In the search for a new solution, Choicelunch tested several compensation management vendors—without the hoped-for results. “We tried other software, including Kenexa, but the data was just wrong. It was skewed way high,” said Gagnon. “We knew there had to be a better way.” Choicelunch started using PayScale, a cloud-based compensation software that delivers real-time data on 54 million salary profiles and 15,000 job titles. “Our first test with PayScale illuminated right away how our existing compensation rates led to high retention in one market and high turnover in another,” said Gagnon.
With PayScale, Gagnon and his team can ensure they’re paying competitively for many different roles, not just food service positions—crucial to companies that may work in one industry but must hire across several. PayScale’s 15,000 unique job profiles make it simple for Choicelunch to review and compare all position salaries. “When you have 220 employees, all working in different roles, in different cities, it’s really difficult to identify who is underpaid and who may be above market. PayScale makes that easy,” said Gagnon.
Before PayScale, Choicelunch saw varied retention rates across cities, even though employees were making the same amount. “We were basing all our rates off our home market, assuming everyone should be paid the same. Yet turnover was really low in Huntington Beach and really high in San Jose,” said Gagnon. Because PayScale identifies compensation medians within small geographic areas, Choicelunch can also compare and determine salaries within a single metropolitan zone, with multiple labor markets like Oakland and San Jose. “PayScale is helping us more easily identify and monitor flight risks,” said Gagnon.
Choicelunch now makes informed, real-time decisions regarding compensation. They also have access to hard, real-time data to show employees why they’re being paid as they are. “What [PayScale] really has helped do is kick start the conversation around how to design a good compensation philosophy,” said Gagnon. “More than anything, I don’t ever want people to feel they’re undervalued. I want people to understand the value they bring and how much we value them. And nothing translates more than dollars in that regard.”