The Top Three Reasons to Create Pay Grades

What Pay Grades Can Do For Your Organization

By Stacey Carroll, PayScale.com

We talk about pay grades all the time here at PayScale, but not everyone understands why they are so important. So, without further ado, here are our top three reasons to adopt pay grades.

3.      Easier to Administer Than Individual Ranges

While this is not the primary reason for developing pay ranges, it is important. In job-based ranges, each job has a different pay range.  In some cases, the difference in one range and another may be quite small, even insignificant. 

What's Happening in HR

Compensation Today's News Round-up

By Tripp Ritter, PayScale.com

Welcome to our news round for late May. As you catch up after the long weekend, we wanted to give you the HR and business news you may have missed.

Maternity Leave Poll Results Are Here!

The results of Compensation Today's first poll are in. A few weeks ago, in "Poll: What is Your Company's Maternity Leave Policy," we asked readers to tell about their company's maternity leave policies. A little over 250 of you let us know. The results can be found below. Most provide the statutory requirement of 12 weeks of unpaid leave, but a fifth are now providing paid leave.

PTSD: Challenging, But Manageable

It's Easier Than You Might Think

By Tripp Ritter, PayScale.com

A movement has started to inform employers that the dangers and frequency of post-traumatic stress disorder (PTSD) are often overstated. According to researcher Dr. Harry Croft, medical director at the San Antonio Psychiatric Research Center, whose views on hiring veterans were covered in an earlier post “The Right Reason to Hire Veterans,” "Not only are the rates and severity of PTSD  lower than many assume but, when understood, the impact of PTSD in the workplace can be managed."

In Comp Data, Fresh is Good, Stale is Bad

MarketMatch Goes Farther

By Tim Low, VP of Marketing, PayScale.com

Today, PayScale releases an update to our MarketMatch algorithm. We do these regularly to provide our customers access to the latest and greatest information on the market and the state of compensation at any given moment. We don't believe in 15 month old surveys 'aged' and massaged into categories and slices that might not be relevant to your business today. We believe in real data from the recent past, like the past few days. So, while we don't always talk about changes to MarketMatch in great detail, today I thought it would be good to share with you some of the things that are new and fresh.

It's More Than Just the Pay

Retention Requires Communication

By Tripp Ritter, PayScale.com

Some stories make you cringe. For those of us who think about human resources every day, this post by Paul Spiegelman may be one of them. In the article, he talks about losing one of his top performers and the lessons he learned from the experience. Like many employers before him, he relearns the painful truth that retention matters as much as recruitment.

Poll: What Is Your Company's Maternity Leave Policy?

Paid Leave Makes A Difference

By Tripp Ritter, PayScale.com

Do you want to make sure your pregnant employees remain loyal employees and stay at work long after they give birth? If so, you might be wise to focus on whether or not any leave you provide is paid, according to a new research study. Researchers from Bryn Mawr College and Rutgers University found that women who take paid maternity leave are more likely to still be working a year after they give birth than those who take no leave at all.

The Right Reason to Hire Veterans

Do Them and Your Business A Favor

By Tripp Ritter, PayScale.com

A former Army psychiatrist thinks companies often hire veterans for the wrong reasons, leading to bad results for both the businesses and the veterans. Dr. Harry Croft, co-author of Always Sit With My Back to The Wall and a former Army psychiatrist who has been working with veterans since 1973, argues that the best reason to hire veterans is for their skills.

What’s the Difference Between Performance & Proficiency?

Just Rewards For Your Employees

By Mykkah Herner, MA, CCP, Compensation Consultant at PayScale.com

Here at PayScale, we often talk about compensation philosophies answering 3 main questions:

• How do you define your market?
• How competitive do you want to be relative to the market?
• What do you want to reward?

In working with clients, I find they know the answers to the first two questions within a heartbeat. The third question, however, often leads them to stumble and to look to me for guidance. What are the options? What should we reward? At that point, I have to dig in deeper to their organization.

Use Data When Setting Raises, But Don't Stop There

How the PayScale Index Fits Into Raise Planning

By Tripp Ritter, PayScale.com

Some high level strategic thinking and data gathering must happen before raises can be given out. From following inflation and local market rate shifts, to considering business goals and budget constraints, HR professionals must be extra hard working and efficient with their time to pull off smart merit increases. How can all of the information gathering be simplified? When do you have enough input to make a smart decision?

