Pay Policy

About this Policy

This Pay Policy is designed to reinforce the Society’s values of inclusivity and to provide a framework for rewarding colleagues consistently and fairly, taking account of affordability constraints and the need to compete in the market for talent. The Policy should be viewed within the overall context of the Society’s Total Reward offering.

This policy applies to all colleagues (whether employed on a full-time, part-time, fixed term or permanent basis), it does not apply to agency staff and contractors.

This policy does not form part of any contract of employment and the Society may amend it at any time.

Pay Structure 

• The Society will operate one pay structure for all business areas and functions.

• There will be ten levels within the structure up to the executive level. 

• Roles are assigned to a level based on an assessment of job demands using the Korn Ferry Hay method of job evaluation.

• The structure is aligned to Korn Ferry Hay job units (a measure of job size) as tabulated below.

Table 1:  Midcounties Co-operative Grading Structure aligned to Hay job units

Pay Ranges 

• Pay ranges which will be assigned to each level aligned to the UK market for roles of equivalent size. The exception is Level 10, where due to the small number of roles, spot salaries will be used.

• These pay ranges will be broad to reflect the wide range of roles within each level.

• The Society will use appropriate external market comparators for the sectors in which it operates.

• Our broad pay bands for each level will be set based on the market median of the peer group.

• Within these overall pay ranges, more specific benchmarking will be undertaken for individual roles to determine appropriate market anchors within the overall broad pay range. 

• The broad pay ranges are not designed so that all colleagues progress to the mid-point or maximum of the range.

• In exceptional circumstances and subject to authorisation from the Chief HR Officer, pay for a particular role may exceed the maximum of the level assigned to the role in order to recruit or retain particular skill sets in light of external market pressures.

• The pay ranges will be designed with some overlap with the one above and below. This means that a colleague could potentially earn more than a colleague in a higher level. This is deliberate and is intended to support our need for flexibility and ensures in cases of promotion that this does not require an excessive increase to ensure that pay is at least at the minimum of the new grade.

• The increase between each level is not linear but reflects UK market practice.

• Level 1 will be reserved for apprentice roles and trainees. 

• Pay grade minima will be set taking account of the National Minimum Wage based on a 37.5-hour week.

• All colleagues should be paid at least the minimum of the pay range for their job level unless subject to a clearly defined development plan.

• Pay ranges will be reviewed each year (but not necessarily increased) prior to the annual pay review in April.

Location Allowances 

• It may be necessary to use location allowances in some instances in order to allow the Society to compete where there are particular market “hot spots” which make it difficult for the Society to recruit and retain. 

• Any such allowances will be subject to regular review and adjustment to reflect prevailing market conditions.

Pay Progression  

• For the majority of colleagues, their pay review will continue to be the subject of negotiation with our recognised trade union USDAW which is a major factor in setting pay within the Society.

• Pay awards for those colleagues who are assigned a pay grade at levels 1-4 will be based primarily on an across the board reward linked to the increase in the cost of living and value of labour

• For pay grades 5 and above, whilst pay awards to colleagues operating at this level will be based primarily on an across the board reward, two principal factors will also be considered:  

                - a market reference: this is usually the median pay for roles of a similar level in the all organisations peer group                                                                           although for some roles where there is clear evidence that a market premium is merited, the market reference may be higher;

                 - performance/contribution: higher performers may receive an enhanced award. 

• The highest pay awards will be made to those who are both high performers and who are earning significantly below the market reference that applies to their role.

• If a colleague is paid above the pay band maximum, which will be reviewed at every April pay review, we are likely to red circle their salary, but this will be subject to review each year.