Small businesses have often been accused as being unstructured as far as pay scales are concerned.
Here are a few tips to structuring a pay scale that suits the short hierarchy of your organization. First step is to choose a pay philosophy. Will it be skill-based or competency-based, broadband pay or variable pay.
Next is to create job descriptions and then designations for them. Third is to match the pay scale for this job with that of the industry norms. Establish a range using the survey ranges as the base. Prepare a performance measurement system for appraisals and increments.
Keep hikes proportional to the inflation rate to keep the productive employees happy.