Employee retention is a double-edged sword.
According to Merriam Webster, in addition to being a sword with two sharp edges, this is defined as something that can have both favorable and unfavorable consequences.
That’s about right. Read more…
Picture the scene:
Your company doesn’t have enough money in the annual merit spend budget to grant more than an average 2 percent increase to employees, so the powers that be decide “let’s give everyone a flat 2 percent increase and call it a day.”
Has this happened to you? The practice is what some would call a “pay-for-pulse” strategy, where if you haven’t been fired on the date of the scheduled increase, then you’re going to get a raise.
Germany defeated Argentina to win the coveted FIFA Trophy last weekend, and one of the most tumultuous World Cups in recent history finally came to a close.
According to analysts it was also the most expensive World Cup in history, with the largest purse ever offered to the finalists, totaling over $350 million.
All 16 semifinalist countries will walk away with a cash prize — the Germans will return home $35 million richer, and the Argentinians will face the sting of defeat on a bed of $24 million. Even Brazil, who lost to the Germans in record-breaking fashion in the quarterfinals, will take home $18 million for fourth place. Read more…
Ann Bares recently wrote a predictive article here on TLNT about the potential end of merit pay (How Will We Pay With Open Salaries and No Performance Reviews?).
In her post, Ann argues that because “open salaries” and “blowing up performance appraisals” are becoming more popular, merit pay cannot be long for the world. She ends by asking:
What will we do instead? Strictly market-based wages with “hot skill” premiums as appropriate? More emphasis on variable pay plans designed to reward specific, pre-determined individual or group metrics? Will recognition and non-cash rewards step into the void to provide the necessary differentiation for key talent?” Read more…
What is the future of salary management? If current trends continue, employers will be forced to adopt a new program model.
Here are the reasons:
First, pay transparency is the future. Those who have worked in the field for any period know it has changed dramatically over the past two or three decades.
Not too long ago employees were told nothing more than their salary. Now, there are employers like Whole Foods that make everyone’s salary public. Read more…
The use of sign-on and retention bonuses appears to be at an all-time high, according to a recently released WorldatWork survey on bonus programs and practices.
The research, which highlights the practices of 713 organizational participants, is the fifth iteration of a series that dates back to 2001.
Among other things (like the volatility of today’s labor market), these findings tell us that an increasing proportion of the reward dollars needed to attract and retain talent are being channeled into things other than fixed base salaries. Read more…
Forbes.com calls itself, “Information for the World’s Business Leaders.” A must-read for most serious business people, it has never been known as an advocate for social change.
Yet what was its most popular blog post this week? An article in the “Entrepreneurs” section titled, “Employees Who Stay in Companies Longer Than Two Years Get Paid 50% Less.”
There are a number of movements afoot in the world of work that promise to impact the way we pay people. Two in particular may well converge to provide the final straw that breaks the back of merit pay.
Let’s begin with Exhibit 1: The “Open Salaries” Movement.
Pay transparency is coming. While it is unlikely that we will reach a point where every organization opens up all compensation information for every employee, I believe that the momentum and spirit behind the pay transparency movement will lead many employers to eventually embrace it, drawing back the curtain to reveal the details of their pay programs and practices. Read more…
By John E. Thompson
The U.S. Department of Labor has released its proposed regulations implementing Executive Order 13658, President Obama’s directive to raise the minimum-wage rate for workers on federal contracts from $7.25 per hour to $10.10 per hour (subject to annual increases after 2015).
We wrote about this initiative earlier in the year; we will not repeat those discussions here.
Identifying all ramifications of the 181-page Notice of Proposed Rulemaking will necessitate a careful review. However, at least some ambiguities of the Executive Order itself appear to have been clarified. Read more…
Earlier this month, the Seattle City Council voted to approve a gradual increase in the minimum wage, ultimately requiring city employees to be paid $15 per hour by 2017, or 2018 if the employer has more than 500 employees.
Smaller businesses will have five to seven years to phase in the increase and in either case part of tipped employees’ earnings can be applied toward the higher minimum wage for as long as 11 years. The new minimum wage ordinance will take effect April 1, 2015, when city employees making minimum wage will receive a mandatory increase to $10 per hour.
Clearly, the increase in minimum wage will have legal ramifications for both employers and their employees. Read more…