How to create a salary scale for your company (+ example)
The salary grid is much more than just a table. It is a strategic tool for ensuring fair and transparent remuneration within the company. At a time when pay expectations are constantly changing and legislation is imposing constraints, it is essential to master the art of drawing up a pay scale.
And why is that? Because a well-designed pay scale helps to retain talent and ensures compliance with legal obligations. But that's not all! It will also enable you to structure salaries according to precise criteria: skills, seniority and market conditions.
In this article, you'll find out everything you need to know about setting up an effective pay scale tailored to your sector. You'll find the steps to follow when structuring a pay scale, as well as tips on how to get the most out of it. Ready to boost fairness and commitment in your company?
What is a pay grid?
Definition of a pay grid
A salary scale is a structured table that defines the remuneration applicable to employees according to several criteria, such as the position held, status, step or hierarchical coefficient. Generally, the pay scale is set either by the sector's collective agreement or directly by the employer.
Each pay scale sets out pay levels, often expressed as minimum and maximum values, according to the categories defined. The main aim is to provide a transparent and fair framework for setting wages. This ensures internal consistency and limits unjustified pay differentials between employees.
Structure of a pay scale
The structure of the pay scale is based on a system of levels or steps, associated with coefficients that indicate the importance of each position in the organisation. These coefficients determine pay bands, making it possible to classify different roles clearly and precisely.
🧑⚖️ In France, the use of a pay scale is not required by law, but it is often required by the collective agreements that govern working conditions in certain sectors. This means that, although employers have a certain amount of freedom to define their own pay scale, they must comply with the minimum values set by legislation and collective agreements.
What is the purpose of a pay scale? Objectives
A pay scale sets salaries on the basis of clear, objective criteria. It provides a transparent framework, reduces subjective decisions and limits the risk of discrimination.
It is also a strategic human resources tool. It provides employees with a clear vision of their salary progression and development prospects. They know what to expect in terms of future increases.
For the company, the salary grid simplifies budget management. It clarifies salaries for each position, helping to optimise human resources expenditure.
Finally, by harmonising salaries for comparable functions, the salary grid enhances transparency. In this way, it fosters a calm social climate that is conducive to retaining talent.
Salary scales and the Labour Code: what does the law say?
In France, a pay scale is not compulsory under the Labour Code, but it is often governed by collective agreements, which set minimum wages by job category. In addition, the pay scale must comply with the SMIC (salaire minimum interprofessionnel de croissance), which guarantees a legal pay threshold for all employees.
The Labour Code also requires compliance with equal pay: for jobs of equivalent value, salaries must be identical. A well-designed pay scale therefore helps to ensure legal compliance, by respecting the minimum levels and reducing the risk of pay discrimination.
The key benefits of a company pay scale
Adopting a pay scale guarantees a number of benefits:
- Fairness and transparency: by defining precise criteria for pay, the pay scale reduces the risk of discrimination and builds trust.
- Easier negotiations: salary bands simplify discussions, whether on recruitment or during appraisals.
- Neutrality in recruitment: a salary scale reduces bias, particularly in terms of the gender gap, for fairer recruitment.
- Loyalty and motivation: the pay scale strengthens employee motivation and recognition, while encouraging retention.
- Legal compliance: it guarantees compliance with legal and collective bargaining obligations in terms of pay, with salaries in line with the scales imposed.
- Support for forward-looking management of jobs and skills (GPEC): as part of GPEC, the pay scale helps to anticipate staffing needs and develop essential skills.
In short, a pay scale does more than just manage salaries. It is a pillar of HR strategy, promoting a motivating, stable and competitive environment. A must for the company! 💪
Where and how can I find the pay scales?
Accessing pay grids is crucial to properly aligning the company's remuneration policy. Here's where you can find them and how to use them:
- Collective agreements: collective agreements are key sources for information on minimum wages in a sector. They often specify pay scales according to job category and level of qualification.
- Human resources department: within the company, the HR department generally holds the pay scales. It can also provide explanations of how salaries are structured. 🤓
- Professional websites: several online platforms offer salary databases to compare pay by sector and by position. These tools offer an overview of current market trends.
- Company intranet: in organisations that value transparency, salary tables are often accessible via the intranet. This gives all employees access to this essential information.
- Contractual documents: employment contracts and pay slips sometimes mention the employee's level or step. These documents are a direct source for checking that the salary corresponds to the pay scale.
How do you create a salary scale?
1- Select the basic elements of a pay scale
Diploma and skills
The first elements to consider are qualifications and skills. The level of training required for each position, as well as specific qualifications and skills, play a decisive role in assessing pay. This is the basis for aligning pay with job requirements.
