HR AND PEOPLE MANAGERS
ENGAGING EMPLOYEES
THROUGH COMPENSATION

HR AND PEOPLE MANAGERS
ENGAGING EMPLOYEES
THROUGH COMPENSATION

Learn how you can make the most of your merit cycles with best practice insights, manager-employee communication tips, and employee engagement outcomes.

Learn how you can make the most of your merit cycles with best practice insights, manager-employee communication tips, and employee engagement outcomes.

DRIVE COMPANY ALIGNMENT

Don’t make the mistake of thinking that compensation is strictly HR’s responsibility. To engage employees and drive a stronger company culture, every part of the organization has an important role to play in setting and communicating compensation

HR has a critical role in working with executives to align strategy, coordinate processes, develop and deliver resources, and report progress and outcomes.

Executives set the pace for compensation planning by working with HR to establish a clear philosophy and strategy, as well as determining the appropriate level of transparency to support their unique company culture.

Managers work with HR to determine, allocate, and communicate pay decisions. The influence managers have on the employee experience cannot be overstated — people leave managers, not companies, which is a huge reason why the manager role in compensation is so critical.

Employees aren’t without a role in compensation and communication. Their role is asking clarifying questions, understanding the compensation plan, and the goals of the organization, so they can do their part with confidence that the organization has their back.

Want to learn more about how to make compensation a Team sport?

READ THE WHITEPAPER

DRIVE COMPANY ALIGNMENT

Don’t make the mistake of thinking that compensation is strictly HR’s responsibility. To engage employees and drive a stronger company culture, every part of the organization has an important role to play in setting and communicating compensation

HR has a critical role in working with executives to align strategy, coordinate processes, develop and deliver resources, and report progress and outcomes.

Executives set the pace for compensation planning by working with HR to establish a clear philosophy and strategy, as well as determining the appropriate level of transparency to support their unique company culture.

Managers work with HR to determine, allocate, and communicate pay decisions. The influence managers have on the employee experience cannot be overstated — people leave managers, not companies, which is a huge reason why the manager role in compensation is so critical.

Employees aren’t without a role in compensation and communication. Their role is asking clarifying questions, understanding the compensation plan, and the goals of the organization, so they can do their part with confidence that the organization has their back.

Want to learn more about how to make compensation a Team sport?

READ THE WHITEPAPER

MAKE YOUR NEXT MERIT CYCLE COUNT

COMMUNICATION

EFFICIENCY

SECURITY

COMMUNICATION

EFFICIENCY

SECURITY

COMMUNICATION

COMMUNICATION

Providing the right mix of compensation to attract and retain top talent is only part of compensation best practices. Equally important is how compensation practices are communicated, understood and perceived by an organization’s employees.

According to PayScale’s 2020 Compensation Best Practices Report, there is a significant chasm between employer and employee perceptions about pay. While 45% of employers believe employees at their organizations are paid fairly, only 21% of employees feel the same.

To improve employee perceptions, make sure your employees understand their total rewards. This is particularly important when it comes to variable pay, stock ownership, and benefits. For example, it is not altogether uncommon for employees to accept an offer including a year-end bonus but never learn from their manager how the bonus is achieved or paid out. If there are also intangible benefits for working with your organization, such as flexible work hours, catered meals, or the ability to bring a pet to work, make sure you explain that differentiation as well.

Providing the right mix of compensation to attract and retain top talent is only part of compensation best practices. Equally important is how compensation practices are communicated, understood and perceived by an organization’s employees.

According to PayScale’s 2020 Compensation Best Practices Report, there is a significant chasm between employer and employee perceptions about pay. While 45% of employers believe employees at their organizations are paid fairly, only 21% of employees feel the same.

To improve employee perceptions, make sure your employees understand their total rewards. This is particularly important when it comes to variable pay, stock ownership, and benefits. For example, it is not altogether uncommon for employees to accept an offer including a year-end bonus but never learn from their manager how the bonus is achieved or paid out. If there are also intangible benefits for working with your organization, such as flexible work hours, catered meals, or the ability to bring a pet to work, make sure you explain that differentiation as well.

