Developing a Pay Structure | Human Resources Management

(lumenlearning.com)

The Carter Cleaning Company – The

New Pay Plan
HRM Assignment:
SUBMITTED BY Kunal Patel- 21BSP0080

Is the company at the point where it should be setting up a formal salary structure based?
on a complete job evaluation? Why?

Yes, by setting up a formal salary structure is being fair to the employees because the salary being
paid based on the job task rather than pay the salary based on gender. When the salary structure
being fair, it leads satisfaction among the employees and as a result the turnover will be at low rate.
Besides, the company also can control their financial operation by doing budget allocation planning
for their business operation.
Moreover, the formal salary structure will make the employees clear on the amount pay for his or
her job position. Thus, it can make easier to the related manager to do a process of salary payment.

Is Jack Carter's policy of paying 10% more than the prevailing rates a sound one, and
how could that be determined?
First and foremost, Carter does not conduct official polls in this situation, which is a proper decision.
Carter should give greater consideration to employee needs while developing a formal
compensation policy.
Second, rather of paying the same salary for all work departments, Carter Company should pay
varied rates for distinct job departments gender. Finally, job evaluation may be used to determine
the relative worth of a position. Jake, on the other hand, has none.
sufficient evidence for establishing a pay policy Carter, in our opinion, may choose for a job
assessment committed to ensuring that the appropriate compensation rules are in place.

Jake Carter's strategy of paying 10% more than the current rates, in our opinion, is reasonable.
Making a sensible pay plan may be broken down into five phases. The majority of the time, the
employer undertakes informal pay negotiations.
Employers mostly perform informal and formal compensation surveys. Employers then conduct
compensation surveys to learn what others are paying.
Second, Carter selects job appraisal methodologies to determine a job's worth. Finally, the
For similar occupations, the organisation offers a similar compensation. Fourth, Carter can utilise a
salary curve to assist in the assignment of jobs.
salary scales for each position Then a salary curve makes it simple to price employment. Finally, we
know Carter isn't one of them.
Create a salary scale. As a result, setting compensation ranges to reward high performance is critical
employees.
Carter must also fix out-of-line rates at the same time. In this scenario, we disagree that men and
women are the same for practically the same task, men and women get compensated similarly. Jack
Carter's approach of paying 10% more than the going rate is sound because he believes that by
paying more, he would be able to limit turnover.
Employee loyalty to the business may be cultivated through creating a positive work environment
for employees. It might be determined by producing evidence that Jack pays the worker 10% extra.
It's also incredibly convenient Much better if the payment is made to the employees who
demonstrate devotion to the company.

Similarly, is Carter's male-female differential wise? If not, why not?

In our perspective, the answer is no; Carter's does not have a male-female disparity in terms of
pricing. They are also on the same level as their employees. Carter Cleaning Centres' failure to
provide a formal and legal pay structure to their employees, as well as their failure to provide a
decent compensable factor to their employees, will have negative consequences for their employees
and result in different treatment. Wage rates are mostly determined by those in the local
neighbourhood.

The Equal Pay Act of 1963 mandates that men and women who work in similar jobs be paid equally.

The salary for jobs in the same company should be the same. The term 'same pay' refers to no
difference is acceptable. In addition, the law, also defines that one
consider as doing the same level of job if they are equal in term of skills, effort, responsibility and
working condition. However, the Equal Pay Act of 1963 includes four exceptions that allow
employers to pay another gender more than another. Some of those exceptions are like more
seniority, better job performance, greater quantity or quality of production and lastly certain other
factors like paying extra to employees that working the night shift.

Back to this case study, there is no such exceptions includes in the reason provided by the Jack as to
justify why he decided to pay 20% more than woman to men workers. The reason provided by him is
they are stronger and can work hard for longer hours and also, they all have family to support. This
justification is the one that can't be acceptable at all if refer to the law and it also show
discrimination towards the female worker. This is because, according to Equal Pay Act 1963, rather
than the four exceptions as mention above, female and male workers should receive the same
amount of payment if they hold the same job that are substantially equal.

In addition, this unwise decision of Jack Carter's policy will result in many negative effects such as
increase in turnover among female worker, job dissatisfaction. Besides, there will be also more
arguments in order to get an equal pay rate and lastly it will lead to an unproductively result too the
animation.

Specifically, what would you suggest Jennifer do now with respect to her company's pay
plan?
For the development of the company, there are several suggestions from us to Jennifer do now with
respect to her company's pay plan. More details about the suggestion will be discussed in the
following paragraph.
First, in the question 1, we had mentioned this point, setting up a formal salary structure. Based on
this point, for the employees, they will feel fairer and more unambiguous about how much they can
get and it also makes the managing easier and more clearly for managers, there are strict certain
structure to avoid the unfair things happen.

Second, make a necessary formal survey in order to determining the amount that company should
pay at what type of job responsibilities in order to avoid the mistake such as imbalances of salary
payment.
No matter what careful we are, we also would make some errors, so recheck the results are very
necessary and important. In the case, the company conducts informal surveys among friends and
cleaners trade associates. By doing this, it would reduce the cost and it is good for getting vast and
direct information. But the independent information source could give great risks to the company in
the future. Therefore, a formal survey to the employees is more effective rather than informal
survey in er to get feedbacks from employees regarding the pay system.

Third, about the policy of paying 10% more than the prevailing rates, as a company, profit is the first
thing. Although, this policy can foster employee loyalty, but to the long-term, the employees will
accustom this situation and cannot motivated them to do better. Changing the policy like rewarding
the outstanding employees with this policy, not all, this not only can reduce the cost, but also can
motivate employees to get the higher prevailing rates.

Fourth, abolish the policy of paying men about 20% more than women for the same job. Although
her fathers explained that men are stronger and can work harder for longer hours, and besides they
all have families to support, this policy considered bias to the men employees and of course it can
course dissatisfaction to the women employees and they will feel unfairly treated. In pay system, it is
better to have an official approved procedure on determining the right employees who's qualify to
be rewarded on the bonuses or salary increment and it should be based on the employee’s work
performance. Don't do like that, regarding somebody who work hard and better is effective method.