What is internal equity and external competitiveness of compensation

rashidmusa Started The Discussion:

Hi Seniors,

I need your help to work out on my assignment to examine the following.

Can seniors explain how the following factors determine salary and wages :

1. Internal equity

2. External Competitiveness.

What exactly are these terms in compensations and how these terms can be determine in order to address the issue of problem area.

kind regards


rashidmusa -  Member Since: Oct 2008
Should I Regreat To Post This Question ? 12 Views But No One Reply....................... I Am Still Hopeful.............. Warm Regards Rashid

rashidmusa -  Member Since: Oct 2008
Hi ,

It seems nobody is practicing Market Salary Survey in India. But if I ask for consultant many will appear on board projecting themselves as they are experts in conducting salary survey but could not answer this term I asked for whoch belongs to Market Salary Survey.

Can anybody explain?



sivapaparao -  Member Since: Jun 2007
Hi Rashid,

As per my understanding,

Internal Parity - Similar pay for similar work

External competitivenes- How competitive or fair are the salaries being paid to our employees for similar work in either our competitor or other organizations.


rajsawster -  Member Since: Jan 2008
Hi Rashid,

Don't worry I have answer for you.

1. Internal equityis a fairness criterion that implies an employer’s pay practices correspond to each job’s relative value in the organization.

2. External equityis a measure of an employer’s compensation levels compared to those employers within its recruiting market. As a fairness criterion, external equity implies that the employer compensates at levels that correspond to prevailing, external market rates, as determined by the job’s market range. External equity must be balanced with internal equity.

I hope this will solve your qery.




  • Do not post anything derogatory about any company or person.
  • Sharing articles from other websites should be done by posting a link to the original article.
  • To discuss sensitive issues create a pseudo/anonymous account.
  • Please avoid repeat posting your company profile - such accounts are removed automatically.
  • Found This Useful? +Vote Up This Via Google.  

    Why Vote? User validation is extremely important for good content to prosper.
    Disclaimer: This network and the advice provided in good faith by our members only facilitates as a direction towards the actions necessary. The advice should be validated by proper consultation with a certified professional. The network or the members providing advice cannot be held liable for any consequences, under any circumstances.

    Cite.Co helps people come together to solve each other's problems on all aspects of professional life.
    Share This Discussion:

    3M Users, 100K+ Documents & 450K+ Discussions
    About Us - Advertise - Contact Us - RSS   On Google+  
    All trademarks and copyrights held by respective owners. Member comments are owned by the poster.
    Privacy Policy | Disclaimer | Terms Of Service
    Facebook Page | Follow Us On Twitter | Linkedin Network