Guarantee Cash－Mid-point Progression
Beijing
Hebei
Shandong
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Guarantee Cash－Range Spread
A salary range consists of a minimum pay value, a maximum pay value and a mid-point. The difference between the maximum and the minimum is the range spread or the the width of the range
– Timeframe for achieving Target Market Position: 3 years
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Considerations in Salary Structure design
In order to increase the accuracy of the new system design, and make it easier to do cost analysis, the proposed new salary structure adopts the actual salary data of all employees provided by HR department of China Mobile Beijing, Hebei and Shandong
Hebei
18~23%(Increase) 17~23%(Increase) 10~22%(Increase)
5~20%(Increase)
Shandong
10~23%(Increase) 10~23%(Increase) 10~21%(Increase) 1~20%(Increase)
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35~45%(Increase) 35~40%(Increase) 35~30%(Decrease) 35~20%(Decrease)
35~40%(Increas 35~35%(No Chan 35~30%(Decreas 35~20%(Decreas
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Guarantee Cash－Range Spread
Beijing
Hebei
Shandong
Grade 17~19(Senior Mgt.) Grade 12~16(Mid Mgt.) Grade 6~11(Supervisor) Grade 1～5(General Staff)
35~45%(Increase) 35~40%(Increase) 35~30%(Decrease) 35~20%(Decrease)
Grade 17~19(Senior Mgt.) Grade 12~16(Mid Mgt.) Grade 6~11(Supervisor) Grade 1～5(General Staff)
Beijing
12~24%(Increase) 12~23%(Increase)
5~23%(Increase) 5~21%(Increase)
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Guarantee Cash－Anchor Point
Grade 11 are selected to be the anchor points for salary
structure midpoint design, following is the detail information for
Currently China Mobile Beijing’s range spread is relatively big, thus we adjust the range spread gradually based on the market trend. In the end, the situation is that the higher the grade is, the wider the range spread is.
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Salary Structure Design - Guarantee Cash
The first step for salary structure design is to set the Guarantee Cash for each grade benchmarking with market situation. The detail process is as following:
The grading information adopted in the new salary structure is based on GGS, which is just for salary structure design use, not the final grading result for China Mobile
– All employees’ Guarantee Cash should be correspond to Market median (P50). And based on the market trend, widen the GC gap among different levels of employees gradually, thus change the current situation that GC varies slightly among different levels.
Range spreads vary based on the level of sophistication of skills required for a job. Jobs requiring skills which can be mastered quickly usually have a narrower pay range. Senior jobs which require a longer learning curve and often have limited opportunities for advancement tend to have a wider pay range
1st Adjustment 3rd Adjustment 2002 Market Medium
È if the progression is relatively low, possible result could be salary compression issues and difficulty in matching promotions with appropriate compensation reward
There are two considerations when setting mid-point progression
È if the progression is too high, possible result could be costly promotional increases
China Mobile Human Resources Enhancement
Project Meeting
Acenture Consultancy Co., Ltd July, 2001
Agenda
Project deliverable Discussion
Part I：Market Comparison Result Part II：Salary Structure Design Part III：Benefit Plan Suggestion Part IV：Stock Option Plan Suggestion
– Adjust the percentage of Variable Pay Vs Guarantee Cash, thus change the current situation that VP percentage is too high.
– Widen the Total Cash salary gap among different levels based on the Market trend.
According to Acenture survey, annual salary increase rate varies from 5% to 11%, so we assume the average salary increase rate of market will be at 8% in the next three years
Considering the whole structure, the progression is adjusted gradually by grade, till in the end the structure is adjusted to the situation that the higher the grade is, the bigger the pay gap is.
Confidential
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Draft foroDnliyscussion
Part II. Salary Structure
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Considerations in Salary Structure design
Based on the proposed salary structure discussed in last meeting on June 1st, and the interview with China Mobile top management, considering the current salary situation of China Mobile three pilot sites , suggested salary structure is designed based on the following pay philosophy：