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Base Pay Definitions

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Compensation 101

  • Format: Self-paced
  • Course Duration: 1 hr 8 mins
  • SHRM Professional Development Credits: 1.0
  • HRCI General Recertification Credits: 1.25
  • Certificate of Completion (after passing quiz)

Compensation plays a significant role in an organization's success. A compensation strategy must be designed well to attract and retain talent. As the single largest expense for most companies, it's imperative to develop the right pay structure and appropriate recognition methods. This course is for HR Generalists who need to learn basic compensation principles and their application to the business. During this course, you'll learn about developing a compensation strategy, methods for conducting a job analysis, developing job descriptions, and setting up base and variable pay structures. Compensation is one of those topics you must understand to not only drive the success of your business but also build essential skills for a successful career in HR.


SHRM:
HR Jetpack is recognized by SHRM to offer Professional Development Credits (PDCs) for SHRM-CP or SHRM-SCP. This program is valid for 1.0 PDCs for the SHRM-CP or SHRM-SCP. For more information about certification or recertification, please visit shrmcertification.org.

HRCI:
This activity, has been approved for 1.25 HR (General) recertification credit hours toward aPHR™, PHR®, PHRca®, SPHR®, GPHR®, PHRi™ and SPHRi™ recertification through HR Certification Institute® (HRCI®). For more information about certification or recertification, please visit the HR Certification Institute website at www.hrci.org.
The use of the HRCI seal confirms that this activity has met HR Certification Institute's® (HRCI®) criteria for recertification credit pre-approval.

Title: Base Pay Definitions
Module: Base Pay
Duration: 2:12

In this module, we will focus on the basics involving base pay, including key definitions, approaches to designing base pay structures, and pay increases.

Base pay means a fixed rate that is paid to an individual in exchange for the services he or she performs as an employee. There are three ways in which base pay is paid:

  1. Salary, which is fixed compensation paid on a weekly, biweekly, semi-monthly, monthly, or annual basis to an employee for services performed. In general, employees in jobs classified as exempt are paid on a salaried basis.
  2. Hourly Rate. A fixed rate paid for every hour of work performed by an employee. In general, employees in jobs classified as nonexempt are paid on an hourly basis plus overtime for all hours worked over 40 in a workweek.
  3. Piece Rate. This is a fixed rate paid per piece produced or action performed by an employee regardless of time. Organizations may pay a piece rate instead of an hourly rate or in addition to an hourly rate. If paid instead of an hourly rate, the organization must make sure that employees are paid at least the minimum wage rate for every hour worked. In addition, employees who are paid on a piece rate basis must also be paid overtime for all hours worked over 40 in a workweek.

In addition to an individual’s regular base pay, an employee may receive additional pay, sometimes called premium pay. Additional pay is also fixed pay because it is paid at a fixed rate and guaranteed when performing certain work or performing work under certain conditions. Examples of additional pay include overtime, shift differentials, hazard pay, geographical differentials, and on-call pay.

Instructor: Pamela Sande

Pamela Sande, CCP, is the Managing Principal of Pamela Sande & Associates, LLC. Pamela has over 25 years of human resources experience in both consulting and corporate roles, including as an HR executive and as a specialist in designing total rewards programs that drive organizational performance.

In her current role as Managing Principal, Pamela and...

Pamela's Full Bio

SHRM Recertification

HR Jetpack® is an official SHRM Education Partner recognized by SHRM to offer Professional Development Credits (PDCs) for SHRM-CP or SHRM-SCP.

HRCI Recertification

HR Jetpack® is recognized by HRCI as an approved provider to offer credit hours towards aPHR™, PHR®, PHRca®, SPHR®, GPHR®, PHRi™ and SPHRi™ recertification.

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