Communicating Compensation: Talking with Employees
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Communicating Compensation: Talking with Employees
Jennifer Ferris, CCP Compensation Professional
Mykkah Herner, MA, CCP
Manager of Professional Services
www.payscale.com
www.payscale.com
14,000 Positions 3000 Customers 11 Countries
250 Compensable Factors 40 Million Salary Profiles
COMMUNICATING
COMPENSATION
Part I: Gaining Executive Support
Part II: Equipping Your Managers
Part III: Talking with Employees
www.payscale.com
Agenda
Recap of Part I: Gaining Executive Support
Recap of Part II: Equipping your Managers
Develop a communication plan
• Prepare your executives to deliver messaging
• Ready managers for different scenarios
Tips for Employees
Immediate Action
Recap of Part I: Gaining Executive Support • Overview of Communication Basics
• Overview of Compensation Basics
Communicating Compensation to Executives
• Understanding the Executive Audience
• Align compensation to business goals
• Incorporate leading edge practices
• Keep executives up-to-date with quick snapshots
http://resources.payscale.com/hr-webinar-recorded-communicating-compensation-gaining-executive-support.html
Recap of Part II: Equipping your Managers
Set expectations with managers
Equip managers for their role • Negotiation skills • Listening skills • Compensation review meeting • Talking points
Present compensation basics to managers
http://resources.payscale.com/hr-webinar-recorded-communicating-compensation-equipping-your-managers.html
Develop a Communication Plan
TACTIC RESPONSIBILITY AUDIENCE KEY MESSAGES TIMELINE
OBJECTIVE 1: FINALIZE COMP PLAN - GRADE ASSIGNMENTS, COMMUNICATION PLAN, POLICY REVISION
OBJECTIVE 2: OBTAIN EXECUTIVE APPROVAL
OBJECTIVE 3: TRAIN MANAGERS ON COMP PLAN AND HAVING EFFECTIVE CONVERSATIONS
OBJECTIVE 4: EXECUTIVES ANNOUNCE PLAN TO FULL ORG
OBJECTIVE 5: SUPPORT MANAGERS TO ROLL OUT COMP PLAN TO THE EMPLOYEE LEVEL
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Executive Messaging
Prepare talking points for executives, covering:
• Compensation philosophy & purpose
• Compensation plan changes at the highest level
•Next steps – talk with managers
• Approve program
• Communicate program to org at a high level
• Perform manager/supervisor role Executive Roles
Manager Toolkit
• Understand the program
• Communicate with employees
• Get support from HR
Manager & Supervisor Roles
Prepare tool kit for managers, including:
• Compensation plan talking points
• Compensation plan information
• Details for each employee they supervise
• Tips for each type of conversation they may have
Lead The Conversation 80% of employees will compare pay
Finding out where you stack up vs. peers can dramatically change: • Desire to stay/leave
• Overall job satisfaction
• Exert more/less effort
I was approached by an employee who was very upset that her base pay was being frozen. After going through our philosophy, the employees pay compared to the grade and range she was in the employee left the meeting with a smile on her face, feeling positive about the conversation.
Monarch Landing, 300 employees
Source: Card, D., et al., (2011); “Inequality at Work: The Effect of Peer Salaries on Job Satisfaction.”
“Wow! This is what our employees need to see! They only ever talk about what they see in their paycheck, so this would really drive home our total investment!”
Alberta Motor Association - 2,000 employees
Accounting Assistant
Senior Accountant
Accountant I
Accountant II
Grade C Grade E Grade 5 Grade 7
Basic Function & Key Differentiators
• Administrative Accounting Functions to support AP & AR
• Update General Ledger • AP / Vendor Relations • AR
• Maintain General Ledger
• Prepare financial reports
• Interpret financial reports and statements for management
• Analyze financial data • Prepare budgets
Degree & Certification Requirements
None Bachelor’s Degree No certification required
Bachelor’s Degree CPA required at proficiency
Bachelor’s Degree CPA required at start
Critical Skills at proficiency
• Attention to Detail • Excel • Data Entry • Quickbooks
• Attention to Detail • Quickbooks
• GAAP • General Ledger • Monthly Reconciliation • Financial Reporting
• GAAP • Financial Reporting • Financial Analysis • Budgeting
Years of Experience
• 1-2 at proficiency • 3-5 at proficiency • 5-7 at proficiency
• 8-10 at proficiency
Anticipate Employee Questions & Concerns
Employee Pay is Low
Consider Should the employee pay be low?
Is the organization able to adjust employee pay?
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Talking Points Start by appreciating accomplishments
Mention market movement of the position if applicable
Explain position in range
Remind of last year’s adjustment amount if appropriate
Discuss what you will or won’t do for increase or bonus depending on skillset, performance, etc.
Open the door
Employee Pay is High Consider Is the employee truly red-
circled?
What does the employee need to move to the next level?
Does the organization need that work performed? And if so, are they willing to pay?
15
Talking Points
Start by appreciating accomplishments
Mention market movement of the position, or lack thereof
Explain position in range & organizational policy
Remind of last year’s adjustment amount if appropriate
Discuss what you will or won’t do for increase or bonus
Open the door
Employee Given No Performance-based Increase
Consider What does the employee need to be
eligible for the next round of increases?
What potential does the employee have to move up in the organization?
16
Talking Points Start by appreciating contributions
Remind of performance issues
Explain position in range
Discuss what you will or won’t do for increase or bonus depending on skillset, performance, etc.
Explain what they need to do to be eligible next go round
“I FOUND A
SALARY
REPORT
ON THE
INTERNET” o Conflicting
information
o The “independent study”
o Position pricing vs. people pricing
o The conversation
17
Additional Tips for Managers
Consider the Employee Perspective
The employee is often going to want:
More money
Promotion
To be paid like their peers
To understand why others are paid more than they are
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Defining the Generations
Identify Creative Solutions
When more money isn’t an option:
Know what the employee’s interests are; what will motivate them?
Additional/alternative perks
FTE preference
Staggered increase or offer
PTO
21
Immediate Actions • Connect with your employees about what motivates
them
• Identify conversations about compensation you need to have with your employees
• Develop clear career paths
• Prepare any high level messages about comp
• Prep toolkits for your managers to use when communicating with employees
PayScale Delivers Where Other Compensation Providers Fall Short PayScale leads the world in compensation knowledge with the freshest and most detailed data from over 40 million salary profiles. More than 3000 organizations use PayScale’s software and intelligence to get the greatest return on their talent. Smart businesses use PayScale Insight to recruit, retain and motivate their people.
Visit our blog: www.payscale.com/compensation-today
Join our Group on LinkedIn: Compensation Today: HR Best Practices
Jennifer Ferris, CCP Compensation Professional Mykkah Herner, MA, CCP Manager of Professional Services, PayScale, Inc.
www.payscale.com
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