Benefits and Compensation

Strategic Comp Plan? ‘This Is Not Easy Stuff’

[Go here for #1 to #3]

#4: Competitive Reference Points

Describe the comparator group(s) for your rewards package
Determine industry/geographic competitors
For signature programs, what are the benchmarks

#5: Competitive Positioning

Describe your desired position vs. the market. If your position is below market average, be prepared to explain why. Honesty is a positive message, says Csizmar. (Be sure you walk the talk.)

Avoid false aspirational statements like “We pay at market.” when actually your ranges are at market, but your pay isn’t.

6: Internal Equity and Consistency

Will your strategy be consistent? Employees will assume yes, that they are getting fair and equitable treatment. It is a common occurrence that business necessity forces you to pay new hires more than existing employees. Be sure you are consistent and that exceptions can be explained.

If you fail here, first you lose employees’ hearts and minds, and then eventually their bodies when they up and leave.

7: Communication and Involvement

How much program information will you disclose? Key elements for sure, but not necessarily all the particular details.

Clarify HR vs. management responsibility for program design and ongoing administration. HR typically is the responsible party for rolling these programs out, Csizmar says.

If have unions, employee councils, or other similar bodies, you should indicate what the roles are and what the extent of employee involvement is.

8: Governance

State the need for revision and competitive refreshing of the strategy. Determine the frequency of review and by whom? HR should take the lead, Csizmar says.

Also for senior management, are we keeping pace with our commitment?

Get ADA compliant job descriptions for your jobs with a Free Market Analysis Report. Also receive guidance on how to use our Compensation Analyzer tool to do market analysis, identify internal and external inequities, and track compensation.

Communicate, Communicate

Then, you need to communicate:

  • Define a theme to generate interest.
  • Talk to employees, not at them.
  • Use multiple media, speaking points and Q&As.
  • Be easily understood; avoid confusion.

Sample Ministatements

Csizmar offers the following as examples of clear statements you can make about your compensation program:

  • Base salary will be targeted at the 50th percentile of the relevant competitive marketplace in which we compete.
  • Future salary increases will be based on an employee’s evaluated performance.
  • Benefit scheme provisions should be cost- and tax-effective to the company.
  • If individual performance does not meet objectives, monetary rewards will be reduced.

This Is Not Easy Stuff!

Finally, says Csizmar, this is not easy. You may expect challenges, such as:

  • It’s hard to establish consensus on what to do.
  • You can expect passive resistance (especially those who are happy with the status quo).
  • You have to have top-down support.
  • You need to monitor reality vs. plan.

It’s not easy stuff, but you can’t avoid it—your compensation strategic plan, just one of comp and benefits’ daily challenges. “Maintain internal equity and external competitiveness and control turnover, but still meet management’s demands for lowered costs.” Heard that one before?  

Many of the professionals we serve find helpful answers to all their compensation questions at, BLR’s comprehensive compensation website.

And there’s great news! The site has just been revamped in two important ways. First, compliance focus information has been updated to include the latest on COBRA, Lilly Ledbetter, and the FMLA. Second, user features are enhanced to make the site even quicker to respond to your particular needs:

  • Topics Navigator—Lets you drill down by topical areas to get to the right data fast.
  • Customizable Home Page—Can be configured to display whatever content you want to see most often.
  • Menu Navigation—Displays all the main content areas and tools that you need in a simple, easy format.
  • Quick Links—Enables you to quickly navigate to all the new and updated content areas.

The services provided by this unique tool include:

  • Localized Salary Finder. Based on reliable research among thousands of employers, here are pay scales (including 25th, 50th, 75th, and 90th percentiles) for hundreds of commonly held jobs, from line worker to president of the company. The data are customized for your state and metro area, your industry, and your company size, so you can base your salaries on what’s offered in your specific market, not nationally.

Get an ADA compliant job description, grade assignment, rate range for that job, and salary data, all customized for your industry and geography. Better news? It’s FREE. Download Your Free Market Analysis Report.

  • State and Federal Wage-Hour and Other Legal Advice. Plain-English explanations of wage-hour and other compensation and benefits-related law at both federal and state levels. “State” means the laws of your state, because the site is customized to your use. (Other states can be added at a modest extra charge.)
  • Job Descriptions. The website provides them by the hundreds, already written, legally reviewed, and compliant with the Americans with Disabilities Act (ADA) mandate that essential job functions be separated from those less critical. All descriptions carry employment grade levels to current norms—another huge time-saver.
  • Merit Increase, Salary, and Benefits Surveys. The service includes the results of three surveys a year. Results for exempt and nonexempt employees are reported separately.
  • Daily Updates. Comp and benefits news updated daily (as is the whole site).
  • “Ask the Experts” Service. E-mail a question to our editors and get a personalized response within 3 business days.

If we sound as if we’re excited about the program, it’s because we are. For about $3 a working day, the help it offers to those with compensation responsibilities is enormous.

This one’s definitely worth a look, which you can get by clicking the links below.

Click here to get more information or start a no-cost trial and get a complimentary special report!

1 thought on “Strategic Comp Plan? ‘This Is Not Easy Stuff’”

  1. “Base salary will be targeted at the 50th percentile of the relevant competitive marketplace in which we compete.” As you say, it’s not easy, so it’d probably be wise to provide your employees a real-world example of what this means.

Leave a Reply

Your email address will not be published. Required fields are marked *