Professional experience and seniority
The employee's professional experience and seniority represent another fundamental pillar. In fact, solid experience can justify a higher level of remuneration, as it reflects in-depth knowledge of working practices and the working environment.
Professional category
In a company, each position is assigned to a professional category: manager, technician, administrative employee, etc. Each category is often associated with specific coefficients. Each category is often associated with specific pay coefficients, which define appropriate pay bands.
This category system is based on the salary coefficient, which assesses the role of each position in achieving the company's objectives. The greater the responsibilities, the higher the coefficient, and therefore the salary.
The labour market
Finally, market conditions and inflation are unavoidable factors. The economic context of the business sector influences remuneration decisions, enabling the company to remain competitive and guarantee the purchasing power of its employees.
📍Certain more specific criteria can also be added, such as geographical location or company-specific parameters, to tailor the pay scale to the organisation's overall strategy.
☝️ By taking all these elements into account, the salary grid can be structured in a balanced way and adjusted as required. This ensures a consistent and fair approach for each position, adapted to the realities of the market and the company's objectives.
2- Determining the right salary levels
- Analyse the market: Carry out comparative studies based on the pay scales of similar companies in your sector or region. Position your company in relation to the competition and adjust salaries accordingly. 👀
- Evaluate positions internally: Analyse positions in depth to identify the skills required, the responsibilities and the impact of each role on the company's objectives. This assessment ensures that remuneration is fair and aligned with the added value of each employee.
- Align with the company's objectives: Adapt salaries to the company's strategic priorities. For example, if innovation is crucial, pay more attractively for research and development positions.
- Regularly revise the pay scale: Update the pay scale in line with market trends, inflation and changes in the business. This regular review ensures that the company remains competitive and that employees receive fair pay rises.
- Consult staff representatives: Involve staff representatives or committees in the drafting process. Their perception of employees' expectations and needs contributes to a fairer pay scale and strengthens team support.
Example of a company pay scale
To illustrate how a pay scale can be structured, here is a simplified example that might typically be encountered in a company in the telecommunications sector:
| Position | Step | Coefficient | Minimum salary (€) | Maximum salary (€) |
| Junior technician | 1 | 200 | 1500 | 2000 |
| Senior technician | 2 | 250 | 2100 | 2800 |
| Junior engineer | 3 | 300 | 2500 | 3200 |
| Senior engineer | 4 | 350 | 3300 | 4200 |
| Project manager | 5 | 400 | 4000 | 5500 |
In this grid, each position is associated with a step and a coefficient, which determine the applicable salary range. The hierarchical system is based on a logic of steps: as the step increases, so does experience and responsibility, resulting in higher coefficients and higher salaries.
Company-specific pay scales can be much more complex, incorporating additional factors such as :
- performance bonuses
- increases linked to seniority
- or compensation for particular constraints.
The aim, however, remains to maintain a fair and motivating system. 👊
[Video] Tutorial: creating a pay grid in Excel
How do I read a salary scale?
A salary scale is often presented in the form of a structured table, which classifies positions by level or step. Each level indicates a minimum and maximum gross monthly amount, determined according to criteria such as seniority, qualifications or the responsibilities associated with the position.
In general, the rows of the grid represent the steps or positions, while each column corresponds to a progression criterion, such as seniority or skills.
🔎 To read a pay scale effectively:
- Identify your job level: locate your job title or step, which determines the applicable indexed salary range. This level indicates the basic amount to which you are entitled.
- Take into account the index coefficients and points: some pay scales apply index coefficients or points to adjust pay according to the impact and responsibilities of the job. A higher coefficient or number of points translates into a higher salary.
- Check possible career paths: the pay scale may indicate stages of salary progression, taking into account seniority, skills or length of service. This information allows you to see the opportunities for salary increases, as well as any allowances linked to your progression.
Salary grid and HR strategy: towards fairness in the interests of performance
The design and use of a salary grid plays an essential role in modern human resources management. It establishes a transparent and equitable framework, guaranteeing fair pay and promoting a harmonious and motivating working environment. Our aim? To build a pay scale that reflects skills, experience and responsibilities, while remaining competitive in the face of economic challenges.
Beyond its practical usefulness, the salary scale invites strategic reflection. It highlights the importance of pay equity in optimising performance and employee satisfaction. By mastering this remuneration model, companies can integrate the pay grid into an overall HR strategy aimed at developing talent and strengthening commitment.
Ready to explore the mechanisms of remuneration and adapt your HR strategy to current realities?
Article translated from French