Define: Compensation Structure

A compensation structure refers to the framework or system used by an organisation to determine and administer employee pay and benefits.

Common types of compensation structures include salary-based structures, commission-based structures, performance-based structures, and hybrid structures that combine various elements.

Yes, as long as the differentiation is based on legitimate factors such as job responsibilities, skills, experience, performance, or market conditions, and not on discriminatory grounds.

Generally, employers are required to provide advance notice to employees before making significant changes to the compensation structure, unless such changes are explicitly allowed in the employment contract or collective bargaining agreement.

Yes, employers must comply with federal, state, and local minimum wage laws, which set the minimum hourly rate that employers must pay to their employees.

In most cases, employers cannot unilaterally reduce an employee’s compensation without their consent, unless there is a valid contractual provision or a legitimate business reason, such as financial hardship.

No, it is illegal for employers to discriminate in compensation based on protected characteristics such as gender, race, age, religion, disability, or national origin.

The provision of benefits is generally not mandated by law, except for certain benefits like Social Security, workers’ compensation, and unemployment insurance. However, employers may choose to offer benefits to attract and retain employees.

Yes, employees who believe they are being unfairly compensated may file a complaint with the appropriate government agency, such as the Equal Employment Opportunity Commission (EEOC) or the Department of Labor, or pursue legal action against their employer.