A Total Compensation Review is a review process where an organization looks at the total cost of employee compensation and determines whether it is in line with their overall strategy.
If you are an HR professional, this is an essential process that you should undertake at least once every year. A compensation review is necessary because it helps you identify the company’s competitive position and keep up with the market trends. It also allows your company to attract and retain high-quality employees.
When it comes to employee compensation, companies often face challenges due to the complexity of the process. This is why they should consider conducting a total compensation review in easy steps.
The purpose of this review is to identify and address any gaps between current pay and what employees are actually worth. It can also help companies understand how their pay compares with other organizations in the same market and industry.
A total compensation review can be conducted by following these simple steps:
1) Define your company’s overall compensation philosophy
2) Identify all employees who will be included in the review
3) Establish a set of metrics for measuring performance
4) Determine how much each employee is worth based on their performance metrics
5) Create a budget for each position that includes target pay ranges, bonuses, and other benefits 6) Develop a plan for communicating with employees about changes
7) Implement changes
Conclusion:
A Total Compensation Review should be conducted by all employers, regardless of size or industry. It is important that you take measures that will benefit your business and employees, such as implementing a salary cap or offering more bonuses.
