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Welcome from HR Strategy Group
We all know how current competitive conditions in the business world make it difficult to acquire and retain top talent. Knowing what to pay in the market for your talented employees is a competitive advantage. This month we offer you as our main article, Compensation Best Practices for 2014 and in our Compensation Corner, Top 5 Compensation Lessons from 2013.
Our headline article is from our friends at PayScale, Inc., the nation's largest provider of compensation data and analysis. They conduct annual compensation trend reports - and I know that you will find this information helpful as you plan your Compensation budgets. Stay competitive and know how to compensate your employees in line with market forces. Please read on...
And remember, only four weeks until the first day of Spring!
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Best,
 Amy Polefrone, President HR Strategy Group, LLC
410-505-8723
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2014 Compensation Best Practices Report: The Year of the Great Balancing Act
Through my partnership with PayScale, I am happy to provide you with access to this year's 2014 Compensation Best Practices Report. It's an easy read and includes interactive graphics to show you what your peers are doing around salaries, employee retention, and pay raises this year.
Highlights from this year's report include:
- 72% expect their company's financial situation to improve.
- Salaries will go up with 88% planning to give raises.
- Retention was listed as a top business concern by 60% of companies surveyed.
- 75% of respondents are not satisfied with the compensation data available.
Executive Summary:
Each year since 2009, we at PayScale have conducted a survey of compensation best practices to take a look at what happened in the year just ended and predict trends for the upcoming year. In analyzing this year's survey results, we saw more encouraging economic signs that we haven't see in recent years as companies are growing in size and offering raises to current employees. Yet this increased optimism comes along with a good dose of caution as most companies lack sufficient business insight to know what to pay to effectively attract and retain the right people. With the more competitive economy of 2014, companies will be challenged to balance growth with smart decisions about how to compensate talent.
To review the Complete Report, click here.
To view the Interactive Graphs, click here.
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Spot Check
Credit Reports Becoming Disfavored Tool
"Employers should generally approach the use of credit reports for employment purposes with great caution, carefully examining if such use is regulated by state law, is relevant to the job, and be on the lookout for potential future restrictions in 2014 as credit report checks continue to become a disfavored tool that could potentially disappear from the hiring landscape."
SHRM article published 01/13/14
Typically, credit reports should only be run for positions in which money is being handled (bank tellers, loan officers, Director of Finance, individuals with security clearances, etc.). In general, avoid using credit checks unless there is a demonstrable business necessity.
For more information about background checks, credit checks, pre-employment drug testing, contact Amy at 410-505-8723 or
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Top 5 Compensation Lessons from 2013
By Mykkah Herner, PayScale Blogger, 01/13/14
Last year was a year of ups, downs, and shutdowns. The Affordable Care Act is still looming over us, the impact unclear. Some but not all companies are pulling free of the recession. Employees have continued moving around more and more since the official end of the recession. Yet amidst the turmoil, there are some key lessons. Essentially, in an uncertain time, compensation plans and strategies need to be flexible. In this article I'll talk about the top 5 ways we can infuse flexibility into our program.
#1 - Know How You're Doing Relative to the Market at all Times
Some organization leaders are hesitant to do a market assessment when they're unable to give out increases. I would argue that it is almost more important to arm yourself with the knowledge of your market position when you don't have readily available funds. As the saying goes, knowledge is power - and having the knowledge of where you stand gives you the power to address issues before they become a problem.
Many of the organizations I work with are already paying fairly to the market. When we start their projects, they admit that they haven't looked at the market in a long time, thinking that if they don't look, they won't find something they don't want to see. The fact is, assuming folks were in good standing in 2009, they're probably not too too far behind now. Some things have shifted, sure, but it's better to know by how much so you can be prepared to answer questions and communicate your position appropriately to your employees. Once your employees have a sense that they're underpaid, even paying at the 90th percentile for the next 10 years won't make them change their minds. And, if you haven't been able to afford increases in a while, your employees will feel underpaid whether they are or not.
Practically speaking, if you have positions that are paid low relative to the market, target these for increases as soon as you do have funds available. Consider non-monetary rewards as a means for retention of employees in your hot jobs.
To read the rest of the article, click here.
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