Time to Think about Merit Planning for 2010
Posted by Nancy Saperstone on Thu, Sep 24, 2009 @ 12:11 PM
Good news...the numbers are out and companies are planning for 2010 merit increases! So what does this mean for your Company? Regardless of the budget you set forth, you want to be sure you spend your money wisely. Here are a few tips to help you with your 2010 Merit Planning:
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Consider changing the language and/or process, even a simple play-on-words can change the meaning of the "merit" process. Migrating to a "Salary Review Process", whereby the company reviews each employee's salary relative to the external marketplace will ensure that multiple factors go into determining what the salary action is: market value, individual performance and what the company can afford to spend.
o Focus on your key performers: Who is critical to retain?
o New hires and recent college grads: Is their compensation keeping up with the market?
o Average performers: If they're meeting "average expectations" they may not necessarily need a salary increase if they're keeping pace with the market
o Needs improvement: Take the time to work with those employees that need to improve their work. Document a Performance Improvement Plan to help them get back on track.
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What if you can't afford to do merit? Be honest with employees, tell them about current business conditions and don't forget to educate them on their "total compensation". Even if the Company can't afford merit, the value of their compensation and benefits is still meaningful. Consider doing a Total Compensation Statement to educate them on what you do offer (employee benefits, technology, training and development, etc.)
What is your Company planning to do for 2010 Merit Planning?