Over the past two years, employers across the UK have experienced an unprecedented number of resignations. Higher pay is among the primary countermeasures that have contributed to this and with inflation and the cost of living at its highest in decades, it is not surprising.
In a 2022 survey, CIPD demonstrated that 20% of the British workforce will seek a new job in 2023, and 35% of them stated that a better salary is their primary motivation.
In 2023, companies must ensure that salaries are fair and equal but at the same time competitive and attractive for top talents.
In this guide, it’ll be examined the salary market and the best practice for salary evaluation, salary benchmarking, and salary levelling.
Research the market- Align
This is as simple as it sounds. Employees want to be paid according to their qualifications and not below the market rate salary.
Top talents know very well what they can aim for, and it will be hard, if not impossible, to negotiate with them if you don’t know the market average.
That’s why you must be prepared. But how do you discover the market rate?
There are various job boards and sites that can provide information such as Indeed, or LinkedIn’s salary tool.
Many prefer to choose to speak to a reliable and experienced recruitment specialist like Barber McLelland, which will provide precise market data, based on location, size of firm and experience level. Providing you with a definitive solution for salary benchmarking.
Establish regular pay reviews
Stagnation is the word you want to avoid at all costs. Transparency, on the other hand, is where you want to go.
How do you combine these two words to make the most out of them? You set up a clear and periodic salary review. Your employees will know immediately when they can expect a discussion about their performance, their impact on the company, and what salary they should expect for the next few months.
That would give your employees peace of mind about one of the most relevant aspects of their careers. It avoids salary stagnation, which has been one of the main causes of resignation in recent years.
Plus, a salary review allows you to give the appropriate salary to your employees and have an attractive appeal to top talent.
Salary scale to eliminate pay discrimination
How do you erase friction between employees and the pay gender gap?
The debate still needs to be solved as the topic is complicated and involves social and cultural elements in it. But, a precise salary scale based on each position the company hired can level the salary between genders, levels, and contributions to the company.
This system ensures a fair salary distribution and allows the company to reward its employees based on the skillset they bring in when hired.
A strong compensation strategy
This goes well with the salary scale. When your company has a clear and strong compensation strategy, transparency is guaranteed. That is beneficial both for employee retention and acquisition.
Employees with similar skillsets and experienced will be equally compensated, eliminating bias.
Your compensation system, once completed, must be aligned with your salary guidelines to guarantee transparency.
Conclusion
Due to issues surrounding hiring new talent, retention of employees is the key to stability and success. Having a salary system that is transparent and fair is vital.
To help avoid losing staff due to pay, it is best to consider a total system review and promote transparency and equality, especially regarding salary and compensation.
We appreciate that pay does only form some part of individual’s motivation when considering their career moves, career opportunities, development etc, all play a significant part, however, getting the pay right initially could help to prevent a staff member from looking for a new business.
For more information regarding salary benchmarking, please contact Justin Barber at Barber McLelland on 0114 2792843 or email justin@bmrecruitment.co.uk