The United States Army's System for Determining Pay Raises

My employer is the United States Army, and I am a Captain in the Adjutant General's Corps which is the Army's human resources branch. As a human resource professional, I am very familiar with how the Army's pay and promotion system works. In the Army, there are two major factors which affect pay raises and a third which can also have a small effect on base pay. These three factors are time in service, rank, and annual pay adjustments. Overall, I think the Army has a very effective compensation system which pay its members appropriately. Only active duty pay will be discussed as the US Army Reserve and National Guard pay structure is similar but paid out differently.

Before covering the three factors which determine pay raises in the Army, it is important to discuss what comprises the Army's compensation package. The Army's compensation package consists of pay and allowances, benefits, and perquisites. The pay and allowances portion includes base pay, basic allowance for housing (BAH), and basic allowance for subsistence (BAS). Benefits include nearly all-inclusive medical coverage to Soldiers and similar coverage for family members, tuition assistance and other education incentives, and 30 days of paid time off a year. Some perquisites that come with being a Soldier are shopping privileges for the on-post venues of the commissary, which offers discounted prices on groceries, and the post exchange (PX) which offers clothes, home goods, sports equipment, and electronics also at discounted prices. Another perquisite is that many off-post retail stores and venues offer a military discount for current soldiers and retirees. These pay and allowance, benefits, and perquisites encompass the Army's compensation package. The pay and allowances are all affected by one of the three factors of time in service, rank, and the annual pay adjustment.

Time in service refers to how many years a soldier has been on active duty in the Army. Every soldier has a basic active...