By Alison Hucks from Elite Executive
These are big questions which too often employers don’t think about enough. Budgets are set in advance, new positions might be included, however a budget can’t foresee key personnel’s departures (for whatever reason). So whether filling a newly-created role or an existing position, it’s important for employers to truly think about:
- What salary rate/package will attract the best candidate for the position?
- Will I offer a salary range and be prepared to review the initial salary (& or benefits after a successful probation period or a set review period)?
There is a difference between wages and salaries. Wages are hourly rates for casual, part-time or full-time employees and can be found very easily at the Fair Work website. Salaries are a set amount for work specified or position duties; full time or part-time.
There is disparity in salaries in the market place across the board. Some well-established organisations are paying below market level for employees with little or no rewards, bonuses or incentives and other organisations (both large & small) are paying premium salaries to retain staff with a view to maintaining the knowledge base of their organisation. Other companies are offering base salaries and premium bonuses – rewarding productivity and exceptional performance.
It’s beneficial to establish prior to hiring:
- What can the business afford?
- How will this rate compare with existing staff packages?
- What kind of range can I offer? (what do I as the hiring manager feel comfortable with?)
- What will a potential employee see as a benefit or am I just offering tools of trade?
- If I offer incentives: what will they be and how will I measure performance/results to determine if incentives are to be paid?
You will have a rough idea of what the business can offer from a dollar perspective. It’s a good idea to also have a clear understanding of what the business can offer by way of benefits. Applicants are increasingly seeking jobs and organisations that offer:
- Flexibility in working hours
- 5-6 weeks leave
- Study & training benefits
- Telephone/communication allowances
- and increasingly, health benefits (eg gym memberships or private health care cover).
The standard laptop and mobile phone are no longer seen as benefits, they are seen as tools of trade. So what you mightn’t be able to offer in dollars, you may be able to offer in other ways. It’s important to consider whether what you offer is in line with existing employees, but don’t forget that some employees may wish to have other benefits too!
Market value must also play a role in your decision-making process. Your perspective of what a role is worth may no longer be valid or current. What you may deem as an acceptable remuneration package for an experienced candidate who can hit the ground running (able to produce desired results in a short time frame), may equate to the value of an average candidate with limited experience.
Candidates are increasingly focusing on ‘WIFM’ (What’s In It For Me) when viewing their current and future employment options. Poor leadership, lack of management support, non-implementation of company values and broken promises (vis a vis career pathing or reward programs) are prime reasons given for employees seeking alternative employment. The lure of more money can be a secondary reason.
Businesses must keep wages down in order to survive to pay for ever increasing taxes, insurances etc in order to employ people. Tax breaks and incentives would assist in this area but until that day other ways of ‘win/win’ packaging must be considered.
When it comes to recruitment, you are acquiring your greatest asset – it’s important that you dedicate the time to doing your due diligence and this is where you need to turn to the experts in this field, Elite Executive – we are not just your recruitment specialists, we are your recruitment partners.