While recently conducting a custom compensation market survey, I was asked the question – ‘What is a Job Rate’?   In my custom survey I asked for data on actual salaries, as well as the Job Rate of the salary structure.

Actual salaries are considered to be the specific wage rate or annual salary that each employee receives for doing an assigned job.  It is part of their base pay package vs. variable pay package.

A Job Rate, on the other hand, is normally referred to as either the midpoint in the salary range of a merit-based pay system, or the maximum rate of pay in a seniority or step-based pay system.  Overall, Job Rate is what a company would normally expect to pay an employee who is performing all of the duties of a job in a satisfactory manner.

It is important to know the difference in order to ensure that your pay analyses effectively identify variations with external market conditions.  I would recommend to use actual salaries when determining where your organization exists within its marketplace.  Comparing the Job Rates of your salary structure to other salary structures will give you an idea whether the design of your Compensation Program is strategically placed within your market in order to attract highly competent employees.

For more information on this topic, please contact Pat Allinson at pallinson@hrcompensation.ca or call (416) 587-5453.