SALARY STRUCTURES: WHAT ARE THEY GOOD FOR?

Established salary structures aren’t mandatory. There is no law that requires them, but they serve many useful purposes. Having salary ranges in place can ensure that salary decisions, from new hires to promotions, are made with objective and consistent rules and parameters. They provide at least a first line of defense against salary discrimination, intentional or otherwise, by ensuring that employees performing the same job are granted the same salary opportunity. And, formal salary ranges provide you with a tool for proactively managing and budgeting your salary dollars.

Salary structures help ensure that pay levels for groups of jobs are competitive externally and equitable internally. A well-designed salary structure allows management to reward performance and skills development and control overall base salary cost by providing a cap on the range paid.

A salary structure enables employers to pay employees in a given position, consistently, for the work they do. Salary ranges also offer flexibility enabling a company to pay higher in the range for an employee based on a greater level of education, experience or performance. In the same way, it can potentially save on labor costs when hiring employees with limited backgrounds.

Having well documented and communicated salary ranges can minimize employees’ pay equity concerns and grievances.

A well-designed salary structure will help organizations:

Attract and retain suitable, qualified, and experienced employees
Build high morale with internal equity
Create more satisfied employees and thus reduce turnover
Minimize favoritism and bias
Provide a structure for career progression
Serve as a sound basis for collective bargaining and employee relations management

If the salary structure gets out of sync with the overall labor market, a company may find itself paying employees too much and needlessly increasing operating costs, or paying employees

too little and having difficulty attracting and retaining talent.

A study of the current labor market will provide new information to determine whether the organization’s pay structure, policies and practices, job classifications and job titles are appropriate or needing adjustment.

WageWatch offers accurate, up-to-date HR metrics, benefit survey data, market compensation data and salary reports that will allow you to stay current with the times. This information is highly beneficial in creating the best salary and benefits packages that meet or rival the industry standards. The PeerMark™ Wage Survey is the only Web-based custom survey tool that allows individual survey participants to select their competitive set for comparison purposes. Our experienced compensation consultants can assist with your organization’s compensation needs. We can help you ensure internal equity and compliance with regulations as well as help you structure your compensation programs to support your company’s business strategy and objectives. For more information on our services, including consulting, salary survey data, benefit survey data and market compensation reports, please call WageWatch at 888-330-9243 or contact us online.

MERIT BUDGET ALLOCATION

A primary goal of any compensation program is to motivate employees to perform at their best. Most organizations have to pay for performance at least in the form of a merit pay system. An accurate, reliable, and credible performance-appraisal program that is aligned with company goals, core values, and industry best practices is the foundation of a successful merit pay program. Performance measures should be tailored specifically for the organization and its jobs with clear outcomes that minimize bias and misinterpretation. Consistency, manager training, effective communications, and a periodic review are also essential for success.

The merit pay budget has two aspects to it: 1) determining the size of the budget and 2) allocating the budget to organizational units and its employees. Determining the size of the budget will be based on competitive trends, the organization’s financial situation and other factors that may impact pay such as minimum wage and cost of living changes. For the past several years merit budgets have been small and therefore it has been a challenge to adequately reward top performers as well as those that are rated ‘Good’ and ‘Average’. Employees with performance ratings of ‘Good’ and ‘Average’ can be the largest percentage of employees and therefore the backbone of the workforce. These employees should not be overlooked but raises for these employees often do not keep up with the cost of living. Also, the differentials between performance levels may not be large enough to motivate and retain employees. These factors reduce the motivational potential of the merit pay program.

Using a merit increase matrix may help to maintain internal equity but may not properly reward top performers. You want your reviewing managers to be engaged in the merit award process and to give appropriate thought and consideration to their pay decisions. A certain amount of guidance and training is needed but the merit matrix can be too structured and rigid as well as make it too easy for reviewing managers to simply follow the formula rather than spend the time and effort for a thorough review. Greater rewards for top performers and a greater deviation of awards between good and average performers can be accomplished by providing zero increases to employees whose performance falls below average. Providing broad increase guidelines in lieu of a matrix to your reviewing managers using factors such as performance rating, time in position, and position in salary range can eliminate the rigidity of the merit matrix and drive a more thoughtful approach to the merit award process. Once tentative award amounts are determined, reviewing managers should perform an analysis of the awards looking at the whole department and at each individual award using these and other factors as well as any unique or special circumstances.

