Denise Liebetrau, MBA, CDI.D, CCP, GRP’s Post

Proactive Job Design: Ensuring Logical Career Paths A fundamental human need is learning and growth. If your employer can't show you what jobs would be a natural next step in your career, it means they haven't invested in developing career paths. Career paths are not difficult to define. Step 1 - Group jobs by their functional focus. Example: Accounting, Finance, Legal, Sales, Operations, HR, IT, Marketing, Communications, Government Relations, etc. Step 2 - Define career levels. Many employers have an individual contributor career path and a management or supervisory career path. Step 3 - Proactively design jobs to ensure that there is a logical path for employees and their managers to use as they develop their skills and capabilities. Of course, make sure these jobs and the work responsibilities being performed are needed by the company. Step 4: Market price the jobs based on the job descriptions. Assign the pay grades and salary ranges as well as the short and long-term incentive targets. Step 5: Communicate to your managers and employees what is now available for use to recognize growth and learning aligned to business needs and employee capabilities. That's it. My team and I do these Job Architecture/Career Path projects all the time. If you have this as an initiative this year, let's talk. https://lnkd.in/gnYXDy_i #careerdevelopment #careerpaths #humanresources #compensation #hr #careeropportunities #jobarchitecture #compensation #careerladders #learning #growth

Uncomfortable Conversations: Key to Fair Pay Employers typically benchmark their jobs to determine if they are competitively paying their employees every year or every other year. Most of the time my team and I find that 70% or more of the employees are paid within the market-based salary range.  But I really get to understand the leadership capabilities of HR and the executive team when it comes to their reaction to seeing the employees who are under or over paid. Sometimes, there is an immediate agreement to provide increases for those who are underpaid.  There is often concern expressed about how this happened and how they can prevent it from happening in the future. And if the company is struggling to have the budget to provide immediate pay increases, a plan is developed to include it in the budget as soon as possible. When the list of employees who are overpaid is shown, there are different reactions: 1)        “Are you sure you chose the right match from the external market?” (Yes, we double checked and are comfortable with the match. Would you like to review it?) 2)        “Are you recommending we reduce their salary?” (No.) 3)        “This is going to be a difficult conversation. What do you suggest we say to these employees?” (See my post on 28 June 2024.) And often, I find that the uncomfortable conversation doesn’t happen with the overpaid employees. Instead, HR/Compensation advises senior leaders on how best to have the conversation but during the next merit planning cycle, the employees continue to receive the same standard 3% – 4 % base pay increase. None of us like to have uncomfortable conversations, but they are the foundation of success in life and at work. You aren’t a great manager or leader until you can have uncomfortable conversations that lead to change. If you prioritize compeititve, equitable, and fair pay, at some point uncomfortable conversations will need to happen. https://lnkd.in/g38Z7KN4 #compensation #hr #humanresources #rewards #leadership #marketpricing #payequity #paytransparency #fairpay

Make Compensation Decisions with Clear Guiding Principles In a recent meeting with a client’s executive leadership team, I facilitated a discussion about Compensation Guiding Principles. A principle is a kind of rule, belief, or idea that guides you. They are basic truths that help you with your life and decisions. And in the case of compensation decisions, there is often tension and a balancing of priorities that needs to happen to arrive at an outcome you can communicate with transparency and that builds trust. It’s a good idea as an employer to write your own guiding principles so you have a compass to reference if you find yourself debating what action to take and how best to communicate the decision and why behind it. Compensation Guiding Principles: 1.     Alignment to Business Strategy & Goals: Influences compensation philosophy  2.     Affordable: Impacts budget for annual increases and market/equity adjustments  3.     Competitive: Percentile of the external market targeted – typically 50th  4.     Equitable & Fair: Consistent use of standard pay decision making processes  5.     Transparent: How openly you communicate to employees  6.     Determining the value of the JOB is based on the external market and what is competitive given the pay practices of other employers balanced with internal equity.  7.     Determining where to pay the EMPLOYEE in the range assigned to the job is typically based on factors like performance, tenure, work location, education, and/or experience. Is there something on your list of principles that you would add to this list? https://lnkd.in/ggPTsf5W #compensation #rewards #hr #humanresources #payequity #paytransparency #fairpay

