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SHRM Case: “Designing A Pay Structure

SHRM Case: “Designing A Pay Structure

Your case analysis should consist of:

 Task A: Create a complete job description for the benefits manager position using

O*NET.

 Task B: Calculate the job evaluation points for the Front Desk Receptionist and benefits

manager jobs. Provide a rationale for assigning specific degrees to the various jobs.

 Task C: If there were any outliers (i.e., extreme data points) in the data, what would you

recommend doing with them? From this point forward, assume no extreme data points

exist in the dataset.

 Task D: Conduct a simple regression in Excel to create a market pay line by entering the

job evaluation points (on the X axis) and the respective weighted average market base

pay (on the Y axis) for each benchmark job.

 Task E: What is your R squared (variance explained)? Is it sufficient to proceed?

 Task F: Calculate the predicted base pay for each benchmark job.

 Task G: Because your company wants to lead in base pay by 3%, adjust the predicted

pay rates to determine the base pay rate you will offer for each benchmark job.

 Task H: Create pay grades by combining any benchmark jobs that are substantially

comparable for pay purposes. Clearly label your pay grades and explain why you

combined any benchmark jobs to form a grade.

 Task I: Use your answer to Task H to determine the pay range (i.e., minimum and

maximum) for each pay grade.

 Task J: Given the pay structure you have generated, consider the following: Does this

pay structure make good business sense? Do you think it is consistent with the

organization’s business strategy? What are the implications of this pay structure for other

HR systems, such as retention and recruiting?

 Your analysis of this case and your written submission should reflect an understanding of

the critical issues of the case, integrating the material covered in the text, and present

concise and well-reasoned justifications for the stance that you take. You are to complete

this case analysis using Excel in a spreadsheet analysis format.


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