Intro to Compensation Planning
As businesses anticipate the new year, crafting an effective compensation structure becomes crucial. Jodi Schafer and Marcia Cornell from HRM delve into the essentials of setting up compensation plans that align with both budget constraints and legislative changes.
Developing Your Compensation Plan
Understanding each job role within your organization is the foundation of a fair compensation structure. Start with detailed job descriptions to ensure clarity and accuracy. From there, rank jobs within your organization to establish a hierarchy of value, which will guide the salary ranges.
Market Analysis and Salary Banding
A comprehensive market study will help align your internal salary ranges with the industry standards. This ensures competitiveness and fairness in compensation, helping to attract and retain top talent.
Implementing and Adjusting Compensation Structures
Once your plan is in place, the focus shifts to administration. Regular updates and adjustments will keep your compensation structure relevant and effective. Discuss how to handle employees whose salaries fall outside the new bands, whether through adjustments or maintaining current pay and utilizing flexible options such as bonuses to reward performance.
Staying Ahead: Preparing for Changes
With legislative changes like Michigan’s Earned Sick Time Act, staying proactive is more important than ever. This step will provide strategies to integrate new legal requirements into your existing compensation framework seamlessly.
Final Insights: Ensuring Long-term Success with Your Compensation Plan
It is important to view your compensation plan as a living document with ongoing attention and adjustment.