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09 eLMS Review

The document discusses human resource management topics. It begins by explaining that the preferred salary structure is a market-based structure because it combines elements of traditional and broadband structures. Market-based structures set wide salary ranges that are restricted and stable like broadband structures. However, relying too heavily on market data can cause problems with competitive pay, career development, and budget management. The document then provides an example of broadbanding, explaining that broadbanding sets broad salary bands around a midpoint, with the lower end being 80% of the midpoint and the upper end being 200% of the midpoint.

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Claire Aira Lumanglas
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632 views1 page

09 eLMS Review

The document discusses human resource management topics. It begins by explaining that the preferred salary structure is a market-based structure because it combines elements of traditional and broadband structures. Market-based structures set wide salary ranges that are restricted and stable like broadband structures. However, relying too heavily on market data can cause problems with competitive pay, career development, and budget management. The document then provides an example of broadbanding, explaining that broadbanding sets broad salary bands around a midpoint, with the lower end being 80% of the midpoint and the upper end being 200% of the midpoint.

Uploaded by

Claire Aira Lumanglas
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
  • 09 eLMS Review: This section discusses different salary structures, their advantages, and how to choose a preferred structure. It also includes an example to explain broad banding in salary design.

Human Resource Management

09 eLMS Review

1. Choose your most preferred salary structure and explain your reason.

The market-based salary structure is my preferred salary structure. We've seen


an increase in the use of market-based structures over traditional structures. Market-based
structures have captured my interest because they combine the more well-defined
parameters of a traditional structure with the range spread flexibility of broad bands. Market-
based compensation structures combine traditional and broadband salary systems in some
aspects. Salary ranges can be wide, although they're usually restricted and stable, like in
broadband structures. It is my opinion that a large portion of organizations rely on that data
too heavily, unaware of the problems with the data. Organizations that use a pure-market-
based salary structure will see these problems permeate through their ability to pay
competitive wages, develop meaningful career paths and manage their human capital
budgets year-over-year.

2. Provide an example that will explain broadbanding.

Businesses that base employee pay on skills and experience rather than
performance frequently use broad banding to determine salary bands. Flat hierarchies, or
businesses with only a few managers overseeing a large number of employees, are also
common users of broad banding. This is due to the fact that these companies frequently
have fewer job levels for which they must determine a pay range.

 Typically, a business bases a broad salary band around a salary midpoint. The band's
range usually starts somewhere below this, often at 80% of the salary midpoint. The top
end of the range can go as high as 200% of the salary midpoint. For example, if you set
a band's salary midpoint at P100,000 per year, the low end might be P80,000 per year
(80%) and the top end might be P200,000 per year (200%).

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