These Will Make You Go "Hmm": Great HR Posts

There is a ton of stuff in the blogsphere to read. There is NO way you can keep up on it all and get your job done. So that is why I try to help and pass on to you some great things I read. Here is a list of posts that will make you think. And who knows you may learn something in the process.

• First up is The Employee With The Achilles Heel written by Kimberly D. Urban at her blog site Kim's HR Potpourri. This post is one that all of us can identify with. My story was similar to hers. Great employee who could not make it to work.
• Next up is What If We Kill Incentives? Laura Schroeder, writing at the Compensation Cafe, discusses what has to be in place if we take away monetary incentives. Her real-life example comes from time spent in Russia.
• Some of you have probably seen the NLRB activity on employee Facebook activity. I have even considered writing on it myself. I may no after having seen Jon Hyman's post WIRTW #152. It is his usual collection of excellent articles, but the first group focuses on Facebook Firing. So if  you want to be caught up on this controversy read this series. It DOES HAVE AN IMPACT ON YOU! Ignore it to your own peril.
• Another selection from the Compensation Cafe is on The Importance of "Why" written by Derek Irvine. Derek talks about the importance of meaning and purpose on the job.
• Lastly, there is the entire series of posts offering strategic advice to SHRM and how things can be improved for the association and the profession. This is found at Voice of HR. My reaction to most of these posts has been "Damn, I wish I had written that!" (I did write a post as well, though it has not yet been published. But it will pale in comparison to most of these.)

So there is your list of thought provoking, stimulating stuff to read today or this weekend. I will defy you to tell me these did not make you go "HMMM".

Carnival of HR The Humor at Work Edition

Drew Tarvin, who is a humor consultant (yep, that is a real job) is the host of this early August issue of the Carnival of HR. There is quite a collection of blog posts, some dealing with humor, some not. (Mine doesn't.) Here is a sample:

• Become Unnoticeable to Be Noticed – Getting noticed in the corporate world means doing the “non-sexy” work exceptionally well.
• Don’t Pick My Pocket Just Because I’m Female – Wo(ah)man, that’s not right–even in female dominated professions men are still paid disproportionately more money.
• Everyone has their own Trevor – Why “your cat not letting you do your work” is no longer a good excuse.
• Five Ways to Disarm an Angry Mob – AKA delivering not-necessarily-happy news. Does not cover how to create the angry mob.
• Getting the Most Out of International Assignments – Improving the value of international assignments regardless of currency, except Monopoly money.

And much, much more. The Carnival can be found at Carnival of HR: Humor at Work Edition so check it out and do some learning.

Hey, you might even find a chuckle or two....

Highlights in Compensation Thought: Featuring The Compensation Cafe

Because I am a generalist by training and trade I have to work at keeping up on what is happening in compensation. I do so by reading one of my favorite blogs called Compensation Cafe. Created by Ann Bares, who also writes a personal comp blog called Compensation Force, it is a collection of posts from a team of experience compensation pros that Ann has enlisted to write on compensation topics. (Compensation Force is also published in Workforce Magazine's online issue.)

While consistently good, lately there have been a couple of posts that are outstanding and I wanted to highlight a few of them.

First up is 77 Cents and Gender Discrimination: The Wrong Conclusion written by Stephanie R. Thomas. This is the best explanation of the wage gap between men and women that I have ever read. In my opinion this one blog post should be considered required reading, NOW, for all human resources professionals. Current legislation may be passed on the basis of what turns out to be an incorrect interpretation of data presented a 2007 article. In the classes I teach I often address the wage gap and mention that there are many factors that go into that gap beyond discrimination. This article gives me more concrete information to use in that discussion. By Stephanie's review of the data it shows that the vast majority of the wage gap does NOT occur due to discrimination. However, the current proponents of the Paycheck Fairness Act would lead you to believe otherwise. Because this is an issue of immediate importance EVERY HR PRO needs to be well versed in this subject and needs to read this post NOW.

The second post I wanted to highlight is one written by Ann Bares herself. It is called Salary Ranges Must Die ... and be Reborn. It is an excellent explanation of how the age old concept of salary ranges and budgeted increases no longer works in world of talent management. I have long had a problem with pay-for-performance being restricted by wage increase budgets. I am looking forward to Ann developing her concept to a greater extent. But I would check it out.

The third post I wanted to highlight is sandwiched in between the above two. Written by Laura Schroeder, Total Rewards Gurus - Where Are You?, the post discusses the relationship of non-cash incentives and employee engagement and how that fits into a total reward system. Ms. Schroeder wonders aloud why compensation specialist are not leading the charge in arena. The mix in any total reward system is important and research indicates that perhaps now is the time to change the mix. Interesting work.

So there you have it. Three great pieces to educate the rest of us "compensation dummies". Check them out and put them on your reading list.

Five Great Blog Posts to Read for MidWeek

If you are like me you get a ton of things to read. Sometimes it is just INFORMATION OVERLOAD! That is why I like to have colleagues point me to great posts and articles to read. (A good use for Twitter, btw.) So I figured I would do the same for you. Here are five great blog posts that I think you will find useful and informative.

