SalaryTrends 
 
FreshView
a publication of Cascade Employers Association
 

APRIL 2012    

   Dollars & Sense Poll

  In This Issue:

 

 

Pay Strategy In An Uncertain Business Climate: Part II

Last month in FreshView, Jerry talked about how views are mixed among Oregon executives regarding the future of our economy. He stated that “while some believe a rebound is imminent, others fear further decline or even a bust.” Given these uncertainties, he provided summary data regarding what organizations are projecting for revenue, hiring and salaries for 2012.

This month Jerry addresses compensation strategies that he believes will be most effective in our uncertain business climate. He recommends “flexible” pay strategies and practices that align pay with business results.

Flexible Pay Strategy

From a Human Resources perspective, how much should organizations pay employees to support their recruiting and retention objectives when the future business climate is uncertain? Obviously, the compensation package has to be “enough” (whatever that means). But, it must also be affordable to the organization in both good times and challenging times. To this end, I would avoid a pay package consisting of wages, salaries and benefits that are too much above competitive market norms (e.g., top quartile). Why? Because the organization would be stuck with the higher compensation costs when they can’t afford them … which could lead to employee pay reductions and layoffs in tough times.

For organizations that want to share their success with employees by paying more, a healthy alternative to higher salaries and benefits is a variable pay plan (incentive or bonus pay). With a variable pay plan, employers have greater flexibility in how much and how competitively they pay because payouts should be based on performance … especially organization performance. When business is good, variable pay plans can still result in upper market quartile pay practices. On the other hand, when company results are not so good, employee cash compensation may be at or even below competitive market norms.

In summary, I believe organizations are best served by a pay strategy that allows them to “flex” the level of compensation paid to employees based on business results. While it is important to be confident that your wages, salaries and employee benefits are reasonably competitive (not too high and not too low), by supplementing the compensation package with a variable/incentive component you will be able to pay employees more competitively when the organization can afford it. Some key pay strategy considerations to remember include:

  1. Align pay and benefits plans with business goals and results
  2. Design pay plans to attract, engage and retain the “right” people
  3. Incorporate the right amount and mix of compensation
    1. Total compensation focus (base, variable/bonus, and benefits)
    2. Enough for employees and affordable to the organization
    3. Appropriate compensation positioning versus your competitive market
    4. Equitable internal pay relationships
    5. Linkage between pay and performance (employee and company)
  4. Include training, participation and abundant communications for clarity

About the Writer

Jerry Bumgarner is the Director of Research & Compensation Services at Cascade Employers Association in Salem. A caring and practical minded compensation professional, Jerry makes linking pay and performance easy to understand and apply. Cascade members who call on him recognize his knowledge and experience, and appreciate his sincere interest in supporting their business success through strategic pay and performance management practices. The creator of SalaryTrends®, Cascade’s innovative “Evergreen” online survey system, Jerry also directs local, regional and national surveys and serves as a national employer association research leader.

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Unemployed in Oregon Protected From Discrimination

By Jenna Reed, JD, MBA
Director, HR & Compliance Services
jreed@cascadeemployers.com

On March 27th, Oregon Governor John Kitzhaber signed new legislation that prohibits employers from discriminating against unemployed individuals who are seeking employment. Effective immediately, the new law prohibits employers from publishing in print or on the internet job advertisements with qualifications that applicants must be currently employed, that state applications from individuals who are not currently employed will not be considered, or that state only applications from individuals who are currently employed will be considered.

Employers are not prohibited from posting jobs internally with the requirement that only applications of current employees will be accepted. Job advertisements may also still require current licenses and certifications and other minimum qualifications. Simply stated, job advertisements may not exclude applicants for the sole reason of being unemployed.

Employers found in violation of the law will be assessed a $1,000 penalty by the Bureau of Labor and Industries.

Cascade recommends employers carefully review all job ads and make sure that language excluding unemployed candidates is removed.

If you have any questions or need assistance, please don’t hesitate to contact Cascade.

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Survey Spotlight

By Tina Hamel, Survey Manager
thamel@cascadeemployers.com

SalaryTrends® surveys from Cascade Employers Association cover the pay practices of diverse organizations from various markets (Oregon, SW Washington, Northwest Regional, and National), and include multiple relevant data summaries. These valuable tools enable users to evaluate their competitiveness within specific talent markets.

Now Open for participation:

Coming Soon:

  • IT & Engineering Survey (5/12/2012)

Contact us with questions at surveys@salarytrends.com.

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FreshView on Wage and Hour Compliance

By Patrice Altenhofen, JD, MBA, President
paltenhofen@cascadeemployers.com

Question: What are the top three supervisory issues in wage and hour compliance, and what points should be kept in mind when dealing when them?

Answer:

  1. A non-exempt employee is arriving early or staying late, without clocking in or out accurately.
    • All hours worked must be paid.
    • All overtime must be paid – employees cannot waive OT.
    • All overtime must be authorized.
    • Supervisors have the best opportunity to observe and manage employee work habits.
  2. A non-exempt employee is skipping breaks or lunches.
    • In Oregon, rest and meal periods are mandatory.
    • May not be combined.
    • May not be used to shorten the workday.
    • It is up to supervisors to ensure employees are taking breaks and lunches per company policy.
  3. An employee has questions about pay or how pay is determined, including their wage rate, overtime, travel or training pay.
    • Typically, supervisors are not experts in wage and hour rules, so they should be discouraged from answering these questions on their own, without support from Human Resources.

For more supervisor guidance, check out our webinar, Red Flags for Supervisors: When to Go to HR.

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Be Better At Your Job and Happier At Work

By Marney Roddick, Director, Training & Events
mroddick@cascadeemployers.com

Cascade’s training team took a fresh look at our popular HR Leadership certificate series and we have completely repackaged the course of study for you. Attend and you are guaranteed to leave with insightful strategies and practical tools to make you better at your job and happier at your work.

Our new program is designed to:Business Woman Graphic

  • Answer the most commonly asked people management questions
  • Increase your productivity and effectiveness in your job
  • Make you a more valuable resource for your team
  • Solve your toughest and most frustrating workplace problems
  • Facilitate networking with other professionals in your field

This business course is expanded, so even if your title doesn’t include “HR,” you will learn to lead people more competently and confidently.

You will learn to:

  • Build employee and peer engagement
  • Foster a strengths-based culture
  • Manage change
  • Infuse your company mission into your daily work
  • Master difficult conversations
  • Overcome the forces of overwhelm and overload
  • Strategically manage risk
  • Stay up-to-date on the latest leadership and human resource trends

Program Design:

The program still includes a total of 5 full days of training. Three days of required coursework are divided into two days at the outset of the program, and one day as a conclusion to the program. In between, attend four half-day electives of your choice.

Earn up to 40 hours of HRCI recertification credit! Learn more and register today.

Ask about discounts for returning participants and multiple registrations.

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Reader Poll

Cascade believes that happy employees make for happy customers.

We presently conduct surveys to gauge employee satisfaction and engagement. We are interested in expanding our service offerings to include Customer Satisfaction Surveys as well, and would appreciate your input.

Please click here to answer a quick, one-question survey to indicate your level of interest in Customer Satisfaction Surveys.

Thank you for your feedback!


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