Job-based and Skill-based Pay Plans for Employees
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Job-based And Skill-based Pay Plans
Job-based remuneration system and skill-based pay system are examples of payment systems that can be used by firms to pay their employees. Workers can be paid based on the jobs they are allocated or based on evaluated skills they possess. Job-based plan pays employees for the jobs assigned to them regardless of their skills or knowledge. Skill-based plan, on the other hand, take into consideration the skills, knowledge and ability relevant to the work a person is assigned. Employees paid under skill-based plan are paid depending on all the skills and knowledge they possess regardless of the job requirements.
Job-based systems majors on what will be offered for the same job elsewhere, where sector players serve as a benchmark for comparison and determination of the pay. Companies may also dictate the payment on what they can offer for the job performed by its employees. Firms tend to focus their pay on their performance and align payment with their company strategy. Skill-base plan focuses on the depth and breadth of the competency of an employee and is applicable to the blue-collar job systems.
Most civil servants in governments and mostly in less developed countries are paid based on their skills other than the job. The designs of cadres are based on the level of both skills and knowledge a person garners throughout his/her career and education that places them in top positions with better pay. This compensation scheme can be said to achieve the desired outcomes and at the same time it does not achieve some targets. People tend to focus on getting papers and extending their work periods to be deemed fit for promotion or better pay other than gaining technical and practical skills relevant to the jobs they are contracted to do.