compensation methodology

Compensation methodology refers to the structured approach an organization uses to determine how employees are paid. It involves analyzing factors like job responsibilities, skills, experience, and industry standards to establish fair and competitive salaries or wages. This process ensures consistency and transparency in compensation decisions, helping attract and retain talent while maintaining internal equity. Different organizations may use various methods, such as pay scales, performance-based bonuses, or market benchmarking, to align compensation with organizational goals and employee contributions.