AIHR Boot Camps are intensive HR training programs designed to rapidly upskill small cohorts, blending self-paced, specialized content with instructor-led, practical sessions, all guided by a program manager to ensure progress and impact.
Learn moreWhat is a remuneration committee? A remuneration committee is a group within an organization (typically a board committee) responsible for determining the compensation and benefits of the company’s executives, including the CEO and other senior management. This committee ensures executive pay aligns with the company’s performance, strategic objectives, and shareholder interests. The remuneration committee plays…
What is gainsharing? Gainsharing aims to increase company profitability by seeking higher levels of participation and employee performance. Employees receive a financial share of the profit of the company gained by a performance improvement they helped design. Gainsharing aims to eliminate waste in processes and motivate employees to work hard. It’s a group-based initiative in…
What is merit pay? Merit pay is a compensation approach that gives employees an increase in their base salary or provides bonuses based on their performance. Employers use it to ensure they are rewarding their best-performing employees. Merit pay can take the form of a merit increase in salary, commission, or bonuses. How does merit…
What is pay mix? Pay mix refers to the ratio of fixed pay to variable pay in an employee’s compensation. A pay mix ratio is typically used in sales departments to motivate employees to reach or exceed their targets. The usual ratios are 60:40, 70:30, and 75:25. A 60:40 pay mix means 60% of the…
What is fixed pay? Fixed pay, or fixed salary, is the predefined and fixed amount paid to an employee by the employer at the end of every payroll cycle. Fixed pay includes all remuneration guaranteed by the company, most commonly in the form of a monthly or annual salary. Additional contributions to things like medical…
What is competency-based pay? An organization that uses competency-based pay structures compensates employees based on their obtained skills and competencies in the workplace, compared to traditional pay structures, which compensate employees based on job title, seniority, or position. This approach encourages employees to improve their skills and knowledge. It is usually used in fields that…
What is a merit increase? A merit increase is any salary increase awarded to an employee to reward exceptional performance and contributions toward achieving organizational goals. Some organizations give a merit increase on an annual basis, whereas others give a merit increase in direct response to great performance. Eligibility to receive a merit salary increase…
What is range maximum in compensation? Range maximum is the highest rate you are willing to pay for a role. The range maximum can be reflected as a fixed amount or as a ratio between the range minimum and range maximum. There are various reasons an employee could be paid at the maximum of the…
What is range spread in HR? A range spread is the range of pay established by employers to compensate employees for performing their job. It includes a minimum, maximum, and mid-range pay rate. For example, the range for a particular position can have a minimum of $45,000 and a maximum of $60,000: Minimum Range midpoint…
What are geographic pay differentials? Geographic pay differential refers to pay at a different rate for similar jobs based on the location. Geographic location, in this instance, refers to cities, states, countries, territories, etc. The premise of geographic pay differential is based on the cost of living, market rates, and various other factors. For example,…
