Pay review

To maintain and develop an adequate salary structure, organisations should conduct an annual pay review for all workers. Much of the information that is brought to bear on setting salaries in the first place will come into this review. Other factors that may warrant a change in salary are:

Change in duties

Have the worker's duties and responsibilities changed significantly in the period since the last review? Any significant changes in work patterns, hours etc. should be taken into account when adjusting pay. Job descriptions should also be adjusted when necessary.

Cost of living

Has the cost of living increased significantly since the last review?

Performance

A number of organisations link salary increases directly to performance. In these cases, the worker will be awarded higher pay when he or she has met pre-agreed performance targets or objectives. Such targets may include concrete achievements - such as lowering the operating costs in a certain area - or may involve demonstrating competence in a new area, such as the use of information technology. 

Employers should ensure that equality of opportunity is maintained and that clear and transparent processes are in place that justify any decisions relating to performance.

Set increments

Some organisations may choose to create fixed levels of pay based on time in service. This is a traditional method where pay is determined largely by seniority. Many organisations are finding this method fails to motivate workers or attract the quality of staff needed.

Reviewed and updated by the HR Services Partnership - April 2010.

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