The Advantages and Disadvantages of Broad Banding in the Workplace Essay

According to a WorldatWork journal article, broad banding is astrategy that human resources use to consolidate a large number of lowergrade bands into a less number of grade bands with larger salary rangesthat will provide employees with opportunities of promotions andadvancement within an organization (Enos Limoges 2000). This band is broader than the traditional salary structure. Atraditional salary band has a difference of 40 percent between the minimumand maximum pay than broad banding, which would be a 100 percentdifference. According to an article in payscale.com, "creating large bandsis done as a measure to support restructuring in a company by combining joblevels or grades" (www.payscale.com, 2011) This assignment will demonstratethe advantages and disadvantages of broad banding and to determine if broadbanding is competitive in the work environment. Advantages to Broad Banding According to a journal article in WorldatWork the characteristics ofbroad bands are " typically designed with range spreads of 80 percent to120 percent or more and midpoint differentials of 20 percent to 25 percent,are salary structures with a series of relatively few wide bands, whichencompass all of the organization's jobs" (Stoskopf, 2002). Therefore,broad banding is flexible in placing a particular group of jobs withsimilar responsibilities but a difference in the market rates within thesame band. This eliminates the focus on job grades and structures it soorganizations can move incumbents between different jobs within theorganization with fewer concerns that result moving as lateral or to alower position, which increases the focus on skills and career development. Broad bands also increase the organizations ability to compete with marketrates and match pay based on individual performance and skill to reflectthe various levels of competency development within the same group ofbands. It...

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