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Design a Base Pay Structure

Balance internal equity and market competitiveness to build an effective base pay structure.


  • Traditional base pay structures are seen as bureaucratic red tape that hinders a manager’s hiring ability.
  • Designing base pay structures can be complex, requiring accurate data collection and a significant time investment from HR and managers.
  • Pay transparency is difficult given the sensitive and highly confidential nature of pay information.

Executive Summary

Critical Insight

A credible compensation structure provides the foundation for increased pay transparency, and a hybrid approach to building the structure enables the right balance between flexibility and standardization to ensure equity and fairness.

Impact & Result

  • Design a pay structure that is internally and externally equitable by balancing the internal job worth hierarchy with external market competitiveness.
  • Leverage McLean & Company’s approach to building a hybrid pay structure that benefits from the advantages of the traditional and broadband approaches.
  • Empower managers by involving them in matching benchmarked jobs with market data and educating them on salary administration guidelines.

Research & Tools

1. Collect and analyze market data

Collect, analyze, and examine market data using the organization’s compensation philosophy as a filter.

2. Create the base pay structure

Create and finalize the base pay structure.

3. Determine salary administration guidelines

Identify and develop salary administration guidelines tailored to the organization.

4. Prepare to roll out the transparency strategy

Develop a pay transparency strategy suited to the organization and draft a communication plan.

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