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Mykkah Herner, M.A., CCP, PayScale
Last year was a year of ups, downs, and shutdowns. The Affordable Care Act is still looming over us, the impact unclear. Some but not all companies are pulling free of the recession. Employees have continued moving around more and more since the official end of the recession. Yet amidst the turmoil, there are some key lessons. Essentially, in an uncertain time, compensation plans and strategies need to be flexible. In this article I’ll talk about the top 5 ways we can infuse flexibility into our programs.
- Know how you’re doing relative to the market at all times
Some organization leaders are hesitant to do a market assessment when they’re unable to give out increases. I would argue that it is almost more important to arm yourself with the knowledge of your market position when you don’t have readily available funds. As the saying goes, knowledge is power – and having the knowledge of where you stand gives you the power to address issues before they become a problem.
Many of the organizations I work with are already paying fairly to the market. When we start their projects, they admit that they haven’t looked at the market in a long time, thinking that if they don’t look, they won’t find something they don’t want to see. The fact is, assuming folks were in good standing in 2009, they’re probably not too too far behind now. Some things have shifted, sure, but it’s better to know by how much so you can be prepared to answer questions and communicate your position appropriately to your employees. Once your employees have a sense that they’re underpaid, even paying at the 90th percentile for the next 10 years won’t make them change their minds. And, if you haven’t been able to afford increases in a while, your employees will feel underpaid whether they are or not.
Practically speaking, if you have positions that are paid low relative to the market, target these for increases as soon as you do have funds available. Consider non-monetary rewards as a means for retention of employees in your hot jobs.
- Be creative w
4/27/2014 3:00 AM - 4/28/2015 2:59 AM
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