EFFICIENCY

EFFICIENCY

Merit cycles are complex endeavors — even more so as your company grows. When HR teams have to manage the process via spreadsheet each point of communication, decision, and change represents manual time required to ensure accuracy. Before implementing Team, PayScale client Margarita Navarro noted “Each increase cycle took me 16 hours a week for four months. That’s 256 hours! I was building the spreadsheets from beginning to end, correcting, modifying, updating, sending to each manager to review, and communicating increases to employees.”

By embracing every part of the organization playing a role in setting and communicating compensation, HR can lead efficient and secure processes to support merit cycles.

Merit cycles are complex endeavors — even more so as your company grows. When HR teams have to manage the process via spreadsheet each point of communication, decision, and change represents manual time required to ensure accuracy. Before implementing Team, PayScale client Margarita Navarro noted “Each increase cycle took me 16 hours a week for four months. That’s 256 hours! I was building the spreadsheets from beginning to end, correcting, modifying, updating, sending to each manager to review, and communicating increases to employees.”

By embracing every part of the organization playing a role in setting and communicating compensation, HR can lead efficient and secure processes to support merit cycles.

SECURITY

SECURITY

With pay equity at the forefront of today’s cultural dialogue, it’s critical to ensure your data and compensation communication is secure. While no company aims for inequity, a valid pay equity case doesn’t have to prove active and intentional discrimination. Pay inequity is commonly the result of unconscious bias.

The way the Equal Pay Act is worded also doesn’t require that women have to make less than men systemically in an organization for a lawsuit to be viable. You only need one instance of a woman making less than a man in the same role with similar responsibilities to be in violation of the Equal Pay Act — or any non-qualification-based difference, for that matter.

As managers and HR practitioners come together to execute merit cycles, having processes that ensure your data and communication is secure is critical.

PayScale adheres to the ISO/IEC 27002 family of security controls, creating a systematic approach to identifying risk and managing sensitive company information. By regularly conducting security risk assessments we ensure potential vulnerabilities are identified and resolved before impacting our clients.

With pay equity at the forefront of today’s cultural dialogue, it’s critical to ensure your data and compensation communication is secure. While no company aims for inequity, a valid pay equity case doesn’t have to prove active and intentional discrimination. Pay inequity is commonly the result of unconscious bias.

The way the Equal Pay Act is worded also doesn’t require that women have to make less than men systemically in an organization for a lawsuit to be viable. You only need one instance of a woman making less than a man in the same role with similar responsibilities to be in violation of the Equal Pay Act — or any non-qualification-based difference, for that matter.

As managers and HR practitioners come together to execute merit cycles, having processes that ensure your data and communication is secure is critical.

PayScale adheres to the ISO/IEC 27002 family of security controls, creating a systematic approach to identifying risk and managing sensitive company information. By regularly conducting security risk assessments we ensure potential vulnerabilities are identified and resolved before impacting our clients.

MANAGER-EMPLOYEE COMMUNICATION

Providing the right mix of compensation to attract and retain top talent is only part of compensation best practices. Equally important is how compensation practices are communicated, understood and perceived by an organization’s employees. You can have an extremely organized and data-driven process for determining pay as well as a superior culture with generous benefits, but if you don’t equip managers to explain it to employees, they aren’t going to be able to appreciate it, and you won’t realize as much value from it.

Don’t assume that employees know what is considered competitive pay for your industry and company size. Talking to your employees about how you compete in the market, what this means for pay decisions, why employees are paid what they are for their positions, and what market data you used to determine pay is essential for improving engagement and narrowing the corporate chasm.

Don’t assume your managers are equipped to make compensation decisions without effective tools and processes to support them. Moreover, if you have the tools dialed in, make sure your managers are trained to talk about your company’s compensation philosophy, policies, and provide clear rational for pay decisions.

