An employer should have a compensation philosophy that is embraced by their
mission statement. Compensation consists of total pay – pay and benefits.
Consistent administration of pay is important to any employer and upholds the
compensation philosophy. An employer should have salary administration policies,
which will result in consistency across multiple locations, accomplish improved
employee morale toward compensation, ensure internal and gender equity and
external competitiveness.
Salary administration policies coordinate with the organization's compensation
philosophy, job descriptions, salary grade/range structure, merit matrix and
performance management system, promotional guidelines and career pathing.
A typical list of salary administration policies might include, among others:
Promotion increase
Starting salary rate for new hires
Merit increase
Pay for performance vs. pay for seniority
Employees who attain maximum rate of range or are over maximum
Lateral transfer
Employees who are below minimum of the salary range for their job
Salary continuation policies for employees on leave for multiple
reasons – disability leave, jury duty, reserve duty, personal leave,
disciplinary leave, bereavement and partial days worked among others
Equity adjustments
Geographic differentials
Demotions (performance related change to lower job) including salary
protection
Job reclassification. I.e. grade change
Downgrades (non-performance related change to lower job such as
job eliminated or reduction in force)
Pay for unused vacation
Separation pay for vacation not taken
Travel pay for non-exempt employees
Holiday work pay – exempt and non-exempt
Rehire pay
Severance
Temporary assignment or developmental assignment
Part-Time employee pay
Premium pay for exempt jobs
Differentials pay for shifts and/or weekends
On-call pay
Reduction In Force - General
Based upon THRD's extensive experience in compensation and salary administration,
we can help you select those policies that are necessary for your organization
and write them for you.
To discuss salary administration policies for your organization, contact
us.
