Bianca Walsh· Job Architecture Lead, Pinehurst Foods
Asked in Compensation ·
Our consultants have proposed replacing grade midpoints with a market reference point for each job. I am at a medical devices company in Germany with about 2,000 employees and 14 grades.
As far as I can tell, the reference point would be the market median for each benchmark job, and the range would be 80–120% around it. We already set midpoints from the median of the benchmark jobs in each grade.
What does a company actually gain from the change, other than several hundred reference points to maintain in place of 14 midpoints? Has anyone gone this way and stayed with it?
7 helpful · 3 insightful · 1 agree · 5 replies · 216 views · 3 following
Nina VargasGRS
Global Mobility Manager, Steinbach Industrie
The gain is for jobs that sit badly in their grade. In a grade structure, a tax specialist and a facilities lead share a midpoint even if their markets differ by 15%. Job-based reference points let each be paid against its own market without inventing a premium or a regrade.
The cost is exactly what you say: maintenance, and far more questions from employees who compare reference points.
Tessa IversenCBS, CEP
Compensation Manager, Lumen Biosciences
We went to reference points and came halfway back. Now it is grades with three market tracks per grade: general, technical and commercial. Forty-two midpoints, not several hundred, and it covers 90% of the cases where the single midpoint was wrong.
Victor PereiraCBS, GRS
Sales Compensation Manager, Qasr Holdings
With a works council I would think hard before going job by job. Ours wanted to understand and agree the placement of every job in the structure. Fourteen grades was a negotiation. Three hundred reference points would have been a permanent one.
Benefits Manager, Steinbach Industrie
How many of your jobs are benchmarked directly? If it is under 60%, the rest will need a reference point derived by slotting, and at that point you have rebuilt grades without admitting it.
Tessa IversenCBS, CEP
Compensation Manager, Lumen Biosciences
About 55% are direct benchmarks, so that last point lands. I am going to test the market-tracks idea against our data before the next meeting. If two or three tracks explain most of the variation within a grade, I see no case for the full job-based model.
