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  • The Impact of Compensation Methods and Decisions

    The Impact of Compensation Methods on Employees and Organizations The Impact of Compensation Methods on Employees and Organizations

    It’s time to think about the many, sometimes subtle, choices behind determining appropriate compensation of your employees. The success of your organization can ride on these compensation decisions.

    From the mom and pop shop that needs workers to restock shelves to large corporations whose employees manage million dollar funds, your organization’s compensation decisions can either boost your bottom line or leave it in the gutter. The key is to make realistic, budget-friendly compensation decisions at each step.

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  • Compensation Budgeting: Determining Merit Pay Increases

    Determining Merit Pay Increases Perform Efficient Compensation Planning for Merit Pay Increases


    We are in the post-season for HR. It’s open enrollment time, flu season and, for a lot of organizations it’s also the time of the year for performance management and merit pay increases. Basically, there’s so much to do and so little time to do it. Welcome to human resources. Did anyone tell you it was going to be like this? Probably not.

    They also probably forgot to tell you that you would do this event-based activity on top of all of your normal day-to-day hr tasks including employee relations issues and recruiting. But, you are a superstar who can manage an employee relations issue in between phone calls with your benefits broker while drafting a revised sick leave policy to account for the swine flu epidemic. 

    Now, if you could just get some help from your managers. But, here’s the toughest part – your managers need help from you.

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  • Employee Compensation Policy

    Writing an Employee Comp Policy Writing an Employee Compensation Policy


    For legal protection and good business sense, every company should have an up-to-date employee compensation policy. What is the status on yours?

    An organization should not wait for dire circumstances, such as a pay inequity lawsuit, to write down or update their employee compensation policy. All organization leaders should create a written policy document or refresh their existing one for legal protection, and as a guideline or framework for the company’s compensation program.

    Below is a list of helpful tips and tools for creating an effective employee compensation policy that is specific to your organization.
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  • The HR Role in 401(k) Participation

    401k Participation How to Increase Participation in a 401(k) Plan Among a Young Workforce

    Here’s a known issue, at least in my experience: Most 27-year-olds can’t be bothered to save in their 401(k), unless you bribe them with a 401(k) match. “No match, don’t bother me.”

    Rather than give up on 401(k) participation among 27-year-olds, let’s think through what would make it “inevitable” that they save. The first step to increasing participation in a 401(k) plan involves analyzing this as a sales problem.

    Sales Obstacle #1: We insist on selling 401(k)’s to 27-year-olds as a retirement vehicle.

    If they retire at 70, they’ll retire in the year …. 2052. For most 27-year-olds I’ve worked with, “2052” is just not relevant – yet. 2052 as the focus? No sale.

    Solution: Sell the 401(k) plan as a savings vehicle to 27-year-olds in a way that is compelling to them.

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  • What Is a Workforce Planning System?

    What is a Workforce Planning System? Workforce Planning: You Don't Have to Be a Planner

    I am a planner by nature and the choice I made of what business to go into - human resources and policy analysis - reflects this preference. The title of this blog is meant to appeal to the many business owners and managers who hear “workforce planning” and, unlike me, would rather not plan but just jump right in and “get ‘er done.” I’d like you to realize that you’re already doing workforce planning everyday and give you some tips on how to do it better.

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  • Developing a Compensation Philosophy

    Developing a Compensation Philosophy Why You Need a Compensation Philosophy

    By Staff Writer

    In a recent PayScale webinar, Stacey Carroll, MBA, SPHR, touched on a key HR process that can get skipped when life at the office becomes too hectic. Once you’re done sorting out a new hire’s training schedule or making sure current employees understand their medical benefits, it’s important to set aside time to review or create your company’s compensation philosophy. This philosophy will then inform your compensation policy. And, that policy acts as the foundation of smart compensation program.

    How do you get started in this HR process and what is the difference between a compensation philosophy and a compensation policy?

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  • Creating a Compensation Policy and Philosophy

    Webinar Q&A Session – The Essentials of Developing a Total Compensation Policy

    The following is a transcript of the question and answer session that followed PayScale’s webinar, Developing Your Compensation Philosophy & Policy. The topics covered in these questions include vacation time, salary comparisons and sharing salary range information with employees. The main focus is developing a compensation plan philosophy and creating a compensation policy that’s competitive. Answers are provided by PayScale director of customer service and education, Stacey Carroll, MBA, SPHR.

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  • Establishing Competitive Pay Rates

    Competitive Pay Rates How to Target Pay Rates for a Job Position

    Here at PayScale, the HR professionals that we work with often ask us, “What method should we use for targeting pay rates for a position?” While the compensation planning tool that we offer our customers gives them plenty of numbers and calculations, it does not provide a pay strategy for a particular job position. That's up to you to develop based on company goals.

    So, how do you narrow down all of your salary data strategically?

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  • Hiring a Compensation Consultant

    Compensation Consultant When Should You Hire a Compensation Consultant?

    Keeping great employees around can make or break a company’s success. Would you like some personalized help with your compensation planning to attract and retain top talent?

