Even if salary isn't always an employee's main motivation, it's clear that it's still one of the top three sources of motivation, along with working conditions and personal fulfillment. Implementing an effective salary policy is therefore essential for any company director. But how do you go about it? Here are some explanations.
Why a wage policy?
Given that around 70% of employees resign because they feel they're not paid enough, it's easy to see why you need to take a close look at your pay scale. In fact, if it's set fairly, it will help build staff loyalty and prevent excessive staff turnover.
The same applies tohiring. How many companies are struggling to recruit, as in the catering industry for example? Of course, the arduous nature of the work is also to blame, but it's often the pay on offer that seems too low in relation to employers' requirements.
The question of salaries requires careful consideration. In addition to the costs and time wasted by frequent recruitment and training of new recruits, the company's reputation is at stake. Employees who are satisfied with their employer will speak well of it, and will be keen to convey a good image of their company to the outside world, as well as to its customers.
Paying employees what they're worth, combined with pleasant working conditions, can only be beneficial to the smooth running of a company. Old employees will stay, new talent will be attracted, and productivity will inevitably increase.
Thanks to a motivating salary policy that rewards those who meet or exceed their targets, everyone will want to give their best.
How do you set up a wage policy?
Salary policy is not just about salaries, but also about all the benefits granted to an employee. These include luncheon vouchers, vacation vouchers, discounts for cultural or sporting activities, gift vouchers, company cars and housing, shareholding programs, etc.
It's no longer enough to offer a high salary to satisfy an employee, especially over the long term. It's better to opt for progressive remuneration. Monthly remuneration always includes a fixed amount. Adding a variable component to the fixed salary rewards the employee for his or her efforts and keeps him or her motivated.
Implementing an effective pay policy involves a number of steps:
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Analyze recruitment needs and possibilities: what are the company's skill requirements, and does it have the means to finance them? To find out, you need to call on department heads, who are aware of the needs in the field, as well as financial managers. Hiring ultra-qualified staff, for example, requires a budget to match, as salaries will be high, especially if these experts are also sought after by competitors.
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Define a strategy consistent with the company's overall strategy. What are the priorities? What are the short- and medium-term objectives? In which positions is it best to invest? A company betting on international expansion will be well advised to give priority to hiring bilingual people, and will need to attract them with attractive salaries and career prospects.
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List all professions, then classify each position hierarchically in an organization chart to establish a salary grid. Creating a relevant salary grid is fundamental to managing a salary policy. Once all the job profiles have been determined, you'll need to specify a base salary for each position.
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Determining remuneration levels without forgetting to take into account the company's strategy and financial capacity in terms of room to maneuver.
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Establish a salary range for each level, taking into account the employee's profile (level of education, experience, scarcity of skills, seniority...), the job itself, the degree of responsibility, salary levels among competitors... Remuneration may also depend on the employee's performance against targets. Incentives, bonuses or profit-sharing may also be considered.