OECD Observer

Saturday, 25 September 2010

Pay and grading

I don't quite agree with the pay and grading business where people try to "standardise" pay and grading scheme because they assume that most jobs are the same and most people doing similar jobs always do the same thing, to the same standard and therefore should be herded into categories.

In the normal world through, people are all different. Managers take responsibility for deciding who is worth what. It is part of what they are paid to do - to recruit people, retain them using reward system commensurate to their ability, skills and output. HERA doesn't care about that. They think managers cannot be trusted to do such job.

In a way, this eliminates the biases, prejudices and disparities. In another, you create frustration - in managers because they are not allowed to reward their outstanding subordinates outside of these pay structures and in workers because they know that they can never progress. The fixed pay and fixed grades demotivate workers by ingraining in them that however much they contribute, they will always be rewarded according to the structure anyway so there is little incentive to put in any extra

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