A Way Around the Pay Gap?

Should You Tell Your Applicants About Your Pay Ranges?

By Tripp Ritter, PayScale.com

Being interviewed for a documentary on the gender pay gap inspired one woman to construct legislation designed to eliminate it. Blogger Katie Donovan has proposed the Salary Disclosure to Promote Equality Act with the aim of leveling the playing field for employers and employees in the salary negotiation  process. What does that legislation say and how could it affect employers?

In the Talent Wars, Compensation Matters. So Does Communication.

Real Life Lessons From VerticalResponse

By Tim Low, PayScale.com

The PayScale Talent Wars event series hit San Francisco last week. Among other speakers, Kate Aughenbaugh, Director of HR at VerticalResponse, a Bay Area marketing and social media platform company, spoke about her experiences working with PayScale to implement a compensation strategy. 

Managing Employee Pay with Ranges

Options For Handling Outliers

By Mykkah Herner, MA, CCP, Compensation Consultant at PayScale

You've just finished benchmarking all your jobs. You’ve established some ranges for your positions. Maybe you even have a structure, with grades, to which you’ve assigned each position. You’re ahead of the game, with most of your work is behind you, right? Well, yes and no. Inevitably some employees will fall below your range, and some may fall above. Now it's time to manage employee pay based on the ranges you’ve developed.

The PayScale Index: Which Jobs Do Best?

Is Your Job One of the Winners?

By Tripp Ritter, PayScale

Earlier this week, we saw that The PayScale Index revealed major differences in wage growth among metros. Hold on to your hats, because the differences in wage growth among jobs is even more stark. The leading job's wages raced ahead nearly 10% since 2006. The last place job did so poorly that it has lower wages than in 2006! You can find all the details in the The PayScale Index, but we also have an infographic showing the top and bottom three. Find out how your job fared in the past few years.

The PayScale Index: Which Cities Do Best?

Where are People Making More Money?

By Tripp Ritter, PayScale

The economy, on the whole, is on the way up. If that doesn't ring true, it could be where you live. There are significant differences in wage growth between major metros. The PayScale Index breaks the differences down for you. Is your metro a leader or is it a lagard? Find out now.

The PayScale Index: Wages Finally Climb Back

The Economy Really is Recovering

By Tripp Ritter, PayScale

PayScale’s data on the economy can get pretty specific. With tens of millions of data points on jobs, we often drill deep down to see what is happening in a particular industry or in a particular city. Other times, we take a look at the economy as a whole. When we want to look at what is happening in the economy at all levels, we turn to The PayScale Index.

How to Handle Prospective Employees with Tattoos?

Set Your Tattoo Policy with Care

By Tripp Ritter, PayScale

Here's a problem HR managers didn't face in the good old days. What to do about prospective employees who have facial piercings or visible tattoos? Is it any different for existing employees? The questions matter for more and more employers. A surprising number of potential hires are tattooed, and its not just the kids. According to the Pew Research Center, four of ten 26 to 40 year olds have at least one tattoo.  

Round Nonexempt Hours Correctly

Work-Time Calculations: Rules on Rounding Hours Q&A

“Rounding” is generally accepted under the FLSA, but only as long as the rounding practices “average out” and nonexempt employees are paid properly for hours worked. Find out how to implement this practice in your workplace.

Building a Better Incentive Plan

Blending the World at Work and Brad Hams Approaches

By Mykkah Herner, PayScale.com

Last month, I read and reviewed Brad Hams’ Ownership Thinking, and promised to write more on his sense of having the right incentives. While I thought he has some useful suggestions, I found his incentive plan to be both too prescriptive and too detailed.

Ultimately, I find that World at Work, the experts in the compensation field, explain incentives best. So, rather than spend a lot of time on a plan that can use a little more cohesion and a little more variability, I’ll focus on World at Work’s explanation of incentive plans, and weave in some gems from Hams. World at Work focuses on three stages: pre-design, design, and implementation.

PayScale and Cornerstone on Demand Reveal Talent War Secrets in Four Cities

Need to Retain Talent? Learn from the Pros

By Tim Low, PayScale.com

You probably just know us from the Web, but there are, in fact, real live humans here at PayScale, and we're coming to a town near you.

Are Traditional Compensation Surveys Right for Your Business?

