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Internal parity among employees is a major issue, and
one that an external salary has limited influence upon.
If I'm trying to hire a new employee and the salary the
preferred candidate requires is significantly higher
than that of the existing employee, there will be little
I can do to raise the range, regardless of what any
survey may say is market competitive. That is why
one of the first things I do if I take over management
of an existing department is review the salaries of
the current staff against any market data I have access
to, and if they are lower than what I conclude is market
competitive work on bringing them up before spinning
my wheels trying to recruit new people I know I won't
be able to offer enough to hire. That's where I found
the old survey useful.
I doubt very much that anyone has ever successfully
used data that showed their company paid its employees
less than the market but on an internally consistent
basis to prove anything other than that the company
was cheap. It's just that in some cases (for example,
govt contracts where the contract requires market
rates to be paid), proving that the company is cheap
may be enough.
> In today's litigious society, the prudent HR guy does take salary survey
> information into account. Any worker that feels underpaid can sue to force
> HR to reveal pay equivalency within the company. This is especially true if
> the company does any work for the federal or state government. Most states
> and the US gov requires 'contractors' to pay at the local scale for
> equivalent tasks. I've seen this successfully contested in the courts as
> well as having the Dept of Labor force a gov contractor to give back-pay to
> someone that was not paid at the published local scale for a particular
> task. For example if they are doing Tech Writer IV tasks, but paid at a Tech
> Writer II rate.
> -- Systemic compensation discrimination exists where there are statistically
> significant compensation disparities (as established by a regression
> analysis) between similarly situated employees--
> Interpretative Standards for Systemic Compensation Discrimination (71 FR
> 35124, June 16, 2006)
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