Sharon McKnight, CCP SPHR
In a previous position as an HR director, I was tasked with developing a sustainable pay system for a large hourly workforce within a production-oriented environment—lots off manual labor at multiple positions, many requiring similar experience and skill sets.
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The production department was utilizing a pay for knowledge system where new employees were each assigned to run a specific piece of equipment, all at the same starting rate. As time passed, employees were trained on additional pieces of equipment and, once they became proficient, were given an increase, gaining a dollar per hour for each piece of equipment they mastered.
A simple plan but with complications; for example, not every employee received an opportunity to learn all the different pieces of equipment. Also, not every employee had the ability to master the nuances of each workstation as easily as others making the transition between workstations cumbersome.
For further insight on Step-Based Pay, read here.