Compensation Plan Design Study for a Non-Profit Organization
Background
One of the most common reasons businesses hire Spectrum HR Solutions is to resolve employee challenges with pay practices and compensation plan design. Typically, compensation issues arise for one of three reasons:
- The business is no longer able to afford the salaries they’re paying to their employees.
- Employees have begun leaving the company for other, higher-paying jobs.
- The business has encountered issues with internal fairness, e.g., one person does more work but makes less money.
A non-profit organization enlisted our expertise to help them get a handle on their own compensation issues.
The Problem
The non-profit organization that hired us expressed a difficulty in determining what they should be paying their employees. Compounding this problem was a set of concerns related to internal fairness. We warned that internal fairness issues can become legally onerous, and that a thorough compensation study would be necessary to avoid this.
Our Approach
We conducted a compensation study in multiple parts, providing a data-driven framework for understanding employee value and salary.
- We began with an in-depth analysis of the non-profit’s goals, and how those goals were supported by day-to-day tasks and responsibilities. This provides insight into the value brought to the table by each role.
- We also conducted a job evaluation, providing us with a clearer sense of what employees were actually doing each day and how their work supported organizational needs.
- Using these two data points, we were then able to create salary grades. These provided the management team with a way to identify how much employees should be compensated; it effectively leveled the playing field for all employees of the non-profit.
The Results
Whenever we perform a compensation plan design study for an organization, we always build a system (in the form of a workbook) they can keep with them and use in all future hiring and compensation matters. That’s exactly what we did for our non-profit client. The workbook we left them provided formulas into which they could “plug in” certain data points to arrive at correct salary levels; in other words, we furnished them with a way to clearly and fairly assess employee value, based on their contributions to organizational needs.
Through the use of these workbooks and similar resources, we give our clients tools to maintain a level playing field even after our work with them is done. We are proud to offer long-lasting value to each of our clients.