This study aims to analyze the compensation system at BMP INDO SME and provide an evaluation by designing a fair compensation system using the overlapping method. BMP INDO is a Small and Medium Enterprise (SME) engaged in the installation of industrial equipment since 2018. The main issue identified in this study is the inconsistency in the compensation system across different job positions, which is influenced by subjectivity and results in internal inequity. The findings indicate that the implementation of the compensation system at BMP INDO has not been optimal, thus requiring improvements in the salary structure. This study is expected to provide insights into a more effective and sustainable compensation structure. Research data were obtained through interviews to analyze a compensation system based on pay for person, position, and performance. The results obtained after the compensation adjustment using the overlapping method show a new total salary of IDR 37,810,324, which represents an increase of 3.52% compared to the initial salary structure.