Annual pay increases not only help keep employees’ pay at market, providing awards that are accurately linked to performance are important in retaining employees, especially your best ones. Compensation frequently emerges as a driver of retention, and when pay increases aren’t provided regularly and fairly, it will negatively impact job satisfaction.

At WageWatch our compensation consultants are focused on your organization’s compensation needs and ready to help you ensure that your compensation programs are supporting your company’s business strategy and objectives and that your pay practices are fair, equitable and non-discriminatory. We can provide your business with compensation surveys and salary reports to help you establish a budget for your merit pay program, including bonuses and incentives. Our innovative company is a leader in the collection of data for surveys and salary reports, which allows us to provide services to a wide range of industries in both the private and public sector. To learn more about our compensation surveys, salary reports, and other services please call 480-237-6130 or contact us online.

ALIGNING COMPENSATION WITH COMPANY CULTURE

Many organizations today are focusing on their company’s culture including determining their culture, deciding what it should be, aligning with strategic goals, and transitioning to the desired culture. Culture is important because it reinforces the values of the organization, which in turn shapes team members’ behavior. There are many success stories of companies with cultures that are aligned to their business goals including Google, Zappos, and Patagonia. These companies have not only developed a culture that supports their business but they have fully embraced their culture.

Organizational culture is the collective behavior of the people who are part of the organization and has important effects on the morale and motivation of the organizational members. It includes the values, norms, systems, beliefs, attitudes, and habits of the organization which impacts the interactions of the employees with each other, and with customers. Even before you define it, you know it is there and that it has an impact on your business. This is why it is so important to internalize the culture and understanding when company activities are in sync or not in sync with the culture.

Once the company values and desired culture are defined, compensation can support and help drive the values and corporate culture. The role of compensation in an organization and the compensation strategy need to be well-defined. For example, where does the organization want to set pay levels in comparison to the competitive market? Perhaps the organization’s culture is strong in training and developing its employees, acknowledging their successes and offering advancement opportunities. This, in turn, may allow the organization to set lower pay levels than what is paid in the market. Of course, when recruiting it is important to align the compensation strategy to support the values of the culture through highlighting performance management, performance appraisals, and the goal-setting process for each team member.

Once values, business objectives, and desired behaviors are determined then compensation plans can be put in place to support the culture. For example, if the business objective is innovation and the desired behavior is risk-taking, then short term incentives may be the compensation strategy. If the goal is for a highly trained workforce and the behavior is learning and upgrading skills, then skill or competency-based pay may be the compensation strategy.

Corporate culture is about people’s behaviors – how goals are accomplished – so to establish a culture that drives company success, organizations should link a significant component of their compensation systems to behaviors.

At WageWatch our compensation consultants can assist with your organization’s compensation needs and help you ensure that your compensation programs are supporting your company’s business strategy and objectives. WageWatch also offers accurate, up-to-date benefit survey data, market compensation data and salary reports that will allow you to stay current with the times. This information is highly beneficial in creating the best salary and benefits packages that meet or rival the industry standards. For more information on our services, including consulting, salary survey data, benefit survey data and market compensation reports, please call WageWatch at 888-330-9243 or contact us online .

TRUMP LABOR BOARD PROPOSES EMPLOYEE FREE CHOICE ELECTION PROTECTIONS

In the middle of August, the National Labor Relations Board (NLRB) published a Notice of Proposed Rulemaking to amend Part 103 of the NLRB’s Rules and Regulations. The proposed amendment, published in the Federal Register, seeks public comment on amendments that will provide better protection to employee election rights to have a free choice on whether to be represented by a union for collective bargaining with employers. Three amendments are proposed:

