“If the grass looks greener on the other side, it is probably AstroTurf.”
Everybody wants more money, people. This we know.
Internal issues related to pay are one thing. There’s also a big nasty world outside of your company that creates fear, uncertainty and doubt (FUD) across your employee base related to pay satisfaction.
Whether it’s macro-media reported items like the title of this section (Google mailroom boys actually only make 90K— feel free to use that) or “hard” pay data that’s available on a number of third-party sites (think Glassdoor and Salary.com), you’ve got to be ready to educate when employees bring you external pay data and the deal with the moaning that usually follows.
The big nasty world is going to lay FUD at the feet of your employees. Sometimes it’s directly related to recruiting them away from you, but more often than not it’s your employees being incredibly human, seeking the information out, then laying the nastiness at your feet.
The better you are at diffusing the external myths and helping employees compare apples to apples, the happier everyone is going to be. You don’t have to lie—you just need truthful talking points.
The good news for you related to external issues on compensation should be obvious—it’s nowhere near as flammable as internal issues. It’s still serious, but consider the following:
Would you rather an employee know what their co-workers make (and be on the low end of those comparisons) or see that some companies may pay more than your firm for the same job via a website like Salary.com or Glassdoor?
That’s obvious—you would much rather deal with the external issue than the internal issue. That being said, many of the tools you use to walk an employee through how you determine pay are the same in both situations, including the following talking tracks:
The world is a stage, and your managers need to be able to pull these off in a way that’s consistent with their personality.
1. We have a process we go through to determine what competitive comp is for all the jobs in our company (for more mature companies, this will include ranges);
2. When you joined the company, we arrived at what we offered you based on several factors—what you were making when you joined us and where we thought you should be in our range based on your experience and work history in the job/type of work;
3. We evaluate both of those factors—what the external world pays for similar work and where we feel you should be in a reasonable range based on your experience—on a periodic basis;
4. I feel good about where you are compared to what others make for the same work in the outside world based on these factors; and
5. Don’t forget you have a chance to earn more through your performance/merit increases with our company (if your company has that process in place).
Those talking points provide a roadmap for any manager to respond to pay issues triggered by internal situations or external data. Use them in your own language, add in your subject matter expertise that confirms you really believe they are paid competitively, and you’ve got all you need.
External pay issues/challenges come with an important feature that lowers the risk for companies. If someone truly believes they aren’t compensated enough for a job compared to the rest of the world, they have to go through the change management associated with finding and securing a new job. That’s change and humans are terrible at it.
Of course, employees dissatisfied with their pay aren’t good for business if they stay—that’s why you have to be ready for the issues and knock out the conversations as they come your way.
If your managers can’t deliver the talking tracks on demand, you’ve got some work to do. Key to all of this? They’ve got to own it and tell the person they feel good about where they are at—as long as they believe it.
If they don’t believe it, you’ve got some work to do.
FOT Note: This rant is brought to you by the good folks at Halogen Software who like us enough to be an annual sponsor at FOT for all content in our performance management track (and don’t expect that we run any of this by them ahead of time).