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The Boomer Generation in the Workplace

It is not uncommon for baby boomers to now work side by side with co-workers from generation X and generation Y. Each of the generations in the work place today grew up in different times with widely varying political and social issues, technologies and other factors, which have affected their attitudes on everyday life. As an employer, it’s important that you understand each of the generations you employee in order to provide them with the work environment and rewards that make them most happy.

The basic employment packages for businesses are based on the needs of baby boomers, a very loyal generation of workers, typically staying with the same company for years and years. Employees of this generation highly value their benefits, such as health insurance, life insurance and vacation time. To determine if their company is providing salaries and benefits that are on target with the industry average salary, many employers turn to market compensation and benefit survey data. These baby boomer employees that have stayed with a company for most of their careers have invaluable knowledge and experience that is essential to business operations, so it’s important that employers keep them happy and reward them for their loyalty.

While it is important to keep baby boomers satisfied by analyzing market compensation data, benefit survey data and salary reports, it is also essential for employers to look at the needs of the upcoming generations. Many baby boomers are in management positions, but will start to retire around the same time leaving a large number of open positions. It is essential that skilled employees of the X and Y generations be there to take their place.

The new generations of workers enjoy benefits like the baby boomers, but these employees prefer additional incentives and small tokens of appreciation for their efforts. This generation is not as loyal to the companies they work for, and have no problem moving to a job at another company every two or three years. For this reason, it is even more important to build loyalty with employees of these generations by providing them with the benefits and incentives they desire. It is very beneficial for companies to be using benefit survey data, market compensation data and salary reports to determine the types of compensation, including incentives, that are standard for the industry. Having this data will help companies to stay competitive with other employers by creating appealing benefits packages that will attract and retain top talent.

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 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 market compensation data, benefit survey data and salary reports, please call WageWatch at 888-330-9243 or contact us online.

Posted in Recruiting & Retention on April 24th, 2013 · Comments Off on The Boomer Generation in the Workplace

The Pros and Cons of Merit Pay

Merit pay is a compensation strategy that is used to motivate employees with pay increases for positive performance outcomes. This system is one that is heavily debated among businesses throughout a wide variety of industries. Every business has its own unique structure and culture, and must decide what payment system works best for them based on a set budget developed from salary reports. If you are thinking about establishing a merit pay system for your company, it is important to understand both the pros and the cons:

Pros

– Statistically, merit pay is one of the most effective methods for motivating employees to perform at their peak, which allows them to achieve high levels of productivity.

– This pay system promotes healthy competition among employees, encouraging each to work hard to achieve their very best while also delivering great results for the company. Employees enjoy being recognized among their co-workers and upper management for a job well done.

– The brightest and most skilled employees can easily become unmotivated. With a merit pay system, however, motivation is achieved. High performers are well aware of their skills and enjoy using them in challenges to achieve goals that are linked to monetary incentives. Merit pay gives these employees the recognition and reward they deserve and also helps companies to retain their best employees.

Cons

– Merit pay systems can cause conflict among employees. Some may feel that the system is unfair because no matter how hard they work, they may not be able to earn any incentives. This leads employees to feel unmotivated and unimportant. This is primarily due to inadequate performance appraisal systems leading to inconsistencies among raters.  And the performance appraisal ratings are the basis for the merit pay.

– Merit pay systems can garner healthy competition, but they also may lead to the disintegration of team unity. If everyone is in it for themselves, problems could arise. Personal goals may become more important than team goals, which is not beneficial for the company as a whole. Top performers may also be seen as more valuable and important than others, leading to feelings of jealousy.

– It can be challenging in the current economy to adequately distribute merit pools of 2% or 3% and still award your top performers adequately

For the most part, merit pay is a method that is generally accepted and tends to work for most businesses. It is important, however, that you still weigh the pros and cons before carefully choosing a payment system that works the best for your business and its unique culture. All incentives should be those that will be meaningful to employees. As such, businesses must provide incentives that are competitive with compensation being provided to top performers at other companies. Salary reports can provide you with this data.

At WageWatch, our professionals 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.

 

Compensation Committees

Compensation committees are an appointed group of individuals that have corporate governance over compensation and benefit programs for executives and company officers. The committee is typically chaired by the CEO and composed of both inside management directors and outside independent directors. Their work includes determining the types of pay plans, the amount of compensation and the performance measures that the executives will be upheld to in regards to the calculation of incentives.

Compensation committees play a strategic role within the business by aligning company performance and executive rewards. Individuals within the committee must create a compressive program, with the aid of compensation surveys and consultants, which motivates executives to achieve the overall goals and objectives of the company within their own positions. High performance is best achieved through the implementation of a strategic merit pay program, short and long term incentive plans including stock awards, retirement, and executive perquisites.

In addition to strategy, compensation committees also play an administrative role. They are responsible for completing studies, evaluating alternative compensation plans and outlining the compensation package. Compensation Committees often times have oversight over complex human resources issues such as equal opportunity and pay, executive succession planning, and director evaluation issues. How much oversight Compensation Committee has depends on many factors including composition of the committee, management engagement, corporate culture, and regulatory environment.

Over the years, executive compensation has become a rather large issue in the media. There are numerous media watchdogs that have the ability to relay information to the public more quickly than ever before. In addition to increased media attention, executive compensation has also seen tighter government regulation. Committees must accurately address the expectations of board members and investors. To keep investors happy, the executives must stay motivated to achieve the established business goals and objectives. Therefore, committees have an extremely important role in designing merit pay programs.

An effective executive compensation program will include performance evaluation that is both measurable and well communicated. The rewards for delivering results need to be meaningful to executives and competitive with what other businesses in the marketplace are offering. At WageWatch, our Executive Compensation Survey and Compensation Consultants can you’re your Compensation Committee to establish a budget for salary changes, benefits and merit pay, including any bonuses or incentives. We have the experience and capability to collect data for compensation surveys, salary reports and other studies in a wide variety of industries. To learn more about how our compensation surveys can help you to develop effective and competitive compensation strategy, please call WageWatch at 888-330-9246 or contact us online.