Competency-based pay systems compensate employees for the different skills or knowledge they possess rather than for the job they hold in a designated job category.

Question

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Competency-based pay systems reward employees based on the skills, knowledge, and behaviors they demonstrate, rather than the specific job title or position they hold. This approach focuses on the competencies that are valuable to the organization.

Competency-Based Pay Systems Compensate Employees for the Different Skills or Knowledge