Pay Structures | Why Pay Structure Review Must Be a Budget Priority

By Jamie Surman, Reward Director, Turning Point

As summer draws to a close, many organisations are beginning the process of setting budgets for the year ahead. With this comes a familiar challenge: how to balance competing priorities while investing in the workforce needed to deliver future success. For HR leaders, one question deserves particular attention: does the current pay structure remain fit for purpose?

Employee costs are often one of the largest, if not the largest, areas of expenditure for businesses. As a result, pay decisions can’t be separated from budget decisions. A sustainable budget needs to account not only for the cost of current salaries, but also for the investment required to maintain fair pay differentials, support meaningful progression, and ensure reward structures remain resilient in the face of labour market pressures, statutory pay increases and legislative requirements.