In today’s competitive market with low labour supply, it is vital for organisations to have a compensation & benefits system that is prudent yet competitive to attract, motivate and retain talents.
An effective compensation & benefits structure should ensure both internal equity and external competitiveness. Without an internally equitable structure, employees may perceive unfair treatment within the organisation, especially if new hires are drawing higher salary than existing employees or better performers drawing lower salaries than long serving employees.
In addition, organisations may also be unaware of their relative standing in the market if there is a lack of competitive compensation structure. As a result, it may be unclear as to whether employees were being paid at competitive levels.
How can your organisation benefit from having an effective compensation & benefits system?
In short, your organisation will be able to:
- attract potential candidates
- retain high performers for key positions
- manage employees’ salary & benefits in a prudent yet effective manner
- create the notion of pay equity and fairness among all employees
- build a reputation as an employer-of-choice
How can EON help you achieve the results?
At EON, we will walk you through on how to develop a well-aligned job grade structure that can establish an internally equitable salary structure. A well-aligned salary structure will reward employees fairly based on job characteristics and individual performance. This can create a sense of procedural justice and reduce grievances.
Through this framework, your organisation will also gain insight of its relative competitive compensation levels through external benchmarking. You will be equipped with skills and strategies to update salary levels in response to economic changes and sustainable methods as well.
The process of developing an effective compensation & benefits system will include:
- Audit current compensation & benefits structure
- Develop job grade structure and salary scales
- Conduct internal equity analysis
- Review salary and benefits against market data
- Review / design a performance-based bonus payout methodology
- Introduce guidelines to manage salary levels
- Review / write a compensation and benefits policy