But in order to share total compensation statements with employees, you have to trust your managers to have these conversations effectively. Unfortunately, trust in managers to have pay conversations continues to be low. Most organizations don’t trust their managers to have tough conversations about pay with employees.

Even when organizations do train managers, only 55 percent train managers on how to have specific compensation conversations.

Even though there’s a clear opportunity to improve pay communications through manager training, having the right tools in place to enable and support managers is the first step.

But in order to share total compensation statements with employees, you have to trust your managers to have these conversations effectively. Unfortunately, trust in managers to have pay conversations continues to be low. Most organizations don’t trust their managers to have tough conversations about pay with employees.

Even when organizations do train managers, only 55 percent train managers on how to have specific compensation conversations.

Even though there’s a clear opportunity to improve pay communications through manager training, having the right tools in place to enable and support managers is the first step.

BUILDING TRUST AND DRIVING ENGAGEMENT PAYSCALE TEAM

PayScale Team is an Insight Lab software add-on that gives HR and compensation leaders the ability to include people managers in employee pay decisions. By equipping managers with the tools they need, Team improves communication and streamlines workflows. With Team, compensation increase cycles move from an arduous function to an empowering experience for both managers and employees.

BUILDING TRUST AND DRIVING ENGAGEMENT
PAYSCALE TEAM

PayScale Team is an Insight Lab software add-on that gives HR and compensation leaders the ability to include people managers in employee pay decisions. By equipping managers with the tools they need, Team improves communication and streamlines workflows. With Team, compensation increase cycles move from an arduous function to an empowering experience for both managers and employees.

Team equips HR leaders to demonstrate the value of strategic compensation across all areas of the business — supporting manager-employee communication, building trust, and driving engagement.

EMPOWER MANAGERS AND ENGAGE EMPLOYEES

Deliver a shared understanding of your compensation strategy at scale.

Give managers the ownership to lead and engage their teams.

INCREASE COLLABORATION AND REDUCE RISK

Eliminate cumbersome spreadsheets and email that present risk to the business

Ensure secure, easily referenceable communication between HR and managers.

STREAMLINE WORKFLOWS AND BUILD CONFIDENCE

Configure workflows, budgets, and approvals to serve your organization's unique needs.

Stay in control with structured decision-making and approvals led by HR teams.

PayScale Professional Service teams work in partnership with HR and compensation leaders to deliver manager training. Supporting more effective pay conversations and offering guidance on how to communicate company policies and pay philosophy.

REQUEST A DEMO TODAY

EMPOWER MANAGERS AND ENGAGE EMPLOYEES

Deliver a shared understanding of your compensation strategy at scale.

Give managers the ownership to lead and engage their teams.

INCREASE COLLABORATION AND REDUCE RISK

Eliminate cumbersome spreadsheets and email that present risk to the business

Ensure secure, easily referenceable communication between HR and managers.

STREAMLINE WORKFLOWS AND BUILD CONFIDENCE

Configure workflows, budgets, and approvals to serve your organization's unique needs.

Stay in control with structured decision-making and approvals led by HR teams.

PayScale Professional Service teams work in partnership with HR and compensation leaders to deliver manager training. Supporting more effective pay conversations and offering guidance on how to communicate company policies and pay philosophy.

REQUEST A DEMO TODAY

SEE HOW PAYSCALE TEAM CLIENTS SAVE TIME, EMPOWER MANAGERS, AND ENGAGE EMPLOYEES

MARIANI PACKING COMPANY

DEMONSTRATES ROI WITH $25,000 EVERY YEAR

For Margarita Navarro, Mariani’s spreadsheet-managed increase cycle required hundreds of hours every year and frustrated managers.

With Team, managers and administrators can manage increases from anywhere in the world, at any time and the process is secure. “Before Team, our VP of Sales needed access to VPN to manage the increase cycle,” said Navarro. “Today, he doesn’t have to worry about spreadsheets. He can do increases from Japan, from anywhere.”

READ THE CASE STUDY

INDUSTRY

Agriculture

EMPLOYEES

410

REGION

Global

For Margarita Navarro, Mariani’s spreadsheet-managed increase cycle required hundreds of hours every year and frustrated managers.

