The complex world of wage determination


Xeinadin Group



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You have the perfect candidate in mind; they’re qualified, pleasant, and you think they’d be an asset to your business so you decide to hire them. Now you are faced with the daunting question: what do I offer as pay? Wage determination is complex, and there isn’t a simple answer. Different qualifications are worth more than others depending on location, job position, and industry. Being an expert ski lift operator is wonderful, but not necessarily helpful when hiring a waiter in the centre of London. Here are some considerations to take when deciding what to pay a team member.

What are the specifics of the job?

Develop a job title and description that accurately reflect your expectations of the candidate. Specify any duties or responsibility you expect of the candidate. Develop a job title that is both unique to the position but relevant to the industry sector. 

What is the market rate for this type of team member?

Once you have developed the title and description of this work, look into what average salaries are. Find out what other businesses in the area are offering, as well as looking into national and regional averages by looking online. It is important to remember to comply with wage laws; minimum wage, payment requirements, holiday leave, and overtime obligations are all important to consider.

What does the candidate expect, and what is their salary history?

What is the candidate’s asking pay? For some candidates, this part of their application is critical to their accepting the position. Additionally, be sure to inquire as to their current pay (fixed, commission, wages) as well as whether they receive additional benefits (laptop, cellphone, flexible hours, etcetera). Also, be sure to ask what their goals are and what they expect from this position; are they looking to move up the chain of command, increase their salary, or garner a partnership? All of these add to the value of a candidate, as well as guiding you to your end-goal.

What can you afford?

Be sure that whatever you are willing to offer the candidate is an amount that you can afford. While it is always nice to pay people high amounts, it is not always smartest for the business. Look into how much revenue your new team member will help contribute, and whether you think that they will provide a return on your investment. Consider whether the potential team member will fit well into the company hierarchy and whether they will help productivity. Always think about the salary as well as the taxes and benefits that it will cost. What you can also throw into consideration is salary sacrifice,

“While it is always nice to pay people high amounts, it is not always smartest for the business.”

Making an offer

Once you’ve talked to your HR-advisor (or solicitor) and accountant to make sure everything checks out, you are ready to make an offer. Here are some strategies you can use to help your offer get accepted:

  • Straight salaries are easiest for you but are less appealing to the candidate.
  • Offering a mix of benefits, such as shares and performance bonuses may help your offer get accepted, plus they help the team member work harder thanks to goal-oriented benefits. 
  • Provide flexibility: you can offer a salary sacrifice scheme, occasional part-time work, flexibility with taking extra time to study, go on holiday, or take care of the family. Money is important, but for many candidates, it isn’t everything.

Once you have completed the payment offer process, and the candidate has accepted, make sure to fill out the necessary paperwork and keep good records of the hire. Start a file for the team member, including all the negotiations of the employment.

Offering competitive and accurate pay brings new talent to your business, which may be just what you need to grow and succeed!


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