In some compensation systems indivi

In some compensation systems individual pay levels are based on step increases. The step increases for one labor grade are illustrated in Exhibit 15. These step increases are based on performance and length of service. The exhibit shows a labor grade containing six step increases and three performance levels. The starting salary for this labor grade is $11.00, and the maximum salary is $16.98. To reach the maximum, an employee must have a high Performance level and must advance through all six steps of the labor grade, The step increases can be automatic -advancing one step each year-or variable. Variable periods of time for the step increases provide an additional means for supervisors to control pay increases. Supervisors not only evaluate performance but also decide when it is appropriate to advance each employee to a higher step within the labor grade.