The problem of right pay for a given job has existed form many years. It is still alive and actual because the pay is the most essential element in the motivation system. The right pay for a work should take into account the most relevant requirements and hazards connected with the work, that means required knowledge and skills, responsibility, effort and work environment. The foundation of pay differentiation system is job evaluation and employees appraisal integrated together. The job evaluation is the process of analyzing and assessing the content of jobs, in order to place them in an acceptable rank order. It provides a disciplined framework for managerial pay decision and expresses the concept of "equal pay for work of equal worth". It is important that during the job evaluation only the job is evaluated; not the person doing it. Therefore the employees appraisal system is also needed because, in turn, it enables to differentiate the pay according to personal values, as for example performance, service time for a company, professional qualifications. In unit and small batch production the product range and production program are changeable. This situation causes the required quantity and quality of staff is changeable, too. That is why in these conditions the flexible workers who are able to do different jobs, to cope with different tasks due to current company's program are demanded. For that reason the aim of modern enterprises is to have high-qualified and flexible workers. It is advantageous for the company because the more skilled staff the easier to introduce changes in products, machines, manufacturing techniques and in consequence the better satisfaction of a clients needs. It is also advantageous for a manual, because the multi-skilled worker is more useful for the company and more competitive on the labour market. Than, the company should motivate workers toward up-to-dating their knowledge and enlarging their skills, The way of solution the problem is to develop the pay differentiation system so that the individual basic rate is dependent on the worker's multi-occupational level. To this effect the process of pay differentiation involves the following stages: - job evaluation for developing the hierarchical relation-ships of one jobs to another in order to differentiate basic pay in relation to job content (this is called here as the vertical pay differentiation), - employee appraisal for assessing multi-occupational level of a worker in order to assign him/her the appropriate personal category and next, the sailable basic rate (this is the horizontal pay differentiation), - determination of the rules for compensating by the basic rate considering both job category and personal category. Properly developed rules in the pay differentiation system are very helpful in the personnel management area because having them the company is able to plan and control of the labour costs. It may define and forecast the effects of different pay strategies. The useful tool for that is model ling and simulation, which makes possible to follow how the labour cost would change due to changes in quantity and quality of staff.