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In the first two parts of this three-part webinar series, we learned the ins and outs of budgeting around compensation. In this webinar, Mykkah Herner, M.A., CCP will dive into the PayScale Insight tool to show you how to leverage some of the built-in reports and analytic overviews to help with your budget calculations.
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Compensation Budgeting Part III: Putting it all together with
PayScale Insight
Mykkah Herner, MA, CCPManager of Professional Services
Karaka LeslieProduct MarketingPayScale, Inc.
www.payscale.com
www.payscale.com
Three-part Series on Compensation Budgeting
Part I: Managing Pay Inequities
Part II: Determining Raises
Part III: Putting it all together with PayScale Insight
www.payscale.com
14,000 Positions 3000 Customers 11 Countries
250 Compensable Factors40 Million Salary Profiles
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Agenda
Recap of Parts I & II
Part IIIIdentifying Pay Inequities – Org LevelIdentifying Pay Inequities – Position LevelIdentifying Pay Inequities – Employee LevelCalculating Pay Increases
By MarketBy Performance & Market
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o Start with a plano Know your comp Philosophy, Strategy, and
Policy
o Get reliable market Data
o Identify comp inequities at Org, Dept, Position, and Individual levelso Org/Plan level: fair pay to market
o Dept level: fair pay across departments
o Position level: have some positions move faster than others?
o Employee level: are you paying according to your policy? Fairly based on EEO status?
o Develop solutions
Recap of Part I
http://resources.payscale.com/hr-thanks-webinar-recording-Compensation-Budgeting.html
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o Know what you want to rewardo Streamline the increase processo Calculate pay increases
o Market-based
o Merit-based
o Develop budget recommendationso Range Adjustments (Org level)
o Market Adjustments (Position level)
o Equity Adjustments (Individual level)
o Pay Increase Adjustments
Recap of Part II
http://resources.payscale.com/hr-thanks-webinar-recording-Compensation-Budgeting.html
Organizational Level Pay Inequities
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Identifying Org Level Inequities
Ranges to Marketo Examine Ranges to Market on the whole – do most move up? Most move
down? What’s the average?
o Do you want to move ranges at this time?
o Budget
o Organizational demands
Position-Level Pay Inequities
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Identifying Position Level Inequities
Ranges to market by position
o Does the market suggest moving the position to a new grade?o What are the EE compa-ratios for those positions?o Decide which to move – examine where other positions are in the job
familyo How to identify what type of market premium could be applied to a
position (vs moving the grade)
Employee-Level Pay Inequities
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Identifying Employee Level Inequities
o Paying according to policy:
• green-circled, red-circled
• compression
o EEO Concerns
• resolve critical issues asap
Calculating Pay Increases
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Using a Matrix (Merit or Proficiency)
Tier increases by position in range & performanceo Start with a budget increase %o Allocate increases to EEs based on range penetration
and performance
o Create spreadsheeto Note: Proficiency, or another factor, can work like
performance in this example
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Increase Spreadsheet
Name Job TitleCurrent Annual Base
Range Min
Range Mid
Range Max
Compa-Ratio
Range Penetration
Increase %
Annualized Increase
New Annual Base
New Compa-ratio
New Range Penetration
Alexander, Maria Account Manager $45,900 $46,300 $57,100 $67,900 0.804 -2% 3.80% $1,744 $47,644 0.83 6%
Arnold, Alexandra Driver I $29,600 $29,300 $35,700 $42,100 0.829 2% 3.80% $1,125 $30,725 0.86 11%
Baker, Nicholas Account Executive $46,500 $40,400 $49,800 $59,200 0.934 32% 3.80% $1,767 $48,267 0.97 42%
Allen, Ryan Program Manager $86,700 $73,600 $93,300 $113,000 0.929 33% 3.80% $3,295 $89,995 0.96 42%
Bailey, Sara Senior Account Executive $64,000 $54,700 $68,400 $82,100 0.936 34% 2.80% $1,792 $65,792 0.96 40%
Anderson, James Customer Service Rep $45,500 $34,900 $42,500 $50,100 1.071 70% 1.90% $865 $46,365 1.09 75%
Andrews, Vincent Senior Account Executive $76,700 $54,700 $68,400 $82,100 1.121 80% 1.90% $1,457 $78,157 1.14 86%
Adams, Christina Account Manager $63,800 $46,300 $57,100 $67,900 1.117 81% 1.90% $1,212 $65,012 1.14 87%
Total/Average $458,700 0.967625 41% 2.96% $13,257 $471,957 1.00 49%
SUM AVG AVG AVG SUM SUM AVG AVG
• Compa-Ratio = Current Annual Base / Range Mid• Range Penetration = (Current Annual Base – Range Min) / (Range Max – Range Min)• Annualized Increase = Increase % * Current Annual Base• New Annual Base = Annualized Increase + Current Annual Base• New Compa-Ratio = New Annual Base / Range Mid• New Range Penetration = (New Annual Base – Range Min) / (Range Max – Range Min)
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Visit our blog: www.payscale.com/compensation-todayJoin our Group on LinkedIn: Compensation Today: HR Best Practices
Mykkah Herner, MA, CCPManager of Professional Services
Karaka LeslieProduct MarketingPayScale, Inc.
www.payscale.com
