Page 232 - Personnel Policy and Procedures Manual

Pay Adjustment - A general revision of pay raises. The adjustment may be either across-the-board,
such as cost-of-living adjustments (COLA), or spot adjustments for increases in prevailing wage rates.

Pay Grade- A salary range with a minimum, midpoint, and maximum pay bracket established to fairly
and competitively compensate an employee for assigned work under the specific job classification.

Pay Plan - A schedule of pay rates or ranges for each job in the classification plan. May include rules
of administration and the benefit package.

Pay Policy Line - The level at which the organization decides to set its pay against the external market;
usually the midpoint of the salary structure is set as an estimate of the market going rate.

Pay Range - The range of pay rates, from minimum to maximum, established for a pay grade or
class. Typically used to set individual employee pay rates.

Pay Range Overlap - The degree to which the pay ranges assigned to adjacent grades in a structure
overlap. Numerically, the percentage of overlap between two adjacent pay ranges.

Pay Range Width - The width or spread of a pay range, measured by the ratio - Width = (maximum
pay - minimum pay)/minimum pay.

Pay Rate - A specific dollar amount, expressed either as an annual rate, a monthly rate, a semi-monthly
rate, a bi-weekly rate, or an hourly rate, that comprises each pay grade as shown in the pay plan.

Pay Steps - Specified levels within a pay range. Employees may progress from step to step on the
basis of time-in-grade.

Pay Survey - The gathering of data on wages and salaries paid by other employers for selected key
classes of jobs or benchmark jobs.

Performance Appraisal - Any system of determining how well an individual employee has
performed during a period of time, frequently used as a basis for determining merit increases.

Performance Evaluation -The method of evaluating each employee on an annual basis as to his or
her performance on the job during the evaluation period.

Performance Increase - Salary increase based on job performance.

Permanent Downward Transfer - A permanent transfer of an employee in one salary grade to
another salary grade that has a lower pay range maximum.

Person-based Pay - Compensation programs that base an employee's salary on that individual's skills
or knowledge rather than on the nature of a rigidly defined job. Types include skill-, knowledge-, and
competency-based pay.

Position - The total of duties and responsibilities of a single employee. The total number of positions
in an organization equals the number of employees plus vacancies. A job is typically made up of
several positions that require the same duties at the same level.

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