As you return to the office in 2014, before you dive right in, take the opportunity to step back from the day to day duties, reflect on the year that just passed and start the new year with a new perspective. Taking some time to plan your compensation calendar in the year ahead can help you stay organized, stay on task and focus on what is critical. Hopefully you have kept notes on compensation issues that occurred in the prior year, such as salary range or hiring issues for certain jobs, maybe a department has restructured and jobs have changed that could require new job descriptions, exempt status review and may call for a complete department salary structure review. These are things you will need to attend to as you review your salary structure for 2014. Taking stock and making a list of the issues and problems from the prior year is a good place to start for your 2014 compensation calendar
Review and develop a timeline for your annual processes such as the merit increases, performance reviews, minimum wage increases, bonus payments, annual surveys you participate in, and wage or salary structure reviews. To do this, begin with last year’s timeline and a review of the process to ensure that you don’t miss any important steps or improvements or changes that are needed for this year’s process. Communicate the timeline and proposed changes to process partners such as Payroll or Accounting to ensure everyone agrees to the dates and has an opportunity to provide their input regarding the process.
Include data audits on your calendar or task list. Keeping your compensation house in order is important. Items to include are: ensure all jobs have the correct exempt status, ensure exempt jobs are paid at or above the exempt minimum wage, review wages by state to ensure all are at or above the minimum wage, include tip minimums. Ensure overtime is being calculated correctly for tip positions, for employees who work more than one job and when non-discretionary bonuses are paid. Perform some quick equity analysis, look for salary outliers and ensure you can defend if audited. You may find simple mis-codings or more serious problems. Look for new hires with hire salaries above or below the starting rate or any other exceptions that may need to be addressed. You may find positions that during the past year have consistently been hired at the higher end of the salary range. This is a strong indication that a salary range adjustment will be needed and this can be added to your list of salary structure issues that will need reviewed. If you were audited during the prior year and any issues were found, include those in your internal audit. Also it’s a good idea to have a procedure in place in the event of an audit during the coming year.
Review your compensation policies to ensure they are up to date with current regulations and with any changes that may have been made to your salary structure, procedures or systems. Ensure that you have not missed any new regulations that may require updates and changes to your existing policies or procedures.
Set aside time on your compensation calendar to review salary survey data when it is published later this year and perform a thorough analysis of your salary structure to market. A thorough review should be done at least every other year and each year you should minimally be looking at any problem areas or issues that occurred during the prior year and address possible salary structure movements and/or equity issues.
As the economy continues to improve, we expect to see more pressure put on salary budgets and merit increases in order to meet rising demand for talent. Our consultants can work with you to get the balance right on budgeted wage increases and their relationship with structure adjustments. When wage increases and adjustments are made, often other potential concerns are uncovered such as wage compression and paying out of range. WageWatch consultants are here to offer comprehensive guidance on your structure maintenance and adjustment requirements. WageWatch salary surveys provide data tools and report statistics for analysts of all experience levels. Please contact WageWatch if you need assistance with interpretation the statistics reported, help building custom reports, or have a need for our wide range of consulting services. For more information on our services and surveys please call WageWatch at 888-330-9243 or contact us online.