Blocking Charges: The amendment seeks to replace the current blocking charge policy with a “vote-and-impound” procedure. Elections would no longer be blocked by pending unfair labor practice charges, perhaps for years. Rather, the amendment would provide for voting, and the ballots would be impounded until the unfair labor practice charges are resolved.
Voluntary Recognition Bar: The Board proposes returning to the rule of Dana Corp. (2007), which provides that for voluntary recognition to bar a subsequent representation petition-and for a post-recognition collective-bargaining agreement to have contract-bar effect- the unit employees must receive notice that voluntary recognition has been granted, and provided a 45-day open period within which to file an election petition.
Section 9(a) Recognition in the Construction Industry: The rule amendment proposes changes in the construction industry, where less-than-majority employee support bargaining relationships established under Section 8(f) cannot bar petitions for a Board election. To bar an election based upon an alleged Section 9(a) relationship, positive evidence of majority employee support will be required, and cannot be based on contract language alone, overruling Staunton Fuel (2001).

Board Chairman John F. Ring stated: “There are few more important responsibilities entrusted to the NLRB than protecting the freedom of employees to choose, or refrain from choosing, a labor organization to represent them, including by ensuring fair and timely Board-conducted secret ballot elections. We believe that the changes we propose today further the goal of protecting this vital freedom.”

Public comments must be submitted within 60 days of the Notice’s publication in the Federal Register. Please contact Spognardi Baiocchi, LLP if you would like to retain the firm to submit comments on behalf of your organization.

Contributed by guest author: Spognardi Baiocchi LLP, a law firm dedicated to partnering with companies of all sizes to find solutions for labor, employment, human resources, and general business needs. www.psb-attorneys.com.

WageWatch offers accurate, up-to-date benefit surveys, salary surveys and pay practice data that will allow you to stay current with the times. This information is highly beneficial in creating the best salary and benefits packages that meet or rival the industry standards. For more information on our services, please call WageWatch at 888-330-9243 or contact us online.

2019 U.S. HOTEL CORPORATE EXECUTIVE COMPENSATION SURVEY–NOW AVAILABLE

WageWatch conducted a National 2019 U.S. Hotel Corporate Executive Compensation Survey. Participants invited to participate in the survey included WageWatch U.S. Hotel Survey Customers as well as other U.S. Hotel Companies.

The final report is NOW AVAILABLE for purchase. The price of the report is $1,000, with a 50% discount to WageWatch Survey Customers. Survey respondents received a complimentary copy of the report in exchange for their participation.

The report is designed to provide you with current and credible compensation information for Senior-Level Executives. It is a useful tool that provides valuable information when making investment decisions tied to attracting and retaining high-performing executives. The survey report includes Hotel C-Suite, top Executive positions in all disciplines, and Regional Executive positions. All compensation elements were included in the survey i.e., base pay, incentives, stock, medical, and retirement benefits. Participant and proxy data included in the report is based on a total of 31 U.S. Hotel Companies.

The data in the report complies with DOJ anti-trust regulations. Compliance includes the information being aggregated to protect the identity of the underlying sources, and sufficient sources are aggregated to prevent competitors from linking specific data to an individual source.

WageWatch appreciates the opportunity to serve its customers across multiple industries including hospitality, gaming/tribal gaming, healthcare, golf course/country club, and higher education. Since 2001, our customers rely on WageWatch to provide them with consistent, reliable, and up-to-date compensation survey statistics for their industry on a local, regional, and national level.

To receive a copy of the report, contact us by phone: 888-330-9243, or by email: custserv@wagewatch.com.

EFFECTIVE NEW HIRE ORIENTATION

An employee’s experience during their first few days will affect the rest of their tenure. It is critical, to begin with an effective, positive, and fun new hire orientation for the future success of your new employees. Even before the employee’s hire date, you can make a positive impact with a call to the employee two or three days before their start date, welcoming them, letting them know what time to arrive, and what they can expect during their first day and first week on the job. Studies show that a well-planned orientation can contribute to the length of employment, better work attitudes, more effective communication, and fewer mistakes. Your new hire orientation is your chance to set a positive tone for a long-lasting and mutually beneficial relationship.

A new hire’s early experience is highly influenced by his peers, managers, subordinates, HR team members, and the organization’s top management. Ensure that new hires are welcomed by their team members. Plan a welcome breakfast meet and greet for their first morning on the job. The new hire’s immediate supervisor should schedule daily meetings with the new employee at least for the first week, then at least weekly for the first month or two. Schedule informational meetings with key people in the department and in other departments to provide the new hire with the general knowledge that they will need to perform their job. Include an office tour in the orientation process that includes introductions. Be sure to include introductions to top Executives, Human Resource personnel as well as receptionists, administrative assistants, and copy/mail room attendants.

