8/2/2023 0 Comments Merit increasePay equity has become a societal, economic, legal and political issue with companies facing greater scrutiny on what they’re doing for pay fairness. and, if so, how do they get from tier to tier? If not, what are the options for growth? If the answers employees get are rational, honest, and offer a path upward that they feel they can achieve, the employee is more likely to feel valued and stay with your organization.įor the final question, it is worth noting that the issue of pay fairness has become a critical part of all conversations on pay. For example, how does an entry level marketer become a mid-level marketer? Are there tiers for certain roles, like software developer 1, software developer 2, etc. Talking about pay progression is important because most employees will have personal and professional goals that they are trying to meet. Then how did you determine where they fall in the range, so what were the compensable factors that contributed to that decision? Was it performance, experience, time in role for example? The employee also wants to know how you decided that this range is appropriate. Is there some kind of pay range? Whether you reveal this range to the employee depends on your level of pay transparency. The answer to the first question is really about your pay strategy. Next, for individual context, there are three key questions employees have about their pay: Do you have a pay for performance strategy built into your merit review? Is cost of living a factor in merit increases? Is location specific pay relevant? Has company or business unit performance determined available budgets? Do you have a specific market pay strategy driven by skill and labor requirements? All are relevant points to help improve overall understanding and frame how your merit outcomes are reflective of your business strategy. Articulating what factors you aim to recognize will underline your philosophy. So, starting with strategic context, be prepared to explain how this year’s merit outcomes relate to your overall compensation philosophy and approach. To do this, your key messages should provide both strategic and individual context. The overarching objective is that we want to communicate pay well so that employees understand their pay outcomes and are inclined to stay with the organization, feel valued, engaged, and motivated to perform better. Step 1: Determine your key messages and communication objectives
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