Organisations have taken cost and complexity out of their structures by reducing the number of levels from top to bottom. The resultant flatter structures do not sit well with a large number of grades with small steps in between them.It is inevitable that pay structures
with a large number of levels lead to ‘grade hunting’, as people search for small changes in their responsibilities to justify a re-grading. Additionally, such complex grading arrangements have traditionally consumed a great deal of management time simply to administer and maintain.Against this familiar background the appeal of broad banding is clear. Rather than have multiple grades, it works within a dramatically simplified pay structure with pay ranges more closely matching the reduced organisational levels.Typically, a structure which might previously have included 20 or more grades can be described in, say, six to eight broadband levels. This approach offers clear benefits:Maintenance becomes significantly less arduous;
Employees are less inclined to grow empires instead of acquiring competencies or driving performance; and
Pay management is radically simplified.