Step 4:
Standardize Jobs and Pay

An illustration showing laptop screens and documents of job descriptions and salary ranges.

From Job Descriptions to Pay Structures

Are your job descriptions up to date? What data do you collect to ensure you are setting fair and competitive ranges?

Achieving pay equity requires a structured approach to evaluating roles, setting compensation ranges, and regularly reviewing pay practices to identify and address potential disparities. We boil down a method to standardizing jobs and pay in three parts below.

01

Use a Job Analysis to Refresh Job Descriptions

Outdated job descriptions hinder your ability to attract qualified candidates. A job analysis provides a clear picture of your current roles by identifying:

Essential Responsibilities: What tasks are truly necessary for each position?
Required Qualifications: What skills, knowledge, and experience are required for success? Is the role external facing or internal? How much supervision is required?
Work Environment: What are the physical and logistical conditions employees face on the job? What equipment are employees required to use?
Job Importance: How does each role contribute to the overall workflow and company goals?

02

Evaluate Jobs to Set Up Your Job Architecture

Once you have a clear understanding of each role, you are ready to compare jobs against each other to understand their similarities and differences. This process allows you to establish a job architecture (also known as a job hierarchy) which categorizes jobs into groups. Your job architecture could be set up in various ways, depending on your organization size and complexity. Some examples are:

Job ranking: Place jobs in a hierarchy based on their value to the company. Simplest method, but not ideal for large organizations or complex job structures.
Point factor: Break down jobs into factors, assign points, and use them to build a pay structure.
Factor comparison: Combine the ranking and point methods. Use benchmark jobs and market rates to assign monetary values to factors.

Job classification: Group similar jobs into predefined categories based on skill and complexity.

03

Design an Updated Pay Structure

Once your job architecture is in place, it's time to establish narrow, competitive pay ranges for each role. This step involves:

Market research: Analyze market data to understand typical compensation packages for similar positions in your geographic location and industry. Resources like salary surveys, online databases, and industry reports can be valuable tools.
Internal equity: Ensure fair and consistent pay within your organization by comparing the relative value of each role determined through the job architecture.
Legal compliance: Always adhere to relevant legal requirements such as state and federal minimum wage laws, overtime regulations, and equal pay laws.

Considering these factors can help you establish well-researched, market-driven pay ranges that attract and retain top talent.

Strategies from California Employers

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Beginner

Use employee surveys to conduct a job analysis. This data will help you to find the right employees for each job and comply with pay equity laws by empowering you to follow the 3-part guide in the section above.

What might this look like? Imagine a local hotel conducts a job analysis and finds that its janitors primarily perform cleaning and light maintenance duties in the hotel's common areas, while housekeepers primarily perform cleaning and light maintenance duties in hotel rooms. The hotel owner combines these jobs into one job group with the same pay range, despite the differing job titles.

Advanced

Create guidelines for how to assign employees within each pay range. Share with hiring managers the pay ranges of recent offers for comparable jobs that were accepted

What might this look like? Imagine a law firm creates narrow pay ranges for law firm associates. The firm creates a second tier of review for job offers with any extraordinary compensation and notices recruiters are incentivized to stick to the standard range to avoid triggering another layer of review.

Intermediate

Consider a no-negotiation policy for compensation. If your organization allows negotiations within pay ranges, consider a less adversarial setting for more equitable results. Or consider allowing spot bonuses to be negotiated, but not base pay so that negotiation skills do not impact an employee’s pay trajectory.

What might this look like? Imagine a statewide advocacy organization gathers background information on market trends in their region by collecting industry benchmark reports. The organization uses the data to establish narrow, slightly above market pay ranges, and adheres to a no-negotiation strategy for compensation.

Useful resources we've found for updating job descriptions, job evaluation guides, and compensation frameworks.

Tools for Job Analysis, Job Evaluations, and Job Architecture

Job Description Templates and More by LinkedIn: A guide that includes interview questions, job description templates, and other resources to help with your hiring efforts.

O*NET Online: O*NET is a database with detailed job definitions and position descriptions of over 900+ occupations, sponsored by the U.S. Department of Labor.

Step-by-Step Job Evaluation Template by the California Commission on the Status of Women and Girls: Step 1 of this evaluation template provides helpful examples of what may constitute “substantially similar work".

'How Individuals Advance at Buffer, Without Becoming Managers' by Buffer: An article that describes one company's effort to create a formal career framework that includes growth opportunities beyond the traditional management track.

Tools for Designing Pay Structures and Compensation Frameworks

Living Wage Calculator by MIT: A tool to estimate the local wage rate that a full-time worker requires to cover the costs of their family’s basic needs where they live.

Guide on Compensating Fairly as a Start-Up Scales: A framework from the lens of a start-up to compensating fairly, advocating for a no-negotiation policy for compensation.