Objective:A salaried Differentiated Pay Structure (DPS) model based on the work of Dr. Virginia Cleland was tested on two units. The project objectives were to: 1) create a budget-neutral compensation distinction for different competencies and educational levels; 2) evaluate the effect of the new salaried model on unit costs and pay; 3) determine the effect of the DPS model on job satisfaction, organizational commitment, and anticipated turnover; and 4) assess the impact of professional commitment, professional practice climate, perception of staffing adequacy, and dispositional optimism on job satisfaction, organizational commitment, and anticipated turnover.Background:Although there has been long-standing interest in salaried models and reward methodologies, there is a dearth of systematic research associated with specific compensation models.Methods:A quasi-experimental, non-equivalent control group design was used to examine the effects of the DPS model.Results:Findings demonstrated that nurses were paid more under the DPS model, and that they were paid for more hours than they actually worked (N = 68). No difference in job satisfaction was found between experimental and control groups. For all nurses (N = 232) dispositional optimism was associated with all job satisfaction subscales except pay. Organizational commitment, professional commitment, professional practice climate, and staffing adequacy were also correlated with job satisfaction, perceptions of care quality and anticipated turnover. Older nurses who had worked longer in nursing, and who had more tenure were less satisfied with their coworkers and care quality.Conclusion:Further longitudinal research with larger experimental samples is required in order to fully understand the effects of the DPS model in nursing.