Here is the fourth  in a series of short articles addressing some of the more common compensation issues facing HR professionals today.

The fourth of the Five Biggest Mistakes is Poor Pay Delivery.

Direct Deposit?

Poor pay delivery has nothing to do with whether or not you mail checks or use direct deposit.  It has to do with paying people an appropriate wage or salary to keep them productive and engaged in your business.

Companies spend lots of time and money to ensure their pay ranges have the desired relationship to market.  However, having your midpoint dialed in to market does not mean you’re paying properly.

Answer these questions:

Let’s assume that your pay range midpoint represents market.  Now, ask yourself two questions: (1) How long does it take for an employee with the minimum requisite skills to become fully competent in the job?  (2) How long does it take the employee to move from the hiring rate to the range midpoint (market)?  If the two answers differ by more than 12-18 months, you’ve probably got high turnover!

How many employees do you have with good skills (according to your own performance appraisals!) and who are well below your midpoint?  These are the people your competitor will gladly hire if given the opportunity

How to correct this problem?

Budget sufficient dollars so that when an employee can do the job, you can pay them the money!

Next month, we'll focus on mistake #5 - performance management.

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Since 1992, Effective Resources, Inc. has been providing salary, wage, and benefit data for the Tampa Bay Area.  Expanding on that success, the survey has been covering the entire State of Florida for the past five years via their survey website at SalarySurveyOnline.com.  This survey is unlike any other in that it’s put together by compensation professionals with the active support of the HR Florida State Council and its network of thousands of Human Resource professionals.  In other words, it's developed by professionals for professionals. The survey is an invaluable source of information for Florida employers of all locations and sizes, business owners, Human Resource professionals, and educational institutions with graduating seniors.