Money. Money. Money. The power of the almighty dollar is the reason so many dedicate so much of their lives to a job, and yet it so often goes unmentioned in the workplace. It is the reason workplaces function in the first place, the reason why employees exist to begin with, and is the very fabric of our lives (for better or worse). And yet, still, it hides in the shadows. Companies’ revenue and profitability are shrouded in secrecy. Paychecks are deposited with nary a word of the transaction. But—why? Why is something so significant so secretive?
Well, commercial and corporate culture undoubtedly play a role, but for the sake of employees, it’s time to lift the curtain. Transparency is of the utmost significance, and not just because it sounds right, but because it will increase employee satisfaction, engagement, and loyalty. If workers understand why they are being paid what they are being paid, and that salaries are not just some arbitrary number primarily influenced by—what could be potentially perceived as—executive greed, they will be more likely to not just accept their pay, but embrace it. In order to broach the uncomfortable topic of finances, there are a number of things you can do. Below are some of the most effective:
Implement a transparent policy
When workers complain about pay, it is most likely not due to any sort of greed (note I said most likely) but is probably the result of ignorance. They are just ignorant of the market and what others are being paid. When salaries are solely discussed behind closed doors, facts are thrown to the wind and details fall by the wayside. Hearsay runs rampant and destroys employees’ perception of their company if their paycheck falls flat.
In fact, a Glassdoor survey completed in April concluded that almost seventy percent of the 8,254 employees questioned wished for a better understanding of what fair pay is in their industry for their position. By not making pay transparent, companies are encouraging employees to turn to other less credible sources for their information, which is understandably dangerous for company culture and morale.
Determine a suitable strategy.
Determining and managing employees pay should by no means a one-size-fits-all policy. Different employees have different needs. Yet, of course, pay should not be solely determined by need. Rather, pay should be oriented in such a way that it attracts top talent, encourages new and old employees to grow, and provides a comfortable living.
The best way to go about this is to compose a budget allocation and then figure out how much money will be dedicated to benefits and other incentives. Then assess an appropriate and competitive salary range. Research the local area, industry, and benchmark similar roles so that you can be sure what you are offering is not just acceptable, but desirable.
Keep up with the industry and routinely reevaluate salary ranges to remain positive you are attracting top talent in the area. Also, keep in mind that you should be analyzing data to determine bonuses in pay raises. By using performance as a metric, you are very clearly tying financially incentivizing your employees. To stray from hard data opens bonuses to subjectivity and thus unwanted scrutiny that could potentially result in the exact opposite desired effect, and de-motivate your employees.