Increasing Pay Transparency Leads To Increased Pay Satisfaction

May 18, 2010 - PRLog -- According to HR Solution’s National Normative Database, comprised of 3.3 million respondents from 2,400 organizations, 37 percent of employees have thought of resigning in the past six months.  When asked why an employee chose to leave his or her last job, 23 percent answered that it was because he or she could receive better compensation elsewhere.  Employees often perceive that they are not making as much as their peers when they are actually being compensated equally.  By making an organization’s compensation plan more transparent, organizations can actually help employees understand that they are being compensated fairly for their hard work.

To increase compensation transparency, organizations can provide accurate, up-to-date information about how much their peers earn in similar jobs, compare their salary increase scale to other organizations’, and share their current compensation plan with employees.  Organizations should also strive to keep their compensation plans consistent from year to year to increase transparency.  

“It is important for organizations to know whether their pay scales are at or above average for their industry and location,” said Kevin Sheridan, CEO of HR Solutions.  “Organizations that meet this goal should share this information with their employees.  Increasing pay transparency may seem counterintuitive due to the privacy that surrounds salaries, however, increasing knowledge and understanding about an organization’s compensation program will help to increase satisfaction with existing programs.”  Taking simple steps to increase compensation transparency will help to increase pay satisfaction within an organization and let employees know how their organization is compensating them versus competing organizations.

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HR Solutions, Inc. is an International Human Capital Management Consulting Firm located in Chicago, IL, specializing in Employee Engagement and Exit Survey design, implementation, and results. Contact www.hrsolutionsinc.com or call 312-863-6104 for info.