Transforming HR/Compensation: From Rules-Based to Business Partner Shifting your HR/Compensation team from rules-based policing to a business partner (internal consulting) is a daunting task.  Here is my advice to CHROs and CEOs who need to make this happen to better align their people impacting decisions to business realities. Become a Business Partner: The 5 Guiding Principles: 1.        Business Acumen and Context – Know how your business drives revenue and manages expenses. It’s all about money and profitability. How do employees and financial capital get deployed to achieve these goals? 2.        Guidelines Not Rules – Know your guidelines, but know what you are able to make an exception for and why. Not all rule breaking is against the law. Don’t act like it is. There are a lot of gray areas to navigate. If you don’t know how to do it effectively, ask for advice from more experienced colleagues. 3.        Listen to Understand (not to respond) and Ask A Lot of Questions – You don’t know everything you need to know in a situation. Listen, ask questions, and ask more questions. What is motivating the actions of your leaders and employees? What needs are they trying to meet? Why is it important to them? What aren’t they telling you? Use your emotional intelligence skills. 4.        Facts not Fiction or Friction – Make observations without judgements, assumptions, evaluations, interpretations, or speculating about motives. Focus on the facts. What is true? Restate what you heard to ensure you understand, and they feel heard and understood. Be the person in the room that shares the facts. Do not allow fiction and friction (conflict) to cause you to dilute your advice. Speaking truth to power takes courage and integrity. Practice makes this easier. So does having a financial cushion so your need for a paycheck doesn’t create the need for you to act in a way that isn’t aligned to your personal values. 5.        Communicate with empathy, compassion, and assertiveness. Whether you are talking to the C-suite leaders or front-line employees, recognize the human beings in front of you and what they are trying to achieve. Don’t be a jerk. There will be tension and conflicting needs. That doesn’t mean you can’t communicate respectfully. Dictating without telling people why you made the decision you made isn’t going to lead to success. You don’t need everyone to agree. But you do need everyone to understand, feel heard, seen, and appreciated. If you don’t prioritize that, employees will go where this is prioritized. And if you don’t have self-awareness and emotional regulation skills, you need to invest in yourself. If you’ve made this shift to being a business partner (HR or Compensation) in your organization, what would you add to this list? https://lnkd.in/gv7Jey8d #businesspartner #hr #humanresources #compensation #rewards #communication #listen

When to Enforce Salary Range Maximums I was talking with an employer client recently about the pay grades and base salary ranges my team developed for their organization. There were a few employees paid above the maximum of the salary range. We were discussing what to do about that and here is a list of my recommendations: 1)        Don’t continue to give them base pay increases until the ranges allow for base pay growth in the future. This assumes you will update the pay grades and ranges annually. 2)        Consider providing a lump sum payment in lieu of a base pay increase during your merit planning process. 3)        Have a one-on-one conversation with the employees paid above the salary range maximum. Be transparent about their situation. It sounds like this: a.        “John, We recently had an external consultant help us compare what we are paying our employees to what other employers are paying for similar jobs. b.       The base pay range associated with your Accountant job is $X - $Y.  Your base salary right now is $Z which is above the maximum of the range. c.        What this means is that you are paid very well for the job you are performing. d.       I also recognize that this may be disappointing, because I am assuming you want to continue to see your base salary increase over time. Is that assumption true? (John says yes.) e.        One way your base salary can increase is through a promotion. So, I encourage you to look at our job postings to see if there is anything you would like to apply for. f.          Another way is to have your job responsibilities change substantially enough to have your job re-evaluated by HR and assigned a higher pay grade.  g.        With no change to your job responsibilities, you will be eligible for a lump sum payment in lieu of a base pay increase during the merit planning process next year. h.        Do you have any questions?” The employer asked if they could treat the maximum of the base salary range as a suggestion and not as a “hard stop.” My response: “Yes, of course. As an employer you get to choose how to spend your limited budget on your employees and their pay.  However, consider this. You have more than 10% of your employees underpaid. And it would take $X to get their base pay to the minimum of the base salary range. What is a better use of your budget? Paying more to underpaid employees OR continuing to pay more to very well-paid employees? At some point, you have to say “no” or why have base salary ranges at all? And finally, consider pay equity. Continuing to over pay isn’t helping you reach that goal.” ·        Employers: Are your base salary range maximums a hard stop or are they a suggestion? And if they are a suggestion, at what point do you say no more? https://lnkd.in/gEgY93Za #compensation #rewards #hr #humanresources #paygrades #pay #payequity #paytransparency #fairpay

