Originally posted on PeopleFluent.com July 15, 2013.
People Have GOT to Get Paid!
With all the talk about employer branding, big data and talent management, it’s easy to forget that one of the most basic building blocks of hiring and retaining the very best has to do with the humble paycheck. While it’s not the flashiest subject, pay ranges are important. Yes, still! While money isn’t the only thing that candidates are looking at as they browse employers, (most of us) aren’t running volunteer organizations at the moment. So it’s time to take an in-depth look at pay ranges and how to stay competitive in a post-recession world!
With the practice of pay transparency on the rise, and the social climate that has us all talking and connecting, the ball park of anyone’s given pay is likely not a secret. In turn, employers are being coaxed into more fair compensation practices with floors and ceilings to match the industry and geographical rates. It doesn’t take more than a quick Google search for candidates to get a clear picture of their earning potential in any given field or industry. Armed with this knowledge, some candidates and employees are quickly seeing what their worth is…or could be. How do HR professionals stay on top of this growing trend?
When employers and candidates work together to consider location, commute, benefits and advancement opportunities, they can come up with fairly reasonable numbers. While this sort of collaboration isn’t always easy when hiring vast numbers of employees or when hiring quickly, being transparent with compensation policies is now a necessity. It can get a little awkward, but companies should get comfortable, because compensation transparency isn’t going away.
Resources for Establishing Pay Ranges
Current salary ranges don’t just come out of a hat. Some research needs to be done on a regular basis to ensure up-to-date, fair compensation ranges. The research should include factors like industry needs, organization type and location. When considering doing this for most of the given positions in an organization, the task can be daunting, but reasonable and fair pay transparency can be a great tool in attracting and retaining top talent. It can cut down on wasted time during the talent acquisition process and create a way for applicants to self-select out of the process if the compensation and benefits packages are not what they were expecting. Contrast this with the “hold it close” philosophy of many companies that causes the offer to be the point at which one or more parties simply walks away, leaving weeks of effort on the table..
What tools the company will use will depend on the size and budget of the organization. Some commonly used tools that provide accurate information about current salary ranges are:
• Traditional Surveys: Easy to access and (mostly) free to use, surveys from organizations or the government lend some great insight. Because no two organizations are alike, companies should take these numbers with a grain of salt and fairly gauge difference to be taken into account. Be mindful of the date of these surveys. Only recent information needs to be gathered, so check the dates on the surveys and consider that if your home office is in Norfolk, Nebraska, your needs and compensation parameters will be decidedly different than a similar company in San Jose, California. Read more…