An effective orientation program will put emphasis on the new employee, their individuality and what they have to offer rather than focusing solely on the company’s culture and how the new employee can fit in. You are probably hiring in part to get new ideas into the organization. Make sure to capitalize on that. Make your orientation meetings fun and be sure to provide a meal or at least snacks. Keep it interesting and not too long. Too much information will be boring and will not be retained. Orientation should reflect culture through interactive activities. One way to make it memorable is to present the company’s goals, mission, and values in an activity form rather than simply providing the information. Allow the new hires to get to know each other on a personal basis, not just professional – go around the room and have them tell one professional and one personal thing about themselves. You can also turn this into a game by writing one thing about each person on a piece of paper. In the end, state items one at a time, out of order, and have people guess who said what.

Promote communication with a team-building activity such as learning the employee handbook through a scavenger hunt. For example, divide the orientation group into teams and see which team can answer the most handbook questions in a set amount of time. Cover company ethics to let them know what is expected, and also include ‘unwritten rules’. Don’t end there! After orientation, schedule follow-up meetings with each new hire to elicit their feedback and answer any follow-up questions they may have.

Don’t forget the basics. Provide them with all the office supplies they will need to start their job, include contact information they will need. And let them know how to get additional office supplies. Teach them how to use the phone, how to forward calls, set up and change voice mail, and how to do a conference call.

Today, many companies are adding programs such as flex-time, telecommuting as well as accommodating and encouraging alternative work styles in an effort to provide a work environment where employees are happier and thriving. Therefore don’t neglect or underestimate how impactful beginnings are, and provide your new hires with an orientation program that is effective and unique to your company and its culture.

Implementing the above suggestions will help your company to build a culture that encourages the retention of employees, which in turn will attract top talent. In addition to providing a great work environment that respects employees and provides opportunities for learning and growth, it is also important that they receive a solid compensation and benefits package. At WageWatch we offer accurate, up-to-date benefit survey data, market compensation data and salary reports that will allow you to stay current with the times. This information is highly beneficial in creating the best salary and benefits packages that meet or rival the industry standards. For more information on our services, including consulting, salary survey data, benefit survey data and market compensation reports, please call WageWatch at 888-330-9243 or contact us online.

PREGNANCY DISCRIMINATION STILL HAPPENING AND STILL ON THE EEOC RADAR

You would not think this would still be an issue in today’s day and age, but it is! The EEOC has recently settled two cases in August against employers (one in Florida and one in Arizona) for discriminating against women who were pregnant.

In the Arizona matter, Matrix Medical, a nationwide health care company headquartered in Scottsdale, Arizona, found itself in trouble with the EEOC after it rescinded a job offer to a candidate within a week of finding out she was pregnant. Matrix will pay $150,000 and issue a letter of apology to the individual. Matrix is also required to review and revise its equal employment opportunity policies and its personal leave-of-absence policy to include a provision that pregnant employees may take leave during their first six months of employment. As part of the settlement, it is also required to train its supervisors on Title VII and other anti-discrimination laws.

In another matter in Florida, the Glenridge on Palmer Ranch, an upscale retirement community in Sarasota, Florida failed to further interview an applicant for a position after asking her when she planned on having another baby. Instead, Glenridge offered the position to another female, an older one for whom it did not believe would or could become pregnant. Glenridge will pay $70,000, adopt and distribute an updated policy against sex discrimination, conduct annual training on sex discrimination for its hiring officials, and post a notice about the lawsuit in order to settle its matter with the EEOC.

This is a good reminder for employers to make sure that their hiring managers are asking appropriate, open-ended questions when interviewing candidates. It is also a good time to remind those same hiring managers that he or she should not rely upon or use inappropriate information revealed during an interview to make a decision on hiring.

