Wage Structures and Wage Comparisons

Wage Structures and Wage Comparisons “Fair pay” is generally regarded as one of the main objectives of wage and salary administration in organisations. It is also becoming more widely appreciated that government incomes policies are unlikely to succeed until they can alter the anomalies and distortions which exist between the wages of different occupations or sectors of employment. If organisations or governments are to move in the direction of fairer pay then they must understand wage structures and the wage comparisons which such structures give rise to. The purpose of this paper is to describe a set of methods for aiding this task. Without methods of analysing complex wage structures, organisations and governments lack the capability of moving in the direction of fairer pay. This paper is therefore about the establishment of a capability for policy making, and the concluding section will briefly suggest how policy might be improved with the aid of this capability.