Compensation Strategy / Pay Philosophy (positioning / percentile) Compensation Structure (jobs, grades, bands, location adjustments, etc.) Total Cash Compensation Compensation Strategy / Pay Philosophy Remote Gitlab Reward Strategy Should Be Driven By - Strategic business vision (5+ years) Financial & operational goals (annual / quarterly metrics for the Board) Revenue model & profit margins trends External market factors (clients, clients of clients, technology, talent, competitors, substitutes…) Compensation Structure Salary range Base Pay Variable Pay For Base Pay Increase - Merit Matrix Bonus Criteria ● Company performance (revenue or income) vs individual performance based Individual vs team vs cross-team results? That would define performance management system, and integrated performance metrics you want to track ● Flat vs adjusted by role / performance / tenure / skills → Favor A-players minority or lower paid roles/grades? Tech skills? Behaviors-based? ● Annual / quarterly distribution ● Effected or not by annual salary raise, commissions (if sell / bring business) Compensation Structure Examples Based on Company’s Quarterly Performance - Flat Based on Company’s Annual Performance. Adjusted Bonus is designed around company’s annual performance overall, and gets adjusted up or down based on individual evaluations. For example: The company's has reached its goals for the year: everybody in principle gets a month salary as a bonus; but the economic outlook is really bad so that is cut in half. Evaluations of all workers are on qualities important to their jobs, scaled from A (way worse than what is expected) to E (way better than what is expected). Worker A receives evaluations averaging a C -> gets him the standard bonus. Worker X receives evaluations averaging a D -> gets her the standard bonus plus 10%. Worker Z receives evaluations averaging a B -> gets him the standard bonus minus 10%. Mixed Model Appendix Public Handbook - Total Reward (examples) Gitlab Remote Desana Sources https://www.varinsights.com/doc/employee-bonus-programs-advice-from-software-ceos-0001 https://drive.google.com/file/d/1ZtPnp444bnBvejvgG51Gna_2yeizqoI4/view?usp=sharing https://peoplecentre.wordpress.com/2016/02/26/pay-slope/ https://about.gitlab.com/handbook/total-rewards/compensation/#bonus-payout-approvals http://blogs.ubc.ca/comm203bemmels/files/2017/05/M5-V3-External-Equity-and-Pay-Policy-Sauder-Doc.pdf https://remotecom.notion.site/people-Total-Rewards1945bce8d3924ece9421ba8630f57b0c#60c84cbd9c5245578fb1cb0eadd47d1d https://www.thehumancapitalhub.com/articles/What-You-Need-To-Know-About-Compa-Ratios https://www.uth.edu/hr/department/compensation/FY20%20Suggested%20Classified%20Merit%20Matrix.pdf https://www.youtube.com/watch?v=JelJycLEkKo