Getting compensation right is important for every business. Employers know this and work hard to provide fair compensation to their employees, but a compensation strategy should encompass more than just the amounts you pay. There are other practical concerns that can interest employees and should be considered in addition to the raw figures.
When was the last time you looked at how you pay your employees—instead of just how much? What about how often you pay your employees? What about when? Many employers figure out their payroll system once and then only address it again if they have to, whether because of some catastrophic failure or somebody new coming in and asking important questions. Yet there’s no reason why employers should wait; the best time to examine payroll is before a problem arises.
When compensation is wrong, everything else in an organization suffers, but the reverse is true, too. The better the compensation system works, the less employees have to worry about it, and the more time and attention they can devote to their jobs. Developments in technology, including the financial technology (or fintech) sector, have opened up new options for employers beyond the traditional biweekly paycheque. Not every new solution is appropriate for every business, but it’s worth at least thinking about how you do things now and whether your methods are really the best ones for you and your staff.
Your system was probably perfect for your needs at one time, but maybe your business has changed, or your staff has different financial needs now. Auditing practices every so often is important throughout every aspect of HR management, and as important as compensation is, it shouldn’t be overlooked.
Auditing HR practices is a good habit to get into, but when the practice is something as important as compensation, you need to be careful, and not rush into upending established practice. Download our Guide to Compensation for an outline of steps you should take when auditing your payroll practices, as well as some suggestions for avenues to explore.
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