BA 2650 Compensation Management Module 3 Homework Creating a Pay Base Structure Your assignment for week Module 3 is to assume you are a compensation analyst at International Bakery Company (IBC). You have been assigned to create a simple base pay structure. You will use the attached Base Pay Structure Chart (I) to present your design to executives. Note that the first pay grade of the chart has been completed for you. It may help to use the chart as a reference as you move through the parameters introduced below. Guidelines At IBC, the CEO and VP Human Resources have given you these parameters. The pay structure does not include top executive compensation. Neither the CEO nor any of the senior VPs are on the pay grade chart. Part-time/temporary employee positions are not placed on the chart either. The maximum full-time pay on the pay grade chart will be $170,000 (maximum base pay for VPs). Other pay elements (e.g., stock options, perks, etc.) are not included in the amount on the chart. The minimum starting full-time pay is $5.00 an hour. Yes, thats below minimum wage, but lets use that starting point to keep things simple. You would calculate the equivalent salary as follows: $5.00/hr x 2000 hours (50 weeks a year x 40 hours per week) = $10,000 per year. Yes again, there are 52 weeks in a year, but this keeps the math simple. The pay structure will consist of fifteen pay grades. Each grade represents a pay range of $20,000. Therefore, the pay range for Grade 1 will be $10,000-$30,000. There are five steps in each grade. Employees who stay in the same grade may progress up the steps until they reach the maximum end of the range. For simplicitys sake, each step up in pay within a grade is equal to $4000. Therefore, if an employee performs well and moves up a step within Grade 1, he or she will then make $14,000 base pay. If the same employee performs well again and moves up another step within Grade 1, he or she will then make $18,000 base pay. For simplicity sake, the midpoint of one grade will become the starting point (point of overlap) for the next grade. So, given that the pay range for Grade 1 is $10,000 - $30,000. The midpoint would be $20,000. The Grade 2 pay range would therefore begin with $20,000 and end $40,000. Grade 3 would begin with the midpoint of Grade 2 ($30,000) and end with $50,000. You can calculate the rest. Your Assignment 1Complete the Base Pay Structure Chart (I). 2Now, relate the organization chart of IBC to the pay grades on your chart. See the right-hand column on the Base Pay Structure Chart. Use this column to list jobs on the organization charts that you believe would fit in this pay grade. Obviously, you will be making assumptions and using your best judgment. You may not have a title for every one of the grades. INTERNATIONAL BAKERY COMPANY BASE PAY STRUCTURE CHART - I Pay Grade Minimum Midpoint Maximum Step 1 Step 2 Step 3 Step 4 Step 5 Job Titles in This Grade 1 $10,000 $20,000 $30,000 $14,000 $18,000 $22,000 $26,000 $30,000 Cashier 2 $20,000 3 4 5 6 7 8 9 10 11 12 13 14 15