey will also report on the market competitive salary structure adjustment percentage from one year to the next.

Example

In most countries, the salary structure percent movement is commonly 1% below the average salary increase budget. In this case, the example salary range has been increased by 2% from 2024 to 2025.