Age is Wonderful for Wine, but Deadly for Data.

By Tripp Ritter, PayScale.com

Many compensation data providers offer well-constructed data products based on reliable data. . .that just happens to be months old. PayScale believes this aged data is not what today's decision-makers need, which is why we came up with a more timely way to collect and organize compensation data.

Setting Merit Budgets This Year

Is Three Percent the Right Merit Budget for Your Organization?

By Stacey Carroll, PayScale.com

I get the phone call a lot. It goes something like this, “Stacey, my CFO wants to know what the average increase other companies are giving this year so we can determine our merit budget. Can you tell me?”. I can. The short answer is from everything I’ve seen and read recently, most organizations are planning on giving anywhere between a two to three and a half percent increase in 2012. But, the better way to answer the question is: “Why is ‘what everyone else is doing’ our approach to compensation”? In reality, what your organization should pay as a merit increase for 2012 is going to depend on many factors – but here are just three.

California Laws on Compensation

Compensation Issues in California

By Beverly N. Dance, MBA, SPHR-CA, CCP, CEBS, dance@mba.berkeley.edu

I love my home state of California, but when it comes to pay and human resources issues, there is a reason California is the one and only of the 50 states that has its own separate certification exam above and beyond the national Professional Human Resources, PHR and Senior Professional Human Resources, SPHR. If you have employees in California or are considering bringing jobs to this state (PLEASE DO) here are a few new details you should know due to AB 469. (No need to mention to your employees that the legislation is called the Wage Theft Prevention Act of 2011.)

Bigger and Better Raises in 2012

2012 Trends in Compensation and the PayScale Compensation Best Practices Report

By Tim Low, PayScale.com

Today we released the PayScale 2012 Compensation Best Practices Report. The report is a result of our end of year study on the compensation practices of small, medium and large companies. We also asked some questions about the changing world of work, the use of social media at work and for work, as well as some additional questions on technology use in HR.

Do Not Talk Pay with Your Competitors

Why It’s Dangerous to Pay Like “The Guy Across Town”

By Melissa Quade, CCP, PayScale.com

I hear this from my clients all the time:

“I just want to know what MY COMPETITOR 1 and MY COMPETITOR 2 are paying, so I can pay 5% higher.”

“Can you make sure that I only get data from ALL OF MY COMPETITORS in this report?”

“Why can’t I see which companies pay what in this report?”

The short answer is: collusion. It’s a big no-no.

The Pros and Cons of "Ownership Thinking"

Ownership Thinking: Can It Help Your Business?

There’s been some buzz in business circles about Brad Hams’ Ownership Thinking: How to End Entitlement and Create a Culture of Accountability, Purpose, and Profit. This weekend I sat down to see what the fuss was about, and found some interesting and some not so interesting points in his work.

HR Funnies: Compensation Consultant Shares Insights

Need a Laugh? Check Out Our Comp Consultant's Job Review

By Bridget Quigg, PayScale.com

What is it really like to work in compensation consulting? Our very own PayScale compensation consultant, Melissa Quade, decided to share her thoughts about her job through photos.

NYC Salaries at Fashion Week

Gisele Tops Earnings at Fashion Week NYC

By Bridget Quigg, PayScale.com

As if Gisele's recent comments on the New England Patriot's football skills didn't draw her enough media attention, now one of the biggest weeks in her industry has arrived, Fashion Week New York. We may soon enjoy more of her colorful comments and glossy photos in the news when this glitzy gathering begins tomorrow. PayScale decided to look beyond the glamour with our worker-centric infographic, "Salaries on the Scene at Fashion Week."

Be Careful with Unpaid Summer Interns

FLSA Series Part 4: Interns or Apprenticeships

This is the fourth of a series of articles explaining the complicated Fair Labor Standards Act, FLSA, or the Wage and Hour Law. January and February are often when organizations are deciding if they can bring on summer interns. Many organizations would like to do this, but not all can afford to create opportunities for work of limited duration. What may motivate you to develop an intern program is that you may be able to pay your intern less than minimum wage under certain circumstances.

Career Showdown: New York Fans vs. New England Fans

Career Advantage: New York Battles New England

By Bridget Quigg, PayScale.com

How about an Human Resources showdown on Feb. 5, instead of the gridiron battle? What would happen if you pitted New York versus New England based upon career-enhancing factors like shorter commute time, higher pay and lower work stress? You'd get PayScale's "Fan Face-Off XLVI: Which Team's Fans Have the Career Advantage?"