WageWatch offers accurate, up-to-date benefit surveys, salary surveys, and pay practice data that will allow you to stay current with the times. This information is highly beneficial in creating the best salary and benefits packages that meet or rival the industry standards. For more information on our services, please call WageWatch at 888-330-9243 or contact us online.

GET MORE OUT OF YOUR TURNOVER METRIC

Most HR departments miss an opportunity when it comes to measuring and reporting turnover. The goal of any HR metric is to provide information on how to improve the measured item. As Peter Drucker said, “what gets measured gets done.” Reporting turnover as simply a percentage of the workforce can be made more meaningful and more useful by diving down into the detail and adding data and information that quantifies the cost and provides insight on root causes and how to make improvements. Some examples of this are:

Along with your company’s turnover rate, add the turnover rate of competitors, giving a baseline or something to compare against
Add the percentage of turnover that was top performers or top salespeople, the percent of turnover in each department and for each manager, the percent in high impact jobs and hard to fill jobs
Add the percentage of turnover in the first year of employment, which can be linked to possible employee dissatisfaction
Add how long it takes to fill positions, the recruitment cost of filling the positions, and how long before they are up to the minimum productivity level
Add exit interview information such as how many went to work for competitors and which competitors. Exit interviews may also indicate whether turnover was preventable, which may, in turn, provide managers with information needed for improvement
Add the dollar impact of lost sales where applicable, i.e., sales turnover, which can be directly linked to revenue and economic impact on the company

The involuntary turnover metric is also important. It can indicate that the company is keeping low performers which can also be costly. With this additional information, conclusions are now more easily drawn and the cost of turnover is more tangible (i.e., the cost of losing individuals in key positions is likely higher than losing individuals in low-impact positions). If losing hard to fill jobs, the job market may be tight and replacing these employees could be expensive. Losing individuals with strong reputations within the industry can impact stock analysts’ assessments of your firm. It can also send negative signals throughout your firm and the industry, which can, in turn, lead to more turnover.

Some additional information that can be helpful when included with the turnover report, include:

Leading causes of preventable turnover
Satisfaction or frustration levels of those who left which could impact the company’s external image
Lowest turnover rates within the firm which can provide a target for managers to aim
The likelihood that the person that left will take others with them

Today’s world moves fast, and as an employer, you should constantly be monitoring and adjusting your business operations to meet the ever-changing wants and needs of your employees. At WageWatch, we offer accurate, up-to-date salary survey reports and pay practice reports that will allow you to stay current with the times. This information is highly beneficial in creating the best salary and benefits packages that meet or rival the industry standards. For more information on our services, including market compensation data, benefits survey data and salary reports, please call WageWatch at 888-330-9243 or contact us online.

WHEN DOES SALARY MOTIVATE EMPLOYEES?

Studies have shown that salary can just as easily de-motivate employees as motivate them. In fact, salaries generally operate as negative reinforcement rather than positive. For example, an employee receiving a lower than expected merit increase or bonus payment can certainly de-motivate. On the flip side, receiving the status quo merit increase or bonus amount every year can create an entitlement mentality. However, when it comes to motivating employees, salary is always one of the top factors, and therefore, it has to be part of your total rewards strategy. Many believe that the amount of money that is needed is at least enough to satisfy basic needs which vary by person. Obviously, when salary does not, at a minimum, cover essential needs, this serves to de-motivate.

In this article, the focus is on monetary rewards. Motivated employees make a difference in the workplace. They affect the work environment positively as well as improve customer service, sales, or production. So, how can you determine if the salaries you are paying are motivating your workforce?

First, determine where to focus your compensation spending plan. This can vary depending on factors such as the current economy, the competitive environment, and where the company is in its life-cycle. For example, a growing company with variable sales and income may be better off focusing on base salaries. When business is good, it may be prudent to tie more bonus dollars to goals achieved.

Second, do your research, know your competition. Every organization can benefit from reputable industry salary surveys such as the WageWatch PeerMark™ and Benchmark reports, to determine competitive salaries. You should utilize salary survey data from the local market, your industry and from organizations of similar size. Work within your organization’s salary philosophy and the given financial situation to determine where to set salaries.

