Rock the PHR Exam 2025 – Unleash Your HR Superpowers!

When managing red-circle employees, a common strategy involves freezing the pay rate until the salary structure is adjusted to address the situation. Red-circle salaries refer to compensation that exceeds the maximum pay range for a particular job, typically the result of employee longevity, market conditions, or salary inequities. By freezing the rate, the organization avoids further compounding the problem of overpaying employees relative to their position in the salary structure while allowing time for a review and revision of the salary ranges.

This approach is often seen as fairer to both the organization and the employee, as it prevents immediate cuts to pay which can lead to dissatisfaction and potential legal issues. It also offers a chance for strategic planning to align salary ranges with changes in market conditions or internal evaluations of job roles. This strategy emphasizes the need for integrity in salary management while providing a responsible means to address over-compensation without unnecessarily disrupting employee morale.