Canadian Cities Battle for Winning Wages

From Vancouver to Montreal: PayScale Covers Canadian Cities’ Wage Trends

By Bridget Quigg, PayScale.com

The next time a Vancouver Canuck fan jabs a Montreal Hab supporter, the Hab can come back with, “Well, our pay is growing faster than yours!” Is it? Yes, according to PayScale.com. The PayScale Index now includes trends for six Canadian metros and if you look at the ranking, Montreal is ahead of Vancouver by 0.4 percent in the last 12 months. Can you guess which town is number one?

Salaried Employees Work Hours: Laws from FLSA

Exempt Employees and Rules Requiring Specified Hours

You probably are aware that exempt employees generally should be paid the same salary regardless of the number of hours they work or the quantity of work they produce. But, can you require them to work a certain schedule and track their hours?

Simplified Compensation Software - PayScale’s 2012 Winter Release

Your Life Is Now Officially Easier

The product team here at PayScale just released its latest version of our compensation planning software, PayScale Insight. We want you to know about the improvements we've made because they were inspired by people like you, the hard working HR professionals and business owners out there who face the task of determining base salaries, raises, bonuses and countless other major compensation-related decisions every day.We hope you'll find that the newest Insight features make sense to you and provide the elusive "helping hand" you've been waiting for.

How to Determine New Employees' Annual Bonuses

When to Give an Annual Bonus to a New Employee

Chances are, you have recently been tasked with the job of determining (or at least helping to determine) what your employees’ end-of-year bonuses should be. With your long-term employees, you've have had some historical practices, as well as a, hopefully, comprehensive performance review to rely on to help you. But what do you do with employees who haven’t been with the company for a full year, including those who may have joined very recently? While there are no hard and fast rules, here are some approaches for you to ponder.

Salary Negotiation Tips for Employers

How to Respond to a Request for a Raise

It’s that time of year again: the annual salary budget has been set, performance evaluations are done, and suddenly managers are hiding behind closed doors, anxiously dreading “the talk.” The annual compensation conversation doesn’t need to be a daunting, mysterious process, either for managers or the staff they supervise.

Wages Trend Up to Finish 2011 Ahead

Rising Wages Signal Shift in Q4 2011

By Bridget Quigg, PayScale.com

PayScale released its results for The PayScale Index for Q4 of 2011 and you may be surprised to find out where workers' wages went in 2011. They are up across the board for the first time in a long time. While certain skills sets were in higher demand and some cities stayed in a slump, in general, earnings grew somewhat for the majority of workers by year-end 2011.

Best Stories of the Year

A Look Back: Top Stories of 2011

By Bridget Quigg, PayScale.com

As we head into 2012, HR leaders and business owners can take heart in the more positive unemployment news and the (spoiler alert) optimistic, soon-to-be-released Q4 2011 results for The PayScale Index. The economy made forward progress in 2011. What was on our readers' minds and what were the favorite stories and topics here on Compensation Today? The following list highlights the hottest, not-to-be-missed posts of 2011.

FLSA Child Labor Laws

FLSA Series Part 3: Child Labor Laws

This is the third of a series of articles explaining the Fair Labor Standards Act, FLSA, or the Wage and Hour Law. This article will discuss the child labor laws under the FLSA. Be aware that to be in full compliance, you should also check to see if your state has additional regulations. I know my state of California does.

Rules on Pay After a Resignation

Do Voluntary Resignations Require Advance Notice?

When you’re watching your labor costs, it is important to know how to handle an employee resignation, compensation-wise. If you require employees to provide two weeks’ notice of their resignation, you may have to pay them for that full period even if you release them earlier. But, even if you only request the advance notice, it still may be better employee relations to pay for that full two-week period.

Listen Up, Mr. Scrooge! PayScale Compensation Plan Advice

What We Would Teach Ebeneezer Scrooge About Compensation

“Bah, humbug! Why should I pay my people another dime?”

Beware, Managers, don't follow Scrooge’s miserly ways when it comes to compensation. As the classic tale goes, through various ghostly visits, our friend Mr. Scrooge learns to get into the holiday spirit and finally rewards his hardworking employee, Bob Cratchit, with a raise and a "discussion of his affairs." How would PayScale advise Scrooge to adjust his compensation philosophy for long-term success?

