Abstract: Human resource is the key resource for high-technology companies, and compensation is the main incentive tool to gain human capital advantage. "The system is more important than technology", pay systems are most important for high-technology firms' survival and development. Based on these existing researches, a scientific and reasonable pay system according to the characteristics of high technology firms and their human capital is put forward. Pay systems in high technology firms must be arranged with a compensation level which is higher than or compares with the market pay level. The pay systema are competency-based, long-term incentives related employee benefit with firm profit, broad banding pay structural, total reward and competition mechanism. An empirical study about pay system effectiveness in high-technology firms is given, which offers data evidence. Finally some suggestions about pay system reform in high-technology firms are provided.

Key words: high-technology firm, pay system, human capital