Technology in Total Rewards

Compensation Planning

Online compensation solutions offer an excellent platform to replace spreadsheet administration. Employers now have greater ability to trend salaries, reduce repetitive calculations, and produce reports. Online platforms allow information to be delivered in a timely manner to Human Resources or management staff and can go beyond storing salary history reports. Technology can provide online versions of:

• employment agreements which may contain key elements of compensation.
• salary rates for each employee
• data on salary increases both on an individual, department and overall trend basis
• compensation market data
• pay grades and job hierarchy
• budgeting and modeling

Online Market Data

Online market data is readily available for developing an annual salary plan. Current market data can easily be accessed via an online platform. Some salary planning platforms now utilize predictive AI along with regression analysis to enhance their capability to trend market data. AI may also be used to write job descriptions, generate pay grades, and run automatic analyses to report on such things as an organization’s pay equity compliance.

Example of benchmark salary data:

When evaluating a supplier of compensation data, the following features or attributes should be evaluated:

• geographic specific salary data
• jobs in the data set
• industry cut of salary data
• base pay and total cash compensation
• data by revenue size or number of employees
• data that reflects years of experience or job level
• the capability to trend data
• reliability statistics
• source data
• a full statistical methodology

In today's competitive market, it is more important than ever for employers to have current compensation information when developing the annual salary plan to attract, hire and retain an engaged workforce.

Some platforms go beyond providing just salary data. They may also provide compensation planning tools that include analyzing pay equity, managing pay grades, keeping track of salary increases and different types of incentives, and a profile of each employee that includes their pay grade, incentives, automatic adjustments to their pay compa-ratio or market index status, and their benefits.

Example of employee profile with analysis tools:

Example of pay grade structure management with AI enhancement: