Sam Gee

With the Chartered Institute of Personnel and Development (CIPD) reporting the lowest job satisfaction for over two years in its Spring 2016 employee outlook: employee views on working life report, published in May 2016, it is worth taking a look at the impact of reward. In particular, how smart are you being with the basics?

We know the employee deal is so much more than pay. But pay consistently pops up as a key driver of engagement for a reason. It is not about the amount, it is because pay is all about trust.

When we join an organisation pay is often a negotiation. Both employer and employee have a say. But over the course of an employment relationship, pay is no longer a two-way conversation; it becomes something employers do to employees. So you have to trust your employer to be fair to you, year after year, for the duration of your employment.

Why is this so hard? It is because ‘fair pay’ is subjective and varies from person to person, and from organisation to organisation. The trick is to spell out exactly what fair pay ‘means around here’. If you draw a triangle and label the three points: market rate, internal consistency and performance, can you place an X to show your pay stance? These three principles affect pay in different ways and establishing their relative importance is fundamental.

Being crystal clear on fair pay will help employees understand your reward strategy and sets the principles for robust pay structures. From this, honest conversations about how pay decisions are made can emerge. With three-quarters of employees linking pay transparency to job satisfaction, according to Glassdoor's Global salary transparency survey, published in April 2016, it is certainly worth the effort.

It is not necessarily easy to get this right, particularly in ever-changing and complex organisations, but your employees are trusting you do to this. And it matters to them. A lot.

Samantha Gee is director at Verditer Consulting

Topics