Can managers pay above the salary range? 02-06-2008

Is it legal for managers to pay certain staff whatever they choose to even though we have salary ranges and performance targets? We have some staff who are paid well beyond their "worth" and others that are paid well below market value?

Rita Risser replies:

Legally, you can pay people whatever you want, as long as you don't discriminate on the basis of sex, race, age, etc. If the managers are inconsistent in their own pay practices, and there are differences of gender or national origin among employees, then it may at least appear to be illegal unless the discrepancies are justified by legitimate business reasons. If, on the other hand, each manager is consistent but you have inconsistencies across the organization, that is safer legally. However, sometimes the problem is that random behavior by managers might look like a discriminatory pattern if seen across the organization. That's why most companies have salary grades and try to have consistency among employees.

Good luck.

The only thing worse than an untrained manager is an untrained manager who treats employees inconsistently for no good reason. Call us to help you. 1-800-458-2778.

Information here is correct at the time it is posted. Case decisions cited here may be reversed. Please do not rely on this information without consulting an attorney first.