Is There a Maximum Rate of Pay?


Read this Scenario

Is There a Maximum Rate of Pay?
Ted Smith, the Total Rewards Manager for Front Appliance Company, was a pretty relaxed and friendly guy—an easy-going manager. Although he was a no-nonsense, competent executive, Ted was one of the most popular managers in the company. This particular morning, however, Ted was not his usual self. As chair of Front’s job evaluation committee, he had called a late-morning meeting at which several jobs were to be considered for re-evaluation. The jobs had already been rated and assigned to Pay Grade 4. But the office manager, Ortho Janson, was upset that one of his employees was not rated higher. To press the issue, Ortho had taken his case to two executives who were members of the job evaluation committee. The two executives (Production Manager Peter Strong and Marketing Manager Margo Arms) then requested that the job ratings be reviewed. Peter and Margo supported Ortho’s side of the dispute, and Ted was not looking forward to the confrontation that was almost certain to occur.

The controversial job was that of receptionist. Only one receptionist position existed at Front Appliances and Rebecca Reichart held it. Rebecca had been with the firm 14 years, longer than any of the committee members. She was extremely efficient, and virtually all the executives in the company, including the president, had noticed and commented on her outstanding work. Peter and Margo were particularly pleased with Rebecca because of the cordial manner in which she greeted and accommodated Front’s customers and vendors, who frequently visited the plant. They felt that Rebecca projected a positive image of the company.

When the meeting began, Ted said, “Good morning. I know that you are busy, so let’s get the show on the road. We have several jobs to evaluate this morning and I suggest we begin…” Before he could finish his sentence, Peter interrupted, “I suggest we start with Rebecca.” Margo nodded in agreement. When Ted regained his composure, he quietly but firmly asserted, “Peter, we are not here today to evaluate Rebecca. Her supervisor does that at performance appraisal time. We are meeting to evaluate jobs based on job content. In order to do this fairly with regard to other jobs in the company, we must leave personalities out of our evaluation.” Ted then proceeded to pass out copies of the receptionist job description to Peter and Margo, who were visibly irritated.

Respond to the following in a well-integrated Assignment (use as Subheadings):

1. In your educated opinion, was Ted justified in insisting that the job, not the person, be evaluated? Discuss.

2. If you were Ted, what would you do and say next? Why?

3. As an HR professional, do you think there is a maximum rate of pay for every job in an organization, regardless of how well the job is being performed? Justify your response.

4. Assume that Rebecca is earning the maximum of the range for her pay grade. In what ways might she be able to obtain a salary increase?

Bring in at least 7 library sources to help strengthen and support your response.

For instruction on writing papers, citing sources, proper referencing, and so forth, See the following if additional guidance on APA style is needed:

The Purdue OWL website:

APA Formatting: The Basics. Retrieved from

Required Reading

Armstrong, M. (2012). Chapters 1, 7, 13, 15, 16, & 18. In Armstrong’s handbook of reward management practice: Improving performance through reward. London: Kogan Page. Retrieved from EBSCO in the Trident Online Library.

Determining base compensation: Should you use market value or internal equity? (2002). Employee Benefit Plan Review, 57(5), 4. Retrieved from the Trident Online Library.

Society for Human Resource Management (2016).

Optional Reading

Business & Legal Reports (2014). Employee Compensation in California. Madison, CT: BLR.

Graebner, D. R., & Seaweard, K. A. (2004, August). Bringing it all inside: Job evaluation and market pricing at JCPenney. Workspan, 47(8), 30-35. Retrieved from the Trident Online Library.

Minow, A. S. (2012). Reasonable compensation. California CPA, 80(7), 11-13. Retrieved from the Trident Online Library.

Survey says most firms have formal salary range structures. (2011, January). IOMA’s Report on Salary Surveys, 11(1), 7-8. Retrieved from the Trident Online Library.

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