After one week of data collection and many queries from customers, ERI decided to publish some early results of our May Coronavirus (COVID-19) Response Survey. There is a large enough sample to support this type of analysis, with 438 responses, so we started with the most frequently asked question: Which of the following best describes your compensation plan in response to Coronavirus (COVID-19)? This question had six responses: increasing compensation, continuing as planned, freezing pay, reducing compensation, still undecided, and other.
Organizations that responded to this question with “other” were provided an opportunity to tell us what other response they are taking. These responses tended to cluster around six options: hazard pay, increasing benefits (e.g., flexible PTO, compensation advances, etc.), targeted increases, targeted increases and decreases, targeted decreases, and slowing compensation growth. We should note, targeted increases were generally directed towards front-line hourly employees instead of exempt employees, while targeted decreases were generally focused on executive compensation.
Overall, 2.7% of organizations are increasing compensation, 49.3% are continuing as planned, 13.7% are freezing pay, and 10% are reducing compensation. Of note, the second most common response to this question was “undecided,” with 16.9% of organizations reporting. This response likely means that there is a possibility of pay reductions or freezes, depending on the long-term effects of this event.
| Organization Responses to COVID-19 | |
| Increasing compensation | 2.7% |
| Continuing as planned | 49.3% |
| Freezing pay | 13.7% |
| Reducing compensation | 10.0% |
| Still undecided | 16.9% |
| Other | 7.3% |
| “Other” Responses to COVID-19 | |
| Hazard pay | 2.3% |
| Increased benefits | 1.1% |
| Targeted increase | 1.8% |
| Targeted increase and targeted decrease | 0.7% |
| Targeted decrease | 1.1% |
| Slowing compensation growth | 0.2% |
ERI compiles salary survey data on a quarterly basis to help organizations understand and benchmark compensation rates. Find our how the coronavirus is expected to impact compensation,which specific industries are going to be heavily impacted from the COVID-19 and more from the ERI blog. Information published in our signature whitepapers captures salary changes throughout the year and helps HR professionals plan and develop business strategies.
ERI will continue tracking these changes through additional surveys and participant follow-ups. Please direct any questions or comments regarding ERI’s ongoing researching to Jonas Johnson, Ph.D., Jonas.Johnson@erieri.com.
