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Tom Farmer outlines the process of developing a simple salary structure using a file containing employee information such as name, job title, grade, function, salary, evaluation score, and market value. He emphasizes that the information provided is fictitious and for illustration purposes only. Farmer also explains that individuals are assigned to a job, and there may be multiple employees with the same job title. The market data used for salary evaluation is derived from matching survey jobs to company jobs, rather than individual employees. This ensures consistency across all employees in a given job.
