In episode 64 of “The JoyPowered® Workspace Podcast,” JoDee and Susan discuss the fundamentals of compensation management with fellow SHRM instructor and Gotham Comedy Foundation Lifetime Ambassador of Laughter award winner Jennifer Loftus. Topics include the total rewards equation, building out a compensation package, and how to benchmark your organization’s compensation philosophy with competitors.
JoDee shares that, when she was first transitioning from accounting to HR, she first explored the option to be certified in compensation management, but ended up dropping it. Susan also spent some time in the compensation world, spending some time early in her career as a compensation analyst.
After welcoming Jennifer to the podcast, she shares that, much like JoDee, she started out with a major in accounting. After falling out of love with the career while studying auditing, Jennifer decided that she needed to pivot to something else. After finishing her accounting degree as a backup plan, she went on to earn an MBA in HR.
Base pay isn’t the only thing that goes into compensation, and Jennifer goes on to explain how each company has a different philosophy towards total rewards, including benefits, bonuses, and more. This philosophy often differs even inside an organization, with different departments receiving different options for compensation. Jennifer goes on to break down the difference between internal and external equity. It’s important to understand that there is no one-size-fits-all approach to choosing between the two types of equity, and which is more important often largely depends on the goals of the company.
SHRM just announced new salary benchmarking tools for members to consult, and there are many other salary surveys that are available for purchase at differing price points. Participating in salary surveys can also yield a great return on investment, as many companies will offer discounts for participants. There’s also sites like salary.com and glassdoor.com, but Jennifer cautions against using only crowd sourced data for something like this if there are other options available.
Above all, Jennifer implores us to not rush the creation of a compensation package. It might take weeks or months, but it is a foundation for employee satisfaction and must be handled thoughtfully. To round out her time on the podcast, Jennifer wraps up with a laundry list of common mistakes she sees when organizations are reviewing or creating their compensation philosophy.
After Jennifer heads out, JoDee and Susan break down an article about 5 must have elements for compensation management from HRsoft.com. For the listener question, the ladies talk about realistic timetables for filling vacant jobs.
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