Systems of pay have, appropriately, been the result of the demands of organisational structure. The complex hierarchical organisations of yesteryear were supported by the equally complex “factor analysis” system of pay administration. As organisational structures evolved into flatter, simpler designs, so pay systems became less complex. But now organisations are changing in a very fundamental way. They may appear to have little structure at all. They may just grow to meet the current needs; their structure has become organic. Likewise, pay systems will have to adapt. The author discusses traditional methods of pay for the job, pay for skills and incentives as well as team pay in light of the demands of the organic organisation. Ultimately it appears that pay, as a separate system within HR may disappear altogether. Organisations will move toward attracting, rewarding and retaining their employees through the design of a highly individualised “HR Environment”.
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