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  • Determining Supervisor Pay Grades

    Determining Supervisor Pay Grades What Is Fair? Supervisor vs. Employee Pay Grades


    In my time both in the military and civilian workforces, I’ve always been curious to know more about what weighs on my supervisors from day to day. Such things as scope of supervisor responsibilities, everyday demands, and supervisory skills required for them do their job. Sometimes I’ve wanted to know this information so that I can better support my supervisors. Other times, I’ve been in the mind frame that, “Heck, I could do their job.” And it comes down to, “Well, how much money do they make?”
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  • Non-Monetary Compensation

    Non-Monetary Compensation Non-Monetary Compensation and the Essentials of Developing a Total Compensation Policy

    They say cash is king, but in today’s economy employees know that there is more to the story than cash alone. Today’s job seekers and your employees have become more savvy about non-monetary compensation. And there is a good reason they are paying attention to it.

    Good health insurance and a generous retirement plan benefits are becoming more and more elusive. Employers who offer these non-cash rewards stand out among their peers.
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  • Employee Rewards

    Employee Rewards The Benefits of a Rewards and Compensation Strategy


    There are not many second chances in running an organization. A misstep can cost thousands of dollars to correct. For instance, not setting up your compensation strategy correctly can mean you’re not able to attract the talent you need. By contrast, your overall rewards and compensation strategy is one area where you get a second chance.
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  • Creating an Effective Compensation Plan for Sales Representatives

    Compensation Plan for Sales Representatives Creating an Effective Compensation Plan for Sales Representatives

    An effective sales compensation plan for sales representatives is critical to the success of any go-to-market strategy. Yet the design and management of a compensation plan for sales teams is rarely easy. After all, determining how people are paid is a sensitive matter which can become increasingly complicated when reconciling the disparate needs of key stakeholders in sales, finance, HR, and marketing.

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  • Compensation Strategies for a Bad Economy

    Compensation Strategies for a Bad Economy Pay for Performance: Compensation Strategies for Recessionary Times

    By Staff Writer

    Many companies will have modified their compensation and benefit plans during this economic recession in an effort to save money. They need to minimize costs now and, hopefully, get set to recover from the recession faster than their competitors.

    You may have already reduced merit increases or even enacted a pay freeze. What are the trade-offs of cutting or freezing pay? Would an across the board pay-cut make sense or would it hurt certain key performers too much?

    Let’s take a look at how the economic crisis has impacted compensation, and how you can maintain a pay-for-performance culture in recessionary times.

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  • HR Cost Cutting with a Red Circle Policy

    Redcircle Red Circle Policy: A Penny-Wise Choice for Your Company

    After you create your employee compensation policy, you may discover employees within your organization who, rather than being underpaid compared to the market, are actually overpaid. Salary faux pas like this can cost your company plenty of money.  Among the many company cost-cutting ideas out there, implementing a red circle policy is likely your best option in this case.

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  • Laying the Foundation for Your Compensation Strategy

    Webinar Q&A Session - A Guide to Laying the Foundation for Your Compensation Strategy

    Questions and Answers from Our Compensation Strategy Webinar

    The following is a transcript of the question and answer session that followed PayScale’s webinar, A Guide to Laying the Foundation for Your Compensation Strategy. The topics covered in these questions include strategic compensation planning, red circling, and determining salary ranges. Answers are provided by PayScale’s webinar leader and director of customer service and education, Stacey Carroll, M.B.A., SPHR.

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  • What Are the Components for a Compensation Plan?

    Compfoundation How Do I Develop a Compensation Plan to Protect My Company?

    Has your company reached the point where it needs a formal compensation plan but you aren’t sure how to create one? You may realize the value of an established compensation policy for employee retention. And, even more, you likely aware that you need to explain and back up your compensation decisions today more than ever, particularly any differences between pay for people in the same position.

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  • Does Your Company Have Internal Pay Equity?

    Internal pay equity The Importance of Internal Pay Equity: How to Ensure Fair Pay

    Now more than ever, employers need to be able to explain their pay decisions. Besides living in culture where online salary information is free and abundant, the Lilly Ledbetter Fair Pay Act signed into law by President Obama has increased the liability to employers to ensure that you have equitable pay practices. It is easier now for your employees to win an expensive and embarrassing lawsuit.

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  • Cost Cutting Examples of Compensation Plans

    Costcutting 6 Simple HR Strategies for Reducing Company Costs During a Recession

    With layoffs and benefit cuts happening all around us, it’s a crucial time to strengthen the relationship between HR and business strategies. Like many companies, your business is likely tightening its belt, trying to find ways to cut costs and survive on lower profits. As an HR professional, now is a great time for you to take a leadership role and share ways HR can save your company’s money.

    Need some ideas? During two webinars in February 2009 - Employee Retention: High Impact Performance Management for Engaging and Retaining Your Top Performers and HR Planning: HR's Role in Strategic Workforce Planning for 2009 and Beyond - PayScale sat down with business leaders from a variety of industries and locations and asked them for a sample of HR strategies they were using to lead their organizations’ human capital and cost management efforts.

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  • How to Write a Compensation Plan

    Compensationplans How to Write a Compensation Plan: Some Fundamentals During a Recession

    Maybe as employers, we can get a little complacent about our compensation plans this year.

    We’re all sitting in the catbird seat today. And maybe still will be next year.

    Along the way, especially if the economy doesn’t improve, the only folks we’re really likely to lose are – who? Well, there’s a concern! It’s our outstanding employees who are the highest turnover risk – those who are keeping us successful during a recession.

    So let’s discuss how to write a compensation plan, today, that will keep us in business for the long run. One that will encourage employee retention, maintain morale, limit employee turnover and keep us HR types on the CEO’s “nice” list. Here’s how:

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