At Reynolds + Rowella we are often approached by current and prospective clients to conduct compensation benchmarking to determine a proper salary range for employees.
What is Compensation Benchmarking?
Compensation Benchmarking is the comparison of internal jobs to the market. We take your job descriptions and match them to similar jobs found in multiple compensation surveys to identify the external worth or market rate. In other words, you will know what other companies in your industry, geographic location and size category are paying their employees for similar jobs. Along with the knowledge you have about the internal worth of your organization’s positions, the external market data will help you ensure you are paying your employees competitively.
Why is compensation benchmarking important as a “best practice”?
Establishing market rates for core positions within an organization is important for a variety of reasons. First and foremost, it guides pay decision-making including hiring, promotions, internal equity salary adjustments, and general compensation budget planning. Because labor costs are the largest cost to any organization, a solid understanding of the external value of each position allows an organization to develop an approach for setting overall total rewards philosophy, or the level at which the organization will set salary levels. The ability to balance the needs to attracting and retaining talent with fiscal responsibility of the organization is a key priority for executives. Compensation benchmarking provides business leaders the information needed to define the costs associated with salaries and other compensation components such as profit sharing or bonuses.
How we can help
Reynolds + Rowella has the expertise necessary to provide you with compensation services to ensure your positions are documented and benchmarked with the external market accurately.
Once you have the market data, we will also help you determine what to do with it. This includes an employee analysis identifying which employees are below or above market and what it would cost to bring them to market. We also give recommendations and guidance on next steps and how to effectively communicate changes to your employees.
A benchmarking and analysis done well can help you control costs, mitigate legal risks by providing structure to ensure internal equity and maintain market competitiveness, and enable your organization to attract, motivate, and retain talent.
Contact Katie Hall katieh@reynoldsrowella.com 203-438-0161 to learn more about the benefits of compensation benchmarking.
REYNOLDS & ROWELLA | ACCOUNTING AND CONSULTING FAIRFIELD COUNTY CT
Reynolds + Rowella is a regional accounting firm known for a team approach to financial problem solving. As Certified Public Accountants, our partners foster a personal touch with our clients. As members of DFK International/USA, an association of accountants and advisors, our professional network is international, yet many of our clients have known us for years through the local communities we serve.
Our mission is to operate as a financial services firm of outstanding quality. Our efforts are directed at serving our clients in the most efficient and responsive manner possible, delivering services that exceed the expectations of those we serve.
The firm has offices at 90 Grove St., Ridgefield, Conn., and 51 Locust Ave., New Canaan, Conn. For more information, give us a call at 203.438.0161 or email us.
