Market Pay Line a Means of Interpreting Surveys
Market Pay Line a Means of Interpreting Surveys
In formulating and administering organizational compensation structure, there are several goals and objectives. Most companies desire to avoid inappropriate pay expenses which could have an adverse effect on profits. In addition organizations do not want to pay too little to avoid expensive employee turnover and training. The process of surveying if accomplished with a high level of integrity can result in an equitable pay plan. “My lips shall not speak wickedness, nor my tongue utter deceit (Job 27:4). Many organizations utilize various survey methodologies in order to assist in determining what pay structure is best suited for the organization at a specific time. Surveys can appear in many complex forms and formats. Some reports will extensively slice and dice the data provided; some surveys will utilize a minimalist position. A good pay survey will return some information on everything collected, consistent with the quality and quantity of data received (Berger & Rock, 1991).
With the complexity and ambiguity of survey results, many organizations interpret the results by utilizing complex statistical data processing mechanisms. The methodology of interpreting pay survey results differ among organizations. Organization will generally apply a unique set of parameters and methods in interpreting the pay survey results. Once the pay survey data is extrapolated and interpreted and it contains results of outliers or non-benchmarked positions the data could be better reviewed and evaluated by establishing a “market pay line”. “After the survey data are all collected, the next step is to analyze the results and use statistics to construct a market pay line” (Gerhart, Milkovich, & Newman, 2011, p. 253).
The market pay line will assist in setting a pay scale for non-benchmarked positions this is accomplished by statistically comparing the...