Salary Increase Planning

Implementation

The approach for implementing salary increases differs based on whether your organization is using an anniversary or focal review date.

Anniversary Review Date: An anniversary review date requires notification to management of each employee's anniversary review. Typically, management will receive a notification (online or email) of a pending anniversary review date. Adequate notification is needed to ensure the salary review takes place on time and required approvals are received. Key steps include:

• Notification
• Manager completes recommendation online or on a Status Change Form
• Required approvals are received
• Update/upload to HRMS
• Update/upload to Payroll for implementation
• Manager communication takes place
• Employee communication takes place
• Records management takes place

Receipt of timely recommendations may be challenging under an anniversary salary review date. Appropriate processes should be in place to ensure appropriate follow up to minimize late salary reviews.

Focal Review Date: Since a focal review date is managed at one time throughout an organization, it is best managed through an online process or through a worksheet. Key steps include:

• Announce implementation of program
• Train key stakeholders in the process (e.g., Human Resources, Finance, Payroll, Management, etc.)
• Distribute appropriate instructions, tools, and worksheets (whether supported by a comprehensive system or prepared through a worksheet)
• Manager completes recommendations through online system or worksheet
• Management approvals
• Roll up for final approval
• Approval
• Update/upload to HRMS
• Process/upload to Payroll for implementation
• Manager communication takes place
• Employee communication takes place
• Records management takes place
• Suggest feedback from key parties on annual review process for ongoing improvement

Automation

There are many online systems available to support an organization in automating the salary increase planning and administration process. Like most forms of budgeting, salary budgeting is a prime candidate for automation.

An automated process can increase accuracy and reduce the time it takes to:

• assemble the budget request
• AND
• analyze and process the data

It can also enhance financial reporting of salary planning, implementation, and the necessary controls to monitor year-to-date spending.

Major consulting firms and software development companies offer numerous systems to automate your salary budgeting. Programs range from simple to complex. Tools are available through the Cloud to automate these important processes.

As an alternative, Microsoft Excel worksheets are still widely used for salary increase budgeting and administration and may be uploaded to HRMS and Payroll for implementation.