Chapter 9 Compensation Management 301 Exit Interview Results was making some calls. I just had our two top candidates As she sat down in Rebecca's office, Charlotte said, "How for that software position turn me down. Both of them said did the exit interview go we weren't offering as much as they were hoping for. Could Rebecca sat down behind her desk and slipped off her it be that we don't pay well? That seems weird to me. I've shoes. She was feeling a little worried. She said. "Not great heard some people say that we are very generous." I mean he was really open, but the news is bad. The com "Both those candidates said no?" Rebecca asked, her pensation problem might be even bigger than we thought." voice heavy with disbelief. "It took forever to find them. "Uh oh," said Charlotte with a grimace. "What did Let's look at upping the offer." he say? Charlotte replied, "The offers were already a little above Looking at ler notes. Rebecca replied, "He said he what we usually start people out at. But I guess we can do decided to leave when he found out Abigail Desai, the new it if you think that's a good idea." accountant, was getting paid $13.000 a year more than him." Rebecca sat back in her chair and gaxed out the window Charlotte gasped, "How did he find that out? Salaries as she said, "Let me think for at minute. This is a fough one. are supposed to be confidential! Talk about being stuck between a rock and a hard place. If Shrugging, Rebecca said. "They always find out we don't go higher, we won't be able to hire good people Charlotte. You can count on it. No matter what we say peo But if we do go higher, the people we already have will feel ple will talk. Salaries never stay fully confidential." like they are getting the short end of the stick. I'm honestly Charlotte countered, "Still, I don't get why he's mad not sure what to do next." She should make more than him. Abdul's job as a financial "What if we're focused on the wrong thing?" Charlotte coordinator is important, but Abigail is an accountant and thought out loud, and then continued, "What if we should that job has some serious responsibilities. That's why that be looking at other ways to pay people that won't make job requires a lot more education and certification. Plus, salary comparisons between old and new employees a she has a master's degree! That has to count for something. problem? On top of all that she is really good at her job. She has Rebecca picked up Charlotte's conversation thread worked for some pretty progressive tech companies. I know and said, "Charlotte, that's it! We should be looking at she has brought in some great ideas even in the short time options like hiring bonuses and retention bonuses. One she's been here." time payments that won't be ongoing increases in our staffing costs." Tempting Employees Away Now caught up in their brainstorming and happy to use some of her HR education, Charlotte replied, "And we Continuing Charlotte said, "I was talking to her boss about could look into variable pay options to reward our strong this just last week. He was asking what the process wally performers. We need to think beyond just salary to keep to increase her salary when she finishes her probationary the employees we've got happy and bring on some more period. She is so good that he is afraid he's going to lose top talent." her to another company. Apparently, she was seen having lunch with some people in suits, and the rumour is that it DISCUSSION QUESTIONS was an interview Rebecca groaned. "Don't tell me that! We can't have 1. Based on what you know about the company so far. another person lured away. Alex would lose his mind. From what compensation philosophy is WEC using? what I can tell he's still reeling from losing that project 2. How can WEC use job evaluations to determine base manager named Jake a few months back. He brought me in pay levels? Which job evaluation method should it at least partly to stop this sort of thing from happening. But use and how should that method be designed and first let's get back to Abdul and his problem with Abigail implemented? I don't know if he knew about her master's degree. He just noticed that their jobs are somewhat similar but she makes 3. What forms of variable pay do you think would be use- ful for Charlotte and Rebecca to consider implement- a lot more money even though he has been here longer. That really didn't seem fair to him. And he mentioned that his ing? Why? new job pays a lot more than what he was getting here. The 4. What can be done in the future to help ensure that scary part is, if he starts telling people that I wouldn't be WEC is perceived as having both internal and external surprised if more people start considering other options." equity Underwhelming Pay In the next installment of the WE Connections story (at the end of Chapter 10), the HR manager tries to convince Looking troubled. Charlotte replied, "I don't want to add her boss that they need to beef up their benefit program in fuel to the fire, but while you were meeting with Abdul order to keep employees satisfied. Chapter 