Compensable Factors

A compensable factor is a value or trait that employers use to determine how much to pay an employee.

Compensable factors for sales employees could include the dollar value of new account registrations, contract extensions and upselling activities, as well as experience, education, and tenure.

Common compensable factors include:

• Experience
• Complexity
• Level of education
• Type of supervision
• Level of responsibility
• Impact of errors
• Fiscal accountability
• Confidentiality
• Mental and physical demands
• Number of employees supervised

The greater the employee’s experience, strengths, and responsibilities, the more value they (generally) create for the company.

Compensable factors help employers pay employees fairly based on their merits and responsibilities.

Click here to learn more about compensable factors