In addition to looking externally to market competition, look internally to ensure your internal pay structure and salaries are fair and equitable. Whether you like it or not, employees will discuss pay with one another. Ensure fair and equitable pay levels between employees in the same jobs, in the same departments, and jobs of comparable worth within your organization. Formal salary ranges within the organization where people with similar responsibilities and authority are grouped into the same salary range help to maintain internal equity. Set clear goals for what you want to achieve by setting salaries at certain levels. For example, you may pay an entry-level manager less than the market if you are hiring inexperience and provide a training and growth opportunity in exchange. Open and clear communication regarding the company’s salary structure and pay philosophy can aid in employees’ understanding of the methods used in determining their salary level and assist in demonstrating fairness and equity.

Merit pay is one of the most frequently used methods to drive employee performance. To be effective it needs to be linked to performance in a manner that is consistent with the mission of the organization. Merit increases can become de-motivating when your performance measurement system is flawed and/or inconsistently applied or when the merit increase amount that is linked to performance is inconsistently administered. Also with merit increases typically averaging two to three percent, studies show that increases lower than five percent are unlikely to have any impact on employee performance. What can help is applying behavioral principles to your pay for performance programs such as giving employees a personal stake in the success of the company by showing a clear link between their efforts and results. Many companies base their compensation plan on time and not results. Of course, time is a factor and needs to be part of the equation. However, if you pay for results, you will get results.

Change can be challenging and demanding. At WageWatch our consultants can assist with your organization’s compensation needs and help ensure your wages and salaries support your company’s business strategy and objectives. In addition to our PeerMark™ Salary Survey for over 100 local lodging markets in the U.S. and Canada, we offer a National Benchmark Salary Survey. With over 9,000 hotels and 200 casinos in our database, WageWatch’s hotel and gaming salary surveys are the most comprehensive surveys available to Human Resouces. For more information on our services, including consulting, salary surveys, benefit surveys, and custom compensation reports, please call WageWatch at 888-330-9243 or contact us online at www.wagewatch.com/contactus.

COMPENSABLE TIME

Employers need to ensure they count all worked hours as paid hours for their non-exempt staff. For example, when an employee eats lunch at their workstation or desk and their lunch is interrupted by work such as answering phones or email, the employee is working and must be paid for that time because the employee has not been completely relieved from duty.

If the employer has a policy that is expressly and clearly communicated to the employee regarding a specific length of time for a break, any unauthorized extensions of that break time do not need to be counted as hours worked. Bonafide meal periods (typically 30 minutes or more) generally need not be compensated as work time. However, the employee must be completely relieved from duty for the purpose of eating regular meals.

The federal Fair Labor Standards Act (FLSA), doesn’t require employers to provide meal or rest breaks, though some states do require such breaks and the rules can also be different for younger workers. You can find a list of state meal and rest break laws at the Department of Labor’s website address: https://www.dol.gov/whd/state/meal.htm and https://www.dol.gov/whd/state/rest.htm.

Employers that fall under the federal guidelines do not have to pay for meal or rest breaks unless:

The employee works through or during their break, or
The break lasts 20 minutes or less, or
The break is interrupted by work

Some other compensable time under the federal rules can include waiting time, on-call time, attendance at meetings and training programs, travel time and performing work outside of work hours such as checking emails.

Waiting time may or may not be hours worked depending upon the circumstances. If an employee needs to wait before a duty can start such as a firefighter waiting for an alarm, then the employee is ‘engaged to wait’ and this time is worked time and must be paid.

On-Call time is paid time if the employee is required to remain on the employer’s premises. In most cases, the on-call time does not have to be paid when an employee is not required to remain on the employer’s premises. However additional requirements put on the on-call time that further limits the employee’s freedom could require the time to be compensated.

Attendance at meetings or training programs is paid time when any of the following conditions are true:

It is during normal hours
It is mandatory (if the employee feels that they should or need to attend, then it is mandatory)
It is job-related

Travel time may be paid time or not depending upon the kind of travel involved. Regular commute time to and from the worksite is not paid time. When the employee works at a different worksite location then any commute time that is greater than the employee’s regular commute time to their usual work site needs to be counted as paid time.

Travel that is part of the regular work duties, such as travel from job site to job site during the workday, is work time and must be counted as hours worked. Overnight travel is work time and must be paid time