What is Salary Revision? | Meaning & Definition | Akrivia HCM

Salary revision refers to the process of reviewing and modifying the compensation and benefits package of employees within an organization. It typically involves adjusting employees’ salaries based on various factors such as performance, market trends, cost of living, internal equity, and organizational budget.

During a salary revision, organizations may consider individual performance evaluations, market research on industry compensation trends, the company’s financial performance, and budgetary constraints. Based on these factors, an employee’s base salary, bonuses, incentives, allowances, or other forms of compensation may be adjusted.

Salary revision can be done in the following circumstances:

  • When the company’s salary structure does not match that of the market. 
  • When a salary revision is agreed to be done upon successful completion of the probation period.
  • Salary revision upon an employee’s promotion to a new position. 

What is the difference between salary revision and salary increment?

Salary revision is a comprehensive review of all components of an employee’s salary, including base pay, allowances, and bonuses. It is typically done regularly, such as every year or every two years. This aims to ensure that an employee’s salary is competitive with the market rate for their position and experience.

Salary increment is a one-time increase in an employee’s salary. It is typically awarded based on performance or seniority. The amount of a salary increment can vary depending on the company’s policies and the employee’s performance.

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