Emerging Niches in Compensation Careers Most people who do compensation work end up there by accident. I don’t know any 5-year-old that says they want to be a Compensation Analyst when they grow up. Compensation is a profession that requires many skills and competencies. Things like data analysis, Excel skills, storytelling, effective communication, influence (sales) skills, critical thinking, problem solving, business acumen, and empathy are on the list of competencies I look for when adding people to my team. Most people start off doing broad-based compensation work. Then there are the specialties within the profession that they sometimes go toward as their career progresses. ·        Executive Compensation ·        Sales Compensation ·        Global Compensation I’m starting to see a new niche in our profession.  It is focused on pay transparency (aka communications) as well as pay equity.  It often goes even broader into workplace equity (think pay and opportunity equity) and has ties to talent management and development. The compensation profession is becoming more complicated. Those who sit at a desk and do data analysis all day will need to step out of their comfort zone. We need to know the story the data tells us, but we also need to be able to communicate that story in simple terms and tie it to what the business leaders care about. And those compensation professionals who will really stand out and excel will focus on more than rewards like cash or equity compensation. Instead, they will lead with a focus on the following: ·        Rewards + Recognition + Relationships = Results “I've learned that people will forget what you said, people will forget what you did, but people will never forget how you made them feel.” –Maya Angelou https://lnkd.in/gUrs2Y2F #rewards #compensation #payequity #paytransparency #fairpay #hr #humanresources #incentives #equity #executives #leadership #recognition #relationships #pay #salary

Are You Using Compensation Band-Aids? It usually starts when you are under resourced. You don’t have enough time to do all the work that is expected of you, so you do something quick to answer a question. And then you never go back and do the full analysis and implement final decisions made with intention and integrity. ·        Instead of assigning the grade to the job, you market price it and then calculate a base pay range around the 50th percentile. Then you share that specific range with the hiring manager or on the job posting. ·        Instead of updating the pay grade structure for the next year by doing the external market analysis, you just age it by 3%. ·        You don’t have geographic differentials defined and based on market data. You have increased the range spread on your base salary ranges to accommodate what you hear from Talent Acquisition and hiring managers. ·        You don’t update the market pricing on all the jobs each year. You only do it one job at a time as you hire to backfill a role. ·        The target short-term incentive for each employee depends on what the hiring manager asked for. There is no consistency by job, pay grade, or career level. ·        You are constantly explaining why you’ve made exceptions to the normal job titling standards. ·        The pay of certain employees has been “grandfathered” and internal equity is not prioritized. ·        The number of direct reports varies from zero to more than 10 for those with supervisory titles. You don’t have a standard that is agreed to for the minimum number of direct reports to consider a job a supervisor. ·        Instead of doing a thorough pay equity analysis with comparator groups, you do it only on job title. You calculate the average and median for each job title and only look at base pay.  You define outliers as those that are 15% or more. Nothing less than that percentage is researched. ·        Each country has its own pay grade structure and approach. There is no consistency globally or governance in place.  I could go on and on. These are examples of compensation Band-Aids. The analysis of your pay and people data is difficult. There is no integrity and standardization of the decision-making processes.  Cleaning this up seems like a huge task given the people on your team and competing priorities. You’re tired, overworked, and burned out. You’re thinking of quiet quitting just to survive. But you talk yourself out of it because you care. You care a lot about doing the right thing. You wish you had an expert who could help you do the data analysis and develop the recommendations. And then turn that into a presentation you can use with senior leaders that convinces them to approve the necessary changes. Let’s talk if this is your situation. https://lnkd.in/gT729tfY #compensation #rewards #hr #humanresources #payequity #paytransparency #fairpay #incentives

