Q3	The Upper Quartile marks the boundary between the top 25% and the remaining 75% of organisations’ practice lines.
M	The Median which divides the upper 50% and lower 50% of organisations’ practice lines.
AVE	The Average (also called Arithmetic Mean) is the sum of the values at the selected job Category (company size) divided by the number of data points.
Q1	The Lower Quartile is the division between the top 75% and the remaining 25% of organisations’ practice lines.

Base Salary

The guaranteed annualised amount paid for employment without the cost of any benefits.

Guaranteed Package (Also called Cost to Company or GP or Guaranteed Cost of Employment)

Includes Base Salary and those significant benefits that are quantifiable in terms of cost to the organisation, i.e. pensions, life and health insurance, provision of cars, or car allowances, club or association membership fees, mortgages or loans provided at less than commercial rates of interest.

Total Cash

This comprises Base Salary plus all variable bonuses, profit share awards, and incentive payments related to some measure of (company and/or individual) performance. This is not a common comparison figure in South Africa, but is popular, particularly in the USA.

Total Annual Based Reward

Defined as the cost to the organisation of Guaranteed Package, plus all incentive and variable bonuses.

STI (Short- term incentive schemes)

Usually schemes designed to pay out annually, with a link to individual or company performance, or both. Typical schemes include, inter alia:

• Performance Bonus
• Team Based Bonus
• Profit share
• Gainshare

LTI (Long-term incentive schemes)

These are generally designed for periods of longer than a year and theoretically focus the recipient on the long term goals of the company, inter alia:

• Share schemes
• Share Option Schemes
• Phantom Shares
• Roll Over Banking
• Deferred compensation

LINE FORMULA (Also known as Practice Line, Pay Line, Hay Line or Calibr8 Line)

The Line of Central Tendency drawn through a scattergram (see below) of remuneration plotted against evaluation points (Formal job evaluation result). This line can be described in a formula which allows the user to select a job size (In this case, Survey Category, Calibr8 Score, or Hay Score) and by applying the formula, derive what the Remuneration should be against the line of central tendency. This is often used to derive a policy pay level, as it removes, or at least reduces, the variances that can be found on the various job category based reports, due to specific individual situations.

SCATTERGRAM

A scattergram is a graphic representation of the relationship between two variables such as salary and evaluation points. Each job is plotted using total job points on the x-axis (horizontal) and Rands - either midpoints or actual compensation - on the y-axis (vertical). Scattergrams underlie the line formula analysis, but are not shown.

CALCULATION OF LINE FORMULA

For your convenience, the method for calculating a line formula (i.e., X x Job Size + RY) between two intercepts is as follows:

b) Y = S¹ - (J¹ x X)

Where S2 is the highest salary point, S1 the lowest, and J2 is the highest Job Level, J1 the lowest. To calculate a straight line formula between, for example, R8 000 at 200 Job units and R21 000 at 1000 Job units.

a) X =	(S2) R21 000 - (S1) R8 000
	(J2) 1000 - (J1) 200

X =	R13 000
	800

X = R16.25

Y = (S¹) R8 000 - [(J¹)200 .U.x (X) 16, 25]

Y = R8 000 - R3 250

Y = R4 750

Therefore, the straight line formula between 200 and 1000 Job units is:

R16.25 x Job Units + R4 750