It is possible to increase workplace satisfaction and retention through effective salary revisions. Performance-based compensation and recognition are important to employees. Building a winning company culture begins with valuing and rewarding employees.
Salary revision the revision of the entire salary structure including all the primary components. It differs from a salary hike in which an increment is made to just a single component of the entire salary structure.
The components of the salary structure mainly include basic pay, PF, and gratuity. Most companies also add house rent allowance, special allowance, medical and travel allowance. Accordingly, if there is a 10% salary revision, it would mean an increase of 10% in all the components. However, a 10% salary increment would mean an increase in 10% of anyone component which mostly is the basic pay.
Salary revision may be done in the following circumstances:
- If the salary structure of the company does not match that of the market.
- If it is agreed that salary revision would be done upon successful completion of probation period.
- Salary revision upon an employee’s promotion to a new position.
Frequently Asked Questions
What is the difference between salary revision and salary increment?
A salary revision refers to a revision of a salary structure, taking IT considerations into account, and it gives an employee a competitive advantage in the job market. Whereas, salary increment refers to a regular increase in salary during a given period.
How to justify your raise?
This is how you can justify a raise:
- Describe your accomplishments in the past six months, past year, and during your employment with the company.
- Determine what your salary should be based on your position.
- Make sure your boss knows what they will gain from it.
What is a good raise?
The average pay rise is usually around 3%. A raise that’s higher than that is considered to be exceptional. A raise of 10% to 20% would be pretty good, depending on the reasons for it. If you perform well, have worked with the organization for a long time, or other factors apply, then you might be able to ask for more.