Base Salary Compensation Management System

Client Needs – A Virginia-based client had grown to over 400 employees and needed a compensation framework to enable leadership to assess current pay in relation to the local market and to ensure ongoing competitiveness. The new structure would provide a basis for aligning pay internally, for compensation planning, and for assessing pay equity. While job offers were formerly reactive, the new structure would ensure that pay is aligned across the organization while offering the flexibility managers need. Equally critical, the structure would provide a basis for responding to employee queries about pay.

HR Advisors Group’s Solution – Our consultants met with the client’s leadership to discuss and understand the firm’s pay philosophy. The team facilitated multiple meetings with HR and leadership to create a compensation framework to reflect that philosophy, including job groups, job families, career levels, and job titles, as well as to ensure legal compliance.

Multiple industry salary surveys were referenced to conduct market pricing based on the job families and career levels. Employees were mapped provisionally to a job family and career level and then incumbent compa-ratios were calculated and analyzed to reveal how closely salaries aligned with market midpoints.

Our team documented the market price methodology to provide an introduction to the world of compensation to the client, including compensation terminology, definitions, and market pricing results. A Job Mapping Reference Guide was developed to include job family summaries, career levels, and typical minimum job qualifications for each job, as well as job competencies with descriptions across all job groups.

Our consultants collaborated with the client to enable HR and management to conduct successful mapping meetings and to finalize employee mapping. Market Pay Calculators with market salary ranges were created to help HR to manage compensation going forward. Final compa-ratios were calculated and a meeting facilitated with leadership to summarize milestones and results.

Key Activities and Learning Objectives for this Initiative included:

• Discuss the firm’s pay philosophy with leadership
• Conduct market pricing using multiple salary surveys
• Calculate and analyze incumbent comp-ratios
• Document the Market Pricing Methodology
• Create a Job Leveling Matrix with competencies needed to succeed at each career level
• Develop Job Family Summaries highlighting major duties and responsibilities typically assigned to the job family
• Collaborate with the client to enable Human Resources to conduct successful mapping meetings and finalize employee mapping.
• Create Market Pay Calculators with market salary ranges to enable HR to manage compensation going forward

Now that the client has market-based salary ranges and a process for updating the Base Salary Compensation Management System, the firm is better positioned to maintain a compensation system that is fair, understandable, and achieves a goal of pay transparency. This in turn promotes employee loyalty and retention and ensures that pay is not a reason for dissatisfaction. It also reduces the firm’s vulnerability in the event of an audit or other regulatory action.

This project has served as a baseline for future career path development. HR Advisors Group is working with the client to guide the development of career paths for the company.