Competency-based pay systems represent a fundamental change in the attitude of management regarding how work should be organized and how employees should be paid for their work efforts.

Competency-Based Pay

A compensation strategy where employees are paid based on their skills, knowledge, and performance levels rather than their job title or position.

Management Attitude

The disposition, outlook, or approach that the management of a company or organization holds towards its operations, employees, and business strategies.

Work Efforts

The amount of physical or mental energy applied by an individual in completing tasks or responsibilities at their job.