A partner who wants to buy into your dairy asks about the crew: if your herdsman left tomorrow, what would you pay the next one? A bank financing a new milking parlor asks the same, and also what a milker must do to move up. On the example farm below, the answer is on one sheet: the herdsman’s job pays $4,000 to $4,800 a month, or $48,000 to $57,600 a year. Without the sheet, the figure is whatever the next candidate asks for. So write one sheet for the farm, with the jobs in order, what each takes, its lowest and highest pay and the rule for a raise. Post it for the crew, and keep what each person earns private.
What is a pay band, and what does it say about a job?
A pay band is the range of pay for one job: the floor is the least you would pay anyone in the job, and the ceiling is the most. Gregorio Billikopf, a farm labor specialist at the University of California, writes that individual differences can be acknowledged if each job has a rate range. The higher steps go to longer seniority, to merit or to both.
The example farm is a 180-cow dairy in Vermont with six employees. Its sheet has three jobs, named as the crew already names them. The herdsman runs the daily care and feeding of the cows. The herd manager job is held by the owner’s daughter, and it goes on the sheet like the others.
Next to each job, write what a person must be able to do to get it, as something you can see them do. Add the minimum months in the job below before they can ask, so a worker can tell an honest “not yet” from a “never”. If you have written job descriptions, take the requirement from the tasks listed there.
How far above the job below should a job’s floor sit?
Far enough that a bigger job pays visibly more than time alone. Australia has a pay ladder written into law. Farm pay there is set by an award, the legal pay schedule for an industry, and the Pastoral Award 2020 puts farm and livestock hands on eight levels, each with its own minimum weekly rate. A station hand with less than 6 months’ experience is level 1, one with 6 to 12 months is level 2, and one with at least 12 months is level 3. Level 8 is a senior dairy operator who, under the owner or manager, supervises and maintains the operation of a dairy farm.
| Level | Who it includes, for example | Minimum weekly rate (A$) | Above level 1 |
|---|---|---|---|
| 1 | Station hand with less than 6 months’ experience | 978.10 | Entry level |
| 2 | Station hand with 6 to 12 months’ experience | 1,004.90 | 2.7% |
| 3 | Station hand with at least 12 months’ experience | 1,006.80 | 2.9% |
| 8 | Senior dairy operator who supervises the operation of a dairy farm | 1,202.50 | 22.9% |
Time in the job buys small steps, and a bigger job buys a big one: under 3% for the first year of experience, 23% for the job that supervises others. The example farm follows the same shape. The herdsman’s floor is 21% above the milker’s, and the herd manager’s floor is 25% above the herdsman’s. Copy the shape, not the figures.
Bands can also overlap. Billikopf notes that a person at a top step within a pay grade may earn more than a person in a higher pay grade, but at a lower step. How much overlap to build in has practical consequences. On the example farm each ceiling sits below the next floor, so there is none.
If you farm in Australia, these rates are legal minimums. Anywhere else, the floor of each job comes from the minimum wage and any award or agreement where you farm, which your accountant or a labor lawyer can confirm.
How do you write a raise rule that answers yes or no?
Without a rule, raises follow whoever asks. Bitsch and Hogberg interviewed 15 workers at 14 Michigan greenhouses, nurseries and landscaping firms. Entry pay was seen as low, yet the most frequent complaint was the lack of regular raises or of an established system to decide them. These were interviews, not a survey, and none of the businesses was a dairy.
Write the rule as one criterion for each step of the band, answered yes or no. Billikopf says reviews for raises could be triggered by specific performance accomplishments, or skill acquisition. Farm Commons, a nonprofit that writes legal guidance for farmers, lists reasons to give a raise, among them more responsibility, a new skill or certification, and staying a set number of seasons. In its advice on bonuses it warns that vague terms such as “work hard” leave room for interpretation and conflict, and the same holds for a raise.
To build the steps, split the band from floor to ceiling into equal parts. The milker’s band, $3,300 to $3,900, splits into three steps of $200. A person who meets a step’s criterion gets that step’s raise.
Test each criterion by asking two people to judge the same worker, the herdsman and you. If their answers could differ, rewrite it. “Runs a full milking shift alone” passes, and “works hard” does not.
Make the top step the hardest to reach. Billikopf warns that employees who advance too quickly may have no further economic incentive and feel stagnation, so the upper levels of the scale must be harder to achieve. Past the ceiling, the next move is the bigger job.
Which pay goes on the wall, and which stays private?
The band and the raise criterion go on the wall, and the amount each person earns stays between you and that person. The evidence comes from a bank, not a farm. Cullen and Perez-Truglia ran a field experiment with 2,060 employees of a large bank in Southeast Asia. Employees who found out that their managers earn more than they thought worked harder, and the effect was stronger for managers a few promotions away. Employees who found out that their peers earn more did not work as hard.
Direct evidence on the effect of a posted pay ladder is still missing. In a 2023 review of pay transparency, Cullen writes that for internal pay grids direct evidence on the causal impact is lacking. So take only the general lesson from the bank study: seeing the pay of the job above tends to help, and seeing what a co-worker earns tends to hurt.
Do not count on the amount staying secret. In a crew of eight, someone will probably know. On a small farm almost every job has one person in it, so anyone who reads the band can tell roughly what that person earns. Post the band anyway, and accept that for a one-person job the band comes close to the wage. What the crew gains is the raise criterion in plain sight, and that protects you from a charge of favoritism.
What do you check before you post the sheet?
Check that every floor is legal, that every step has a criterion with a yes or a no, and that nobody on the crew sits below the floor of their own job. On a private copy, mark anyone below the floor and fix that pay first. Then go through the six steps in one afternoon, with the pay you already hand out in front of you.
Posting the sheet promises no promotion. You write down what each job takes and the earliest a person can ask, never who moves up or on what date, so you stay free to hire the best person for an opening. Update it on the same day you hold a review run on rules each person knew in advance. A ladder does not make a low wage fair, so first pay a wage that holds up against the farm down the road. Why farmers who pay well still lose good people is taken up in why good pay does not keep people, and a bonus for a good year has its own terms, written first.
Deciding by a rule the crew knows is part of running a farm. More on hiring, reviewing and paying the people who work for you is in the people section of the library.