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classification based upon qualifications and experience, subject to approval by the City Council. A probationary employee may advance to the next pay step after satisfactorily completing six months of employment which meets performance expectations, based upon a recommendation from their supervisor subject to approval of the City Administrator. The employee will then follow the annual increases as defined in Section H. Compensation is largely based on wage/salary grades and steps within the salary grade. For any position subject to this policy, compensation must be assigned using an eleven-step grid within each salary grade, with an increase of 34% from the minimum to the maximum step. In determining or evaluating compensation levels, the City Administrator must maintain a schedule of comparative compensation amounts for all positions covered under the policy. A new employee must be hired at the pay grade minimum whenever possible. The City Administrator or appropriate department head may recommend the new employee be hired at a rate above the minimum of the pay grade for his/her classification based upon qualifications and experience, subject to approval by the City Council. A probationary employee may advance to the next pay step after satisfactorily completing six months of employment which meets performance expectations, based upon a recommendation from their supervisor subject to approval of the City Administrator. H. Annual Increases Subject to Council approval of the compensation plan, every year thereafter, on or about January 1st, regular employees who have completed their probationary period an employee may advance to the next pay step after satisfactorily completing another year of employment which meets the performance expectations until he or shethey reaches the grade maximum. New hires who are in their probationary period at the time of the annual increase will not move to the next pay step until their 6th month anniversary, however, they will move to the corresponding step in the new salary range, i.e., if they are at step 3 in the current plan they will move to step 3 in the next plan. If an employee does not have satisfactory performance, they will not advance to the next pay step and may be placed on a performance improvement plan. Determination of satisfactory performance must be recommended to the City Administrator by the immediate supervisor on forms prescribed by the City Administrator.Administrative Services Director. Employees who are at or above the grade maximum will receive the predetermined cost-of-living-adjustment (COLA) based on a satisfactory performance review.