| The first step in establishing a wage and salary program is to establish a corporate compensation philosophy. For example, if it is a corporate policy to pay average wages within the geographical area, then the companies competitive wage rates should cluster around the 50th percentile when compared with rates paid by competing employers. In fact, different pay objectives may be established for different employee groups.
For example, the employer may wish to pay only average compensation to clerical personnel, but outstanding compensation to its data processing staff. These objectives should reflect management's judgment as to the relative importance of various employee groups in meeting the organization's profit objectives. A brokerage firm may perceive its professional research staff as the most vital employee group. The firm may have a salary goal of the 90th percentile for its analysts, while paying average compensation to its clerical staff.
With these perspectives in mind, EBS Consulting facilitates work sessions with the appropriate management staff to develop a Corporate Compensation Philosophy. This philosophy will encompass all aspects of base compensation, incentives, and fringe benefits. From this principal philosophy or foundation all programs, policies and procedures can be developed and implemented. |
