What is Lockstep Compensation ?
‘Lockstep Compensation’ refers to the practice of compensating the employees based on their seniority or rank in the organization. No other factors such as their skill level, performance or qualification matters in setting the remuneration in this model.
The lockstep compensation model has been quite favoured in the law firms. However, it is failing nowadays due to the increased competition and difficulties in attracting good talent. Even law firms are adapting hybrid models that merge lockstep models with a merit-based one or a purely merit-based system.
The major disadvantage of a lockstep compensation model is that there is no extra incentive for the employee to work harder as there is no compensation for the same.