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Internal Equity

It means that there should be proper relationship between the wages and salaries of various positions within the enterprise. The Problem of pay inequities is job evaluation.

External Competitiveness

To achieve external alignment the management must first know what the average rates of its key job are prevailing in the community. Most of the companies buy salary survey reports from external vendors such as Mercer, Hay, SNEF, etc

Performance based payment

In the final step, management has to decide whether all individuals in jobs of the same level should be paid the same pay or different pay and how this should be determined.

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12y ago

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