Implementing A New Salary Program (A True Story)

This is a story that we recently included in our monthly publication of the latest salary, benefit, and wage information. Have you read the latest issue of FreshView?

About four years ago I revamped the salary structure of the small manufacturing plant where I worked. Located in a rural area, the employees commuted each day from surrounding towns, and many tried to carpool to save money. Money was tight for them, and I had previously worked my way through updating the various benefit programs to improve and offer the employees what they valued and could actually use. However, the salary program loomed ahead of me like a black cloud.

There aren’t many more volatile subjects than changing or adjusting someone’s pay. It is personal, and affects the most basic necessities that are available for the employees and their families. I felt that choosing a salary structure was a little like choosing what model of car they would own.

I started by participating in a salary survey (this one here) and as a member of Cascade, in exchange for my information, I received the survey results for free. This helped me compile “market” data for each recently updated job description. Then I got stuck trying to design a salary range. I eventually enlisted the help of the compensation department that conducted the survey.

A few months later we had negotiated and designed a sustainable, fair structure which provided incentives for learning. Each employee would receive compensation based on their job description – any arbitrary decision-making was a thing of the past.

While the executive team breathed a sigh of relief, I began to panic. How was I going to tell the employees that the structure had changed without them feeling like it was all a corporate “smooth over”? I knew the change was honest, and I had good rapport with the employees, but their wages were a sacred thing. As I thought through the issues I got a little more personal by admitting MY wages were a sacred thing. I decided to give them the information I would want personally, and I would deliver it consistently through as many different avenues as necessary.

Two communication methods proved to be the most effective. Several weekly company-wide meetings were held where I explained how the structure worked, and how it tied back to the individual job descriptions. Increases and raises were openly talked about, and questions were encouraged (and answered!).

After the meetings I breathed a sigh of relief, only to be hit with a barrage of questions in person, one-on-one. This was the most effective method of communicating, as I would take the employee back to their supervisor’s area, invite other employees to listen in, and I would explain it again with time for any questions or comments that needed to be voiced. This process took much more time than the actual designing of the structure. The consistency in the message was key. Employees were able to ask questions about terms and words I was using. I wanted to educate them as I learned, too. The questions they asked became the foundation for the changes I made in the New Hire Orientation program to explain to incoming employees how the wage decisions were made.

The only thing left to do was to be consistent long-term. The wages were reviewed the next year on time, exactly on the schedule we had promised. The employees remembered, and took note. While they didn’t always agree with every decision made, they knew they could ask and learn. Looking back I wouldn’t change the way I implemented a new salary structure. I would have planned on making even more of my time available for the employees to understand and ask questions. Employees are, after all, the most valuable asset a company has.

Michelle

Cascade Members - SalaryTrends keeps growing, and most companies are participating in the Salary Surveys right now in order to receive the latest market pay data. Is it time for you to update your information? Contact us if you have questions or need assistance.