Best Compensation Practices

Step three is to create a set of procedures and practices for ensuring that all decisions on compensation in the future are based on job-related criteria that are consistent with business necessity and are applied uniformly and consistently to each and every pay decision. Some best practices to ensure fairness in compensation programs that have been used by employers are: Conducting a job evaluation survey for each job in the facility to establish what the labor market in your area is paying for these occupations. Employers may choose to use "benchmark" positions for the sake of efficiency and economy. Training each individual who makes starting salary decisions in how to apply the company policy on starting salaries. Where pay is tied to performance ratings: Developing a performance rating system, with measurable criteria, that clearly differentiates between levels of performance. Ensuring that any subjective elements, such as "initiative", are operationally defined by providing concrete examples of what the element means. Ensuring that all rating managers are trained in the consistent and uniform application of the elements in the assessment of an individual worker's performance. Examining the impact of compensation decisions on minorities and women to assure that they do not have disparate impact on either of these groups.