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Compensation Tips
Just as business owners measure their company’s performance against their competitors, employees compare their paychecks against their colleagues. Read on for practical tips on how to inspire excellence through compensation.
Ann Clifford
Dos and Don'ts
Can you ask a candidate to provide a copy of their W-2 to verify previous compensation?
(Answer provided at the end of the newsletter.)
Widen the Gap Between the Best and the Rest
When giving raises to your employees, do you treat everyone equally or do you differentiate? To keep top talent, it is best to lean towards differentiation. Top performers like pats on the back for a job well done, but the best reward is a higher raise than those received by their mediocre co-workers.
Performance-based pay is now the trend in retaining top talent. And, it is not the amount of raise that inspires excellence; it is the differential that a company places on performance. According to a survey by consulting firm Hewitt Associates, best performers got a 9.9% raise last year. Average performers received 3.6% raises.
Follow these three (3) steps to reward and retain your top talent:Develop clear guidelines on how employee performance is measured. Define consequences for excellent, average, and poor performance. Create a significant difference between the pay of excellent and poor performers.
(By Shelli Clemens, HR Consultant, Safari Solutions; adapted from “Performance-Based Pay is a Great Retention Idea #1.)
Are Your Employees Underpaid?
How much do your employees make? Not enough, so they think! According to a survey by Salary.com, 57% of workers who are planning to look for a new job are leaving because they feel that they are underpaid. However, only 19% of these workers are actually underpaid according to the survey. In fact, 17% of those employees are overpaid.
Generally people don’t understand how their pay is connected to their industry or personal performance. Communication is the key to combating the illusion of being underpaid and the discontent that it creates. In a 2002 Mercer study, 74% of employees were satisfied with their jobs when they understood how pay was determined. Of those who didn’t understand their compensation plan, only 42% were satisfied with their job.
Suggestion: Create a compensation plan based on measurable goals and industry standards. Explain the plan to your employees. Refer to your plan when awarding raises and making offers.
(By Allison Hall, HR Consultant, Safari Solutions )
Safari Interview Tip
Do you want to know a candidate’s current salary? If so, ask directly . . . “What is your current or most recent compensation?” If a candidate is reluctant to answer, ask . . . “We want to make sure we are in the same ballpark so we don’t waste your time or ours. Could you give me a range that your compensation falls within?”
Safari Success Story
Growth has sparked active hiring by Mann Properties! With the assistance of Safari Solutions, they hired four new employees last year . . . Receptionist, Assistant Development Coordinator, Professional Engineer, and Landscape Architect. All are actively contributing to the company's success!
Did You Know
According to a CareerBuilder poll, 6 out of 10 hiring managers are willing to sweeten a hiring offer once for a desirable candidate. But, 90% will rule out subsequent salary negotiations.
Safari Quiz
Which area do companies spend the majority of their recruitment sourcing dollars?
A. General Job Boards
B. Company Career Sites
C. Newspaper ads
D. Employee Referrals
Click Here for the Answer.
Answer to Today's Dos and Don'ts
"Can you ask a candidate to provide a copy of their W-2 to verify previous compensation?"
Verifying compensation is an important part of the hiring process, both when qualifying candidates and preparing an offer. Asking for W-2 information is legal, although it sometimes makes candidates uncomfortable. Inform the candidate that you need the information to ensure the most competitive offer, thus avoiding frustrating salary negotiations. Another option is to speak with former employers. HR personnel are often able to release salary information, or provide a general range for the position they held.
(Source: Allison Hall, HR Consultant, Safari Solutions)
Ann Clifford
Dos and Don'ts
Can you ask a candidate to provide a copy of their W-2 to verify previous compensation?
(Answer provided at the end of the newsletter.)
Widen the Gap Between the Best and the Rest
When giving raises to your employees, do you treat everyone equally or do you differentiate? To keep top talent, it is best to lean towards differentiation. Top performers like pats on the back for a job well done, but the best reward is a higher raise than those received by their mediocre co-workers.
Performance-based pay is now the trend in retaining top talent. And, it is not the amount of raise that inspires excellence; it is the differential that a company places on performance. According to a survey by consulting firm Hewitt Associates, best performers got a 9.9% raise last year. Average performers received 3.6% raises.
Follow these three (3) steps to reward and retain your top talent:
(By Shelli Clemens, HR Consultant, Safari Solutions; adapted from “Performance-Based Pay is a Great Retention Idea #1.)
Are Your Employees Underpaid?
How much do your employees make? Not enough, so they think! According to a survey by Salary.com, 57% of workers who are planning to look for a new job are leaving because they feel that they are underpaid. However, only 19% of these workers are actually underpaid according to the survey. In fact, 17% of those employees are overpaid.
Generally people don’t understand how their pay is connected to their industry or personal performance. Communication is the key to combating the illusion of being underpaid and the discontent that it creates. In a 2002 Mercer study, 74% of employees were satisfied with their jobs when they understood how pay was determined. Of those who didn’t understand their compensation plan, only 42% were satisfied with their job.
Suggestion: Create a compensation plan based on measurable goals and industry standards. Explain the plan to your employees. Refer to your plan when awarding raises and making offers.
(By Allison Hall, HR Consultant, Safari Solutions )
Safari Interview Tip
Do you want to know a candidate’s current salary? If so, ask directly . . . “What is your current or most recent compensation?” If a candidate is reluctant to answer, ask . . . “We want to make sure we are in the same ballpark so we don’t waste your time or ours. Could you give me a range that your compensation falls within?”
Safari Success Story
Growth has sparked active hiring by Mann Properties! With the assistance of Safari Solutions, they hired four new employees last year . . . Receptionist, Assistant Development Coordinator, Professional Engineer, and Landscape Architect. All are actively contributing to the company's success!
Did You Know
According to a CareerBuilder poll, 6 out of 10 hiring managers are willing to sweeten a hiring offer once for a desirable candidate. But, 90% will rule out subsequent salary negotiations.
Safari Quiz
Which area do companies spend the majority of their recruitment sourcing dollars?
A. General Job Boards
B. Company Career Sites
C. Newspaper ads
D. Employee Referrals
Click Here for the Answer.
Answer to Today's Dos and Don'ts
"Can you ask a candidate to provide a copy of their W-2 to verify previous compensation?"
Verifying compensation is an important part of the hiring process, both when qualifying candidates and preparing an offer. Asking for W-2 information is legal, although it sometimes makes candidates uncomfortable. Inform the candidate that you need the information to ensure the most competitive offer, thus avoiding frustrating salary negotiations. Another option is to speak with former employers. HR personnel are often able to release salary information, or provide a general range for the position they held.
(Source: Allison Hall, HR Consultant, Safari Solutions)
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