With Team, managers and administrators can manage increases from anywhere in the world, at any time and the process is secure. “Before Team, our VP of Sales needed access to VPN to manage the increase cycle,” said Navarro. “Today, he doesn’t have to worry about spreadsheets. He can do increases from Japan, from anywhere.”

INDUSTRY

Agriculture

EMPLOYEES

410

REGION

Global

READ THE CASE STUDY

AMYRIS

ATTRACTS AND RETAINS TOP TALENT

For Andrea Morales, VP of Total Rewards and HRIS, outdated technology, ad hoc spreadsheets, and a lack of visibility created a disconnect between what HR was recommending and what managers were communicating to employees.

Driven by a request from the CEO to “bring innovation to HR,” Morales and her team conducted a search for a new compensation solution—and discovered PayScale. “One of the reasons I left my previous role is that I wanted to go somewhere where there was a great culture and bring great HR strategies to that culture to make it complete. PayScale’s tools are nimble, constantly evolving, and driving the direction of the market. With Team, we can see everything in real time as we move through the process,” said Morales. “For managers to be able to see their employees on one page, who is trailing, who is leading, who is at the top of their pay band—it’s a complete game changer.”

READ THE CASE STUDY

INDUSTRY

Biotechnology

EMPLOYEES

550

REGION

Global

For Andrea Morales, VP of Total Rewards and HRIS, outdated technology, ad hoc spreadsheets, and a lack of visibility created a disconnect between what HR was recommending and what managers were communicating to employees.

Driven by a request from the CEO to “bring innovation to HR,” Morales and her team conducted a search for a new compensation solution—and discovered PayScale. “One of the reasons I left my previous role is that I wanted to go somewhere where there was a great culture and bring great HR strategies to that culture to make it complete. PayScale’s tools are nimble, constantly evolving, and driving the direction of the market. With Team, we can see everything in real time as we move through the process,” said Morales. “For managers to be able to see their employees on one page, who is trailing, who is leading, who is at the top of their pay band—it’s a complete game changer.”

INDUSTRY

Biotechnology

EMPLOYEES

550

REGION

Global

READ THE CASE STUDY

FUTABA

SAVES TIME AND IMPROVES EMPLOYEE TRUST

For Julie Mathis and Futaba’s total U.S. HR Department of two, managing the annual increase cycle was a “spreadsheet nightmare.” A key part of the decision to use PayScale was Mathis’ desire to put the responsibility for compensation decisions back where they belong: with managers.

“The first year I was here, I heard a lot of pay decisions being explained away by the phrase ‘HR said’ or ‘HR reviewed it.’ No, that’s not how compensation works. It is HR’s Job to be a resource and give managers information they need to make an informed decision about pay. PayScale enables me to do that.”

READ THE CASE STUDY

INDUSTRY

Electronics

EMPLOYEES

112

REGION

Global

For Julie Mathis and Futaba’s total U.S. HR Department of two, managing the annual increase cycle was a “spreadsheet nightmare.” A key part of the decision to use PayScale was Mathis’ desire to put the responsibility for compensation decisions back where they belong: with managers.

“The first year I was here, I heard a lot of pay decisions being explained away by the phrase ‘HR said’ or ‘HR reviewed it.’ No, that’s not how compensation works. It is HR’s Job to be a resource and give managers information they need to make an informed decision about pay. PayScale enables me to do that.”

INDUSTRY

Electronics

EMPLOYEES

112

REGION

Global

READ THE CASE STUDY

LEARN MORE ABOUT PAYSCALE TEAM
SCHEDULE A DEMO

LEARN MORE ABOUT PAYSCALE TEAM
SCHEDULE A DEMO

Whether you’re a PayScale client or are looking at compensation technology for the first time, PayScale Team helps HR leaders drive strategic compensation across all areas of the business by:

  • Strengthening manager-employee communication
  • Improving security
  • Streamlining HR processes
  • And much more