9 Compensation Management 301 Exit Interview Results was making some calls. I just had our two top candidates As she sat down in Rebecca's office, Charlotte said, "How for that software position turn me down. Both of them said did the exit interview go we weren't offering as much as they were hoping for. Could Rebecca sat down behind her desk and slipped off her it be that we don't pay well? That seems weird to me. I've shoes. She was feeling a little worried. She said. "Not great heard some people say that we are very generous." I mean he was really open, but the news is bad. The com "Both those candidates said no?" Rebecca asked, her pensation problem might be even bigger than we thought." voice heavy with disbelief. "It took forever to find them. "Uh oh," said Charlotte with a grimace. "What did Let's look at upping the offer." he say? Charlotte replied, "The offers were already a little above Looking at ler notes. Rebecca replied, "He said he what we usually start people out at. But I guess we can do decided to leave when he found out Abigail Desai, the new it if you think that's a good idea." accountant, was getting paid $13.000 a year more than him." Rebecca sat back in her chair and gaxed out the window Charlotte gasped, "How did he find that out? Salaries as she said, "Let me think for at minute. This is a fough one. are supposed to be confidential! Talk about being stuck between a rock and a hard place. If Shrugging, Rebecca said. "They always find out we don't go higher, we won't be able to hire good people Charlotte. You can count on it. No matter what we say peo But if we do go higher, the people we already have will feel ple will talk. Salaries never stay fully confidential." like they are getting the short end of the stick. I'm honestly Charlotte countered, "Still, I don't get why he's mad not sure what to do next." She should make more than him. Abdul's job as a financial "What if we're focused on the wrong thing?" Charlotte coordinator is important, but Abigail is an accountant and thought out loud, and then continued, "What if we should that job has some serious responsibilities. That's why that be looking at other ways to pay people that won't make job requires a lot more education and certification. Plus, salary comparisons between old and new employees a she has a master's degree! That has to count for something. problem? On top of all that she is really good at her job. She has Rebecca picked up Charlotte's conversation thread worked for some pretty progressive tech companies. I know and said, "Charlotte, that's it! We should be looking at she has brought in some great ideas even in the short time options like hiring bonuses and retention bonuses. One she's been here." time payments that won't be ongoing increases in our staffing costs." Tempting Employees Away Now caught up in their brainstorming and happy to use some of her HR education, Charlotte replied, "And we Continuing Charlotte said, "I was talking to her boss about could look into variable pay options to reward our strong this just last week. He was asking what the process wally performers. We need to think beyond just salary to keep to increase her salary when she finishes her probationary the employees we've got happy and bring on some more period. She is so good that he is afraid he's going to lose top talent." her to another company. Apparently, she was seen having lunch with some people in suits, and the rumour is that it DISCUSSION QUESTIONS was an interview Rebecca groaned. "Don't tell me that! We can't have 1. Based on what you know about the company so far. another person lured away. Alex would lose his mind. From what compensation philosophy is WEC using? what I can tell he's still reeling from losing that project 2. How can WEC use job evaluations to determine base manager named Jake a few months back. He brought me in pay levels? Which job evaluation method should it at least partly to stop this sort of thing from happening. But use and how should that method be designed and first let's get back to Abdul and his problem with Abigail implemented? I don't know if he knew about her master's degree. He just noticed that their jobs are somewhat similar but she makes 3. What forms of variable pay do you think would be use- ful for Charlotte and Rebecca to consider implement- a lot more money even though he has been here longer. That really didn't seem fair to him. And he mentioned that his ing? Why? new job pays a lot more than what he was getting here. The 4. What can be done in the future to help ensure that scary part is, if he starts telling people that I wouldn't be WEC is perceived as having both internal and external surprised if more people start considering other options." equity Underwhelming Pay In the next installment of the WE Connections story (at the end of Chapter 10), the HR manager tries to convince Looking troubled. Charlotte replied, "I don't want to add her boss that they need to beef up their benefit program in fuel to the fire, but while you were meeting with Abdul order to keep employees satisfied