Determining the proper salary to pay your employees goes far beyond simply settling on a competitive number and offering that figure. There are several factors that should be considered, such as the value of the position to your company, the amount of experience an individual is bringing into your company, fairness of pay throughout your company, room for pay increases, and how much your company can actually afford. Furthermore, each and every business is unique. In order to grow, your company should have its own distinctive method that works best for your specific situation. Following are a few general guidelines to keep in mind when creating a customized salary strategy for your workplace.


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Know your limits
Before starting, you need to know not only how low you are willing to go, but how high you can afford to go. After setting your endpoints, you will have the necessary framework in place to properly determine all salaries throughout your company.

Be specific

Job descriptions need to be detailed, and should never overlap. Clearly define all duties associated with each and every position. The shipping clerk should not have the same responsibilities as the stock clerk.


Without an employee in place, decide what value the position has to your company. Is this a position that will have a high rate of employee turnover or is it a role that can be turned into a career. How essential is it that the person in this position remains with and continues to grow along with your company?

Research the competition

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You don’t have to pay the competitive rate, but you do need to be aware of what it is. Are you willing and able to offer a higher rate in order to snatch up the right prospect?

Fairness goes a long way

Employees want the opportunity to climb the career ladder, striving for positions such as Administrative Assistant or Office Manager. Set your pay scale so the individuals you employ have an incentive to advance, not a reason to be bitter.

Leave room to grow

This goes back to knowing how high you can afford to go. Do not give an offer that will kill the possibility of a raise. If you offer the maximum at the start, what reason does an employee have to stay over the years if there’s no appreciable benefit to loyalty?


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This article was written by Allen Foster for CBS Small Business Pulse.