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3. Broadbanding

In order to sustain a method of retaining features which involves positive scale of payment, ‘Broadbanding’ is one of the effective measurement into consideration which includes lesser effects as desired. Talking about these less desirable effects, it includes positive incentive schemes that motivated employee on focusing into getting promoted rather than just working on the same position for long. But such a scheme can also introduce individuals in the firm which plays office political games in order to undermine their senior employees and weakening the positioning of the employees at their level. One of the effects of refusals of resposiltities is the inflexibility when employees do not encourage the job responsibilities allotted to the higher graded employees. The position has been noticed when the managers becomes too rigid to increase the pay of new employees in order to satisfy the internal equity as a key point to determine the payment structure in the firm. And in turn, this leads to intense competition in the labor market.

Broadbanding is a scheme that involves reducing the salary bands while sustaining a specific system of grading in the firm. The process of broadbanding will involve the results which will replace the structure which includes dozens of grading with the structure which includes not more than three or four distinct grades. The variation in the pay is not directed to the nature of job but rather involves the basis of employee’s performance and dedication to their designation. If you are thinking what advantage can it really bring, well it’s the reduction of hierarchical mindset in a firm. When the employees are graded highly among others, it reduces the tension among the colleagues created by difference in the payment structure. When the criterion is objective and open to the colleagues, it decreases the feeling of inequity among the employees. This means that team work will be encouraged in the firm which will help in improving the overall performance of the firm as well as on individual basis. On a theoretical basis, the concept of broadbanding focus on the flexibility among the managers as it will reduce the discretion among them and ultimately organization will reward the employees on the basis of their performance and evaluation as per the job size allotted to managers and different employees. This method helps in justifying the payment structure of each individual. But at the end, it’s on the clock of time to judge the claims with equal values when such cases are approached towards courts.