Pay differentiation

from Wikipedia, the free encyclopedia

Pay differentiation (traditionally also: wage differentiation or salary differentiation ) is a collective term for the internal structure and breakdown of collectively agreed remuneration. As part of labor or collective bargaining law , pay differentiation refers to the income of employees from employment ( wages ).

The aim of wage differentiation is to find a wage for work done that is perceived as fair by all those involved. The focus is on the demand for fair pay, in particular non-discrimination. In doing so, an employer's total wages should remain as low as possible.

The social discourse on the question of the extent to which differences in the level of wages due to qualifications or burdens or inconveniences are economically sensible, fair or desirable is carried out in society under the keywords of wage spread , wage equality or social inequality .

In Germany, it is up to the parties to the collective bargaining agreement to determine the amount of the wages (see: collective bargaining autonomy ). Where there are no collective bargaining regulations, the regulation is made in the employment contract. Pay is the generic term for the legally no longer meaningful terms wages and salaries .

A basic distinction is made between the basic pay and performance pay components . Often there is also a third component: the allowance (see also: performance allowance , allowance ). The principles according to which the remuneration is determined is traditionally referred to as the remuneration principle. The way in which a principle of remuneration is implemented and the data relating to it are developed is the method of remuneration .

Basic pay

The basic salary should not come from a specific situation or short-term behavior of people, but should result from the organization . At the same time, there are two approaches in circulation, the qualification-oriented remuneration and the demand-based remuneration .

Qualification-based pay

Job descriptions often contain not only descriptions of the tasks to be performed on the spot, but also information about the qualifications the job holder must have. Such information simplifies the search and selection of personnel.

The idea is to differentiate the level of remuneration according to the qualification requirements: the engineer earns more than a master, but less than a doctor.

This type of pay differentiation is occasionally propagated by trade unions and sometimes woven into individual collective agreements. The union interest is to avoid wrong appointments. In difficult times there is a tendency for job seekers to also apply for underqualified positions. Up to a certain point, this can be interesting for employers, as they then harbor a potential that can lead to benefits free of charge. As a result, however, the properly qualified are displaced downwards, and unemployment shifts to low-skilled population groups.

Qualification-oriented pay differentiation has so far hardly caught on in Germany.

Appropriate remuneration

Pay differentiation based on requirements is the method of pay differentiation that can be found in almost all collective agreements . It is so widespread that it is the only one mentioned in most textbooks on the subject of pay differentiation.

In this case, the amount of the basic remuneration is determined according to the requirements (see: Requirements determination ) that the job places on the person holding it.

Performance fee

The performance fee applies to the person who takes up a position. So it is a personal component of remuneration. A distinction is made between two situations:

  • A bonus that a person receives because they generally do more than can normally be expected. Such a bonus is often already granted as part of the employment contract , for example to attract a specific person, but can be terminated separately if the person does not meet expectations. Such a premium is therefore paid in advance.
  • A specific individual performance is rewarded. Whether by piece rate , bonus , bonus or performance bonuses . With the exception of the contract wage (or program wage), this type of performance fee is paid in arrears, i.e. only after the service has been performed. The excess harbors the risk that the employee interprets this type of performance pay as a (motivation-reducing) distrust.

Allowance

A bonus is an increase in remuneration based on the personal circumstances of an employee. With the exception of the performance bonus, it is usually not based on the employee's personal behavior during a period, but on his or her situation. Allowances can have any justification. Typical allowances are:

See also

Sources / literature

  • REFA Association for Work Studies and Business Organization e. V. (Hrsg.): Methodology of business organization: Pay differentiation. 3rd edition, Hanser, Munich 1991, ISBN 3-446-16227-5 .

Individual evidence

  1. ^ Glossary on collective bargaining policy - L. Hans Böckler Foundation, accessed on October 19, 2008 . . See entry “Wage Differentiation”.
  2. ↑ For the dirt allowance and infection allowance, see, for example, in Austria: “Schmutzzulage” - flat rate allowance according to Section 20 (1) Salary Act 1956; “Infection allowance” - flat-rate expense allowance and hazard allowance in accordance with Section 20 (1) or Section 19b Salary Act 1956; Expansion of the circle of recipients. (Circular) Federal Ministry for Education, Art and Culture, 1998, accessed on October 19, 2008 (website last changed on March 26, 2007).