Managers: On the Front Lines of Communicating Pay

January 29, 2018

Yes, you’d love it if your HR team could spend more time with employees across the company. But given your growing organization has more employees than you can consistently see on a regular basis, the internal partners you need to leverage when it comes to communicating pay decisions are your managers.

Direct managers likely see their team members on a daily basis, often working and meeting with their reports throughout the day. And given their close working relationships, managers should be leveraged when communicating compensation changes across the organization.

Managers play an important role in supporting and administering the company compensation plan, but they can’t do it well without help from you. Because of their importance, for managers, knowing how to “talk compensation” with employees is a must-have skill.

So it’s important to train your managers and give them the tools they need to have productive talks with employees about compensation. Managers are agents of the organization. Knowing how to “talk compensation” with employees is a must-have skill; considering how many ways a pay conversation can go wrong, and how irreparable the damage can be to employee engagement, preparing managers for pay conversations is crucial.

Despite this, fewer than one in five organizations are very confident in their managers’ abilities to have tough conversations about compensation, only about 19 percent. Yikes.

Fewer than 1 in 5 orgs are very confident in their managers’ abilities to have tough talks about comp.

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How can you help your managers feel more confident and speak more confidently about their compensation decisions, knowing the decisions are sound and solidly link employees’ roles and organizational goals?

When managers are informed, educated, trained and supported in compensation matters, they’re better able to handle these often-stressful conversations.

Get Specific

Managers need to be trained on the specifics of comp, not just broad concepts like communication styles and organizational performance.

Specific instruction and preparation should include:

Make sure managers understand your compensation philosophy and processes, and tie them back to potential employee concerns.
Let managers know what level of transparency your organization has decided on. For example, if it’s been decided that managers can only share with employees the pay ranges up to the employee’s level, the manager shouldn’t share higher level pay ranges; doing so may detract from a sense of fairness.
Let managers know the timeline of your comp plan; when should they have pay discussions with employees?
Let managers know what resources and data will be at their disposal when they have pay conversations. Share any toolkits or documentation you intend to prepare, such as the Total Compensation Report for employees.
Share any important communication tips you want your managers to use. For example, train them how to give feedback: they should be able to make it clear what their employee can do more to earn more, and what he or she can do to increase his or her value within the organization.

For more information on how to train managers to talk about pay with employees, check out this article 7 Do’s and Don’ts of Total Compensation Reports.