What Small Companies Really Need from HR

Large and In Charge: The Strategic Role of HR at Small Companies and Non-Profits

With the buzz around talent management, organizational development, and management circles, the role of HR is becoming more sophisticated in larger organizations . But, in smaller companies and non-profits, HR professionals often still fill more traditional roles in areas like recruitment, benefits, payroll, and evaluation processes – not to mention being the on-staff therapist. It’s time for small organization HR professionals to dig out from under the heavy lifting and get into more strategic positions in the company. The company needs them to do so, and here is why.

Handle Questions About Your Comp Decisions

Are You Ready to Explain Each Employee’s Pay?

How well can you explain your compensation plan to your employees? What if you were asked detailed questions by a valued employee about their pay? Would you be ready to respond?

Small Company CEOs Work Hard and Earn Less

Less Pay for Small Company CEOs

Thanks to bank bailouts, Occupy Wall Street and other news, there is a lot of attention on CEO pay right now, especially as it compares to the average wages of employees. Whether you agree or disagree with a CEO making high wages at Fortune 1000 companies, it’s hard to argue that CEOs and other C-suite employees at small organizations are being overpaid.

Do Attractive People Get More Jobs and Money?

Good Looks Ensure More Jobs and Better Pay

By Bridget Quigg, PayScale.com

Nervous job interviewees may review their answers to common questions, shine their shoes and reapply their lipstick, but there are certain job interview success factors they cannot control, like their height and facial symmetry.

FLSA Compliance - "11 Main Test" for Independent Contractors

FLSA Series Part 2: Independent Contractor or Employee?

This is the second of a series of articles explaining the Fair Labor Standards Act, FLSA, or the Wage and Hour Law. Since the FLSA only applies to employees and not independent contractors, it behooves you to know how to make the distinction. I attended a recent continuing education class where the employment lawyer suggested anywhere from 10 percent to 30 percent of independent contractors paid on 1099s should really be classified as employees.

Record Black Friday Sales Signal a Shift

Hot Holiday Spending Begs Review of Comp Practices

By Bridget Quigg, PayScale.com

You’ve likely heard the news that Black Friday and Cyber Monday spending topped all previous records - ever. “Where did they get that money to spend in a down economy?” you may wonder. “Is it still that far down?” would maybe be a better question. Considering the news, if you’re an employer, it may be time for you to review your current pay strategy and get up to date with the latest hustle and bustle.

Why We're Thankful for HR

By Bridget Quigg, PayScale.com

Happy Thanksgiving from everyone here at PayScale, and especially the Compensation Today team. When asked why everyone should be thankful for HR, PayScale's Director of Professional Services and Education, Stacey Carroll, said,

"You are the heart and soul of your organization, you keep everyone in line and you always do it with a smile on your face."

Non-Profit Compensation in a Down Economy

Reality Check: Why Non-Profits Need to Evaluate Their Pay Practices in Today’s Economy

The past few years have been tricky for many non-profits. Those that have weathered the recession have done so because they have had great financial advisors or have been really creative. While our private-sector counterparts may be starting to see the light at the end, many non-profits are still struggling.

Holiday Pay for Employees

Answers to 7 Holiday Pay Questions

Do you have to provide paid holidays? What about for new employees? And do you have to pay overtime to employees who have to work a holiday? We’re officially heading into the holiday season with Thanksgiving coming up next week and Christmas and the New Year just around the corner. If you are like most employers, you may be dealing with holiday pay issues. To help you out, here are the answers to seven common holiday pay questions.

Comp Basic: Mean vs. Median

The Difference Between Mean and Median

Midpoint, market ratio, mean, median, merit bonus - I don’t know what it is with “m” words in compensation, but there are a lot of them and it can get confusing. Let’s try to simplify things by breaking down the difference between two commonly confused words: mean and median.

Tips for Entry-Level Recruiting

Building an Entry-Level Talent Network

By Brian Heifferon, AfterCollege

Recruiting can be a thankless business. Recruiters know that the news headlines about historically high unemployment only tell a small part of the story. The fact is, it’s actually harder than ever to find highly qualified candidates in industries like high tech, engineering, accounting, science and healthcare. This shortage of in-demand talent is even more pronounced when you’re trying to identify top college students and recent graduates.