Is the CHRO job too big and complex? In the last 24 hours, I’ve listened to two podcasts on this topic: a)       The Modern People Leader, hosted by Stephen Huerta, Episode 186 with Hebba Youssef b)      Josh Bersin, The Ever-Expanding Role of the CHRO To summarize, they point out that the CHRO role has grown in responsibilities and impact over the last few years. Not only do these leaders need to understand the multiple disciplines within HR but they also must know about: ·       The labor market and the economic conditions that impact their employer’s industry and company ·       Legal and compliance issues that seem to grow every more complex, especially globally ·       The mental health and well-being of employees and how best to impact it ·       What motivates employees, their productivity, and performance ·       The company’s finances and how revenue growth will be achieved through the deployment of financial and human capital ·       Planning for layoffs, reskilling and resiliency, as well as future workforce planning ·       How best to set expectations, manage expectations, and communicate with transparency and empathy ·       Build leadership capability within first level supervisors through senior management ·       How to be the CEO’s therapist and executive coach ·       Managing ALL the technology that supports the delivery of an excellent employee experience. Simplifying what isn’t simple is grueling work. ·       The people data, ensuring it is accurate, and using it to tell a compelling story ·       How to align human capital initiatives to the needed business results You get the point. The Head of HR isn’t overseeing just payroll and compliance anymore. It is an interdisciplinary role that requires significant expertise and a nuanced understanding of the employer’s business and the behavior of people. AND the behavior of people changes with each new hire and departure of a team member. CEOs and Board Members: ·       It is time we think about the breadth and depth of the CHRO role. How does it differ from one company to another? What is essential versus nice to have? ·       Do we need to allocate some of these areas of responsibility to separate roles to ensure that have designed a job that is doable? How much is too much? ·       How do we develop leaders to fill these jobs with the necessary skills and capabilities for today’s workplace and tomorrows? ·       And perhaps most importantly, why don’t we have more human capital leaders in the boardroom? https://lnkd.in/g5UgBSgY #chro #CPO #hr #humanresources #leadership #jobdesign #orgdesign #organizationaldesign #headofhr #boardofdirectors #boardmembers

The Future of Compensation Data: Going Beyond Salary Surveys When I started doing compensation work in the 1990s, the only compensation data we used to market price jobs was the traditional salary surveys. Traditional salary surveys are still published by a variety of firms ,but now there are more pay data sources employers can use. 1.        Crowd sourced and/or self-reported pay data 2.        Job offer pay data (from your ATS, for example) 3.        Web scraped or job posting pay data The challenges with these nontraditional compensation data sources include: ·        Timing – When is the data captured/provided? When is it published? How often is it updated? ·        Does it provide all the pay elements like base pay, short-term incentives, and long-term incentives? ·        Is the method of collecting the data consistent and standardized year over year? ·        Do I trust how the data is reviewed and how outliers are handled? ·        The job posting data isn’t easy to interpret. Is it the full base pay range?Is it just part of the range for the job posted? There are general statements about incentives but often not a specific number or range provided by employers when they post a job opening. ·        Is the employer’s job a good match to this job in the survey results? Is there a good job description provided by the survey publisher that I can compare the employer job to? Often these new data sources are used to validate what is published in traditional salary surveys. And no compensation data source is perfect.  The real challenge is knitting all these sources together into a cohesive and easy to understand story.  And then using that summary (story) to determine what to recommend to the employer that balances: ·        External competitiveness ·        Internal equity and fairness ·        Budget impact ·        Transparency ·        Alignment to business strategy and goals Compensation work has become more complex over the years, and it will continue to become more challenging. What other nontraditional pay data sources are you using? What will be using in the future to benchmark jobs, skills, competencies, employees, etc.? https://lnkd.in/gZEXP_xb #compensation #rewards #hr #humanresources #pay #payequity #paytransparency #fairpay #salarysurveys #compensationdata #paydata #totalcompensation #basepay #salary #incentives #commissions #LTI

The Paper Ceiling, Talent Acquisition, & Compensation What’s the paper ceiling? The paper ceiling references the career advancement barriers people without a college degree experience. 62% of the workforce in the U.S. potentially has paper ceiling barriers given that about 38% of the population (age 25 and older) have a bachelor’s degree.  I hear from employers all the time that they struggle to find qualified candidates to fill open jobs. I also read a lot of job descriptions that include a bachelor’s degree requirement. First, rewrite your job descriptions. Next seriously consider and interview candidates that do not have a degree. ·        “A bachelor’s degree or equivalent experience required.” That is a simple statement, and it can profoundly impact an employer’s ability to recruit the talent needed to achieve their business goals. STAR stands for Skilled Through Alternative Routes and includes those who acquired skills via their military service, on the job training, as well as certificate and boot camp programs. There are as many as 70 million STARS being held back by the bachelor’s degree requirements for certain jobs. And 30 million of these STARS could earn up to 70% more in salary if they had access to these jobs. Employers need to rethink their requirements versus preferences. And their recruitment and hiring related actions need to be changed to include those who are qualified but not perfect. Candidates need to apply even if they don’t meet all the job “requirements.” Diversity, equity, inclusion, and belonging are just words until there are consistent actions that are in alignment with these stated goals. https://lnkd.in/gNMUA_jf Sources: Fair360, U.S. Census Bureau, Opportunity@Work #paperceiling #talent #recruiting #jobsearch #DEI #DEIB #pay #compensation #rewards #hr #humanresources