This is an excerpt from our new ebook “Comp 101: A Beginner’s Guide to Compensation Management.” Download the full guide here.
Now that you’ve built and implemented your compensation plan, think about how you can keep it current year to year and between cycles.
One of the tricks of compensation planning is that it’s never truly done. As soon as you think you’ve crossed all your Ts and dotted all your Is, a well-meaning employee or manager will point out some skill or certification or priority that hasn’t been accounted for yet.
That doesn’t mean you have to go back to the drawing board; sometimes it’s helpful to draw a dotted line in the sand. Here are some suggestions to help you do just that:
- Build an evaluation process into your rollout that calls out when you intend to make adjustments to the plan, maybe after a month, a quarter or six months.
- Develop a short list of “hot jobs” that you plan to review for market movement on a monthly basis. Consider involving your managers or leaders in generating the short list.
- If you have an organization that involves managers, train them in what matters in defining jobs for compensation purposes, and have them review their job descriptions for accuracy
Consistently applying your documented pay practices is one of your best defenses against charges of pay inequity from employees and outside agencies. If you need to deviate in any way from your company’s compensation policy — such as to adjusting compensation for truly exceptional performers — document the justifications for the decision with relevant information. Continue to communicate with employees about your company’s intentions with regard to compensation.
Also, be sure you keep your plan current to the market with a regular review cycle. It’s during these larger plan reviews that you should recommit to your compensation philosophy, update your compensation strategy to the new business priorities, refresh your market data, revise and update pay ranges and fix any outdated policies and processes. Think of these major reviews as the higher level strategic reviews that help ensure that your plan is still aligned with your business goals.
Want the full step-by-step guide to compensation management? Grab your copy of the full Comp 101 guide today!
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Have you run into an unexpected problem in the midst of your compensation planning process? We want to hear from you. Share your story in the comments.
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