Arriving at the Mid-Point Progression

Introduction

The following are the design considerations in the development of a salary structure:

  • Number of salary structures
  • Pay policy line
  • Number of salary grades
  • Midpoint-to-midpoint differentials
  • Salary range spreads
  • Salary range overlaps

Source: Watson Wyatt

Illustrative Steps

In their paper Base Pay Structures: How to Design an Accurate and Effective Compensation Foundation written for the Center for Competitive Management, Doug Sayed and Peter Scontrino has listed the following 4 steps in building a salary structure. It gives us an opportunity to see how the mid-point progression fits into these steps.

Salary Formula 35A

Salary Formula 35B

Salary Formula 35C

Salary Formula 35D

Here is an example published by Keith Fortier and Christopher J.Fusco in their paper Salary Structures published in salary.com website

Salary Formula 35E

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