Pay Survey Practices - Part II

1
Pay Survey Practices - Part II

• Measuring Pay Data
• Distributions
• Normal - Bell shaped curve - rarely appropriate
• Non-Normal - pay data is unevenly distributed
  more typical of pay data collected from surveys
• Measures of Central Tendency used to report Pay
• Median - the middle value of an ordered sequence
  of data
• Mean - sum of data divided by number of
  observations
• Unweighted - each company is an observation
• Weighted - each employee is an observation

2
Pay Survey Practices - Part II

• Measures of Variation used to Report Pay
• Range of Pay Data
• Minumum, Maximum, Midpoint
• Quartertile - 1st , 2nd (above midpoint) 3rd,
  4th (below )
• Standard Deviation - distance of data from mean
  in a normal distribution.
• Typical Market positions
• Lead the market
• Lag the Market
• Match the Market

3
Pay Practices - Part II(Gomez-Mejia Balkin,
1992)

• Recommended Pay Survey Practices
• Relevance
• Match on Job Descriptions (not Titles)
• Consistent Use of Same Statistical Measures
• Keep Pay Data Current
• Monitor Effectiveness Using HR Benchmarks