1. Margaret O'Hanlon, over at Compensation Cafe writes on You've Got Lemons...Time for Lemonade. This is a great take on learning and growing and employee engagement.
2. Ann Bares, at Compensation Force gives us a reminder lesson on The Perils of Setting Incentive Plan Targets: Revisiting Some Rules of Thumb. In these turbulent times having some guidance on what to do in the compensation arena is always a good thing.
3. Jon Hyman, at The Ohio Employer's Law Blog, provides us with some advice on what to do when the boss is the sexual harasser in What do you do when the boss is accused of harassment?
   Don't try to pretend you haven't thought of it... so take this advice.
4. Sharlyn Lauby, The HR Bartender, talks about how Being Selfish is Good for Your Career. Tell me that doesn't grab your attention.
5. David Zinger, at David Zinger Employee Engagement, has a great formula for employee engagement, Just Add Spinach

Ok, there you go. I have given you 5 great reads that will make you a much better HR professional or business manager than you were before you started reading this. Get to it!

Four Blog Posts You Need To Read Immediately if You Are In HR

Here are four great blog posts with some terrific information that all HR pros need to read. The posts will speak for themselves. Good reading by some great bloggers.

Do you know? DOL to require “compliance plans” by Jon Hyman

On the Upsides & Downsides of Proactive Pay Audits by Ann Bares


The Real Reason for Exit Interviews by Sharlyn Lauby


How to lose a good employee in under five steps by April Dowling

Required Reading for the Week

There are several blog posts this week that are essential reading for anyone who calls themselves an HR Pro. These include:

1. Kris Dunn at the HR Capitalist writing on What's That Smell? Self Assessments & Performance Management. This is about performance management and the use of self assessment. In addition to his post you MUST READ ALL THE COMMENTS. There is true value in this feedback.
2. Margaret O'Hanlon at Compensation Cafe, writing on 10 Tools for Communicating a Teeny, Tiny Merit Increase Budget. She talks about clear communication and management training.
3. Ann Bares at Compensation Force writing on Think Twice Before Calling It a Cost of Living Increase. Read this to keep from making a major mistake.
4. Jon Hyman at the Ohio Employment Law Blog writing on Is “fat” the new protected class? Jon provides some important information to go along with my post on Fatism.
5. Dan McCarthy at Great Leadership, writing on MBA 2.0: Trading in Textbooks for Blogs? This post explains how blog posts have become a vital source for keeping yourself educated. 

So read away. Be educated. Be a pro!

Follow Up on Non-Discretionary Bonuses

In my post yesterday, Getting Punished for Doing Good, about QuikTrip's fine at the hands of the USDOL for not calculating non-discretionary bonus into overtime for nonexempt employees I was asked on Twitter if that included non-cash bonuses. Well I was not sure, though I suspected it might if it was production related. So I asked around. Good blog friend Ann Bares pointed me in a couple of directions and I also asked, via Twitter. two attorneys, Eric B. Meyer and Jon Hyman. Both replied that the answer was a resounding YES! I was pointed to the following fact sheet from the US Department of Labor, Fact Sheet #23, which clearly states on page 2 "Where non-cash payments are made to employees in the form of goods or facilities, the reasonable cost to the employer or fair value of such goods or facilities must be included in the regular rate."

So clearly, if you are giving non-discretionary bonuses based upon production standards, the amount of the bonuses or the value of the award must be added to the base pay rate of the employee and then overtime must be calculated on this amount. If you fail to do so you run the risk of falling into the same trap that caught QuikTrip and many others. Go back and read the comments from yesterday, they are very informative.

As additional resources on this topic see also Ann Bares post on Compensation Force entitled
Know Ye the Regs When Awarding Bonuses or Lump Sums to Nonexempts and Michael Moore's post entitled Bonus and other Lump Sum Payments to Nonexempt Employees may Impact Overtime Calculations . Both are very informative.

Now you have no excuse for making this mistake and you can make yourself an HR HERO in your company.

Getting Punished for Trying to do Good: The Lesson in the Quik Trip Fine

QuikTrip, a Tulsa, Oklahoma based convenience store chain, has agreed to pay out $750,000 in overtime payments that the U.S. DOL said were due employees because of a violation of the Fair Labor Standards Act. By just looking at the headline you might think this is the "standard" case of a company working employees off the clock or not counting time they worked. Well if you thought that you would be very wrong. This case has to do with a company trying to do good things for their employees and rewarding them for their good work.

QuikTrip has a bonus system based upon a secret shopper program. Employees are rewarded for extra good work based upon their ratings in the program. What an excellent thing to do! However, QuikTrip got caught in a making a mistake that many companies probably don't even realize they could make too. In fact when I talk about this in the SHRM prep classes I teach most people are agast. The mistake that QuikTrip made was in giving nonexempt employees non-discretionary bonuses! Because if you give nonexempt employees non-discretionary bonuses you have to use that in your overtime calculation for the period of time that was covered by the bonus.

This 2003 article, entitled Intersection of Bonuses and FLSA - Is More Overtime Pay Due?, written by Jason Reisman of the law firm Obermayer Rebman Maxwell & Hippel, explains that "The FLSA requires that non-discretionary bonuses - those promised to employees - be allocated over the time period to which they apply and included in calculating the overtime pay due to non-exempt employees. Such a bonus, viewed under the FLSA as additional compensation for employees' work, requires additional overtime pay beyond the employees' regular overtime pay rate, which is one and one-half times their regular hourly rate of pay. Non-discretionary bonuses that are not paid on a weekly basis require allocation to each workweek covered by the bonus before recalculating the overtime compensation due. Generally, non-discretionary bonuses include attendance bonuses, individual or group production bonuses, bonuses for quality and accuracy of work, and retention bonuses." (For further information click on the link above.)

Discretionary bonuses do not require such payment, but may have consequences beyond just the simple payment of the bonus. To avoid problems Reisman suggests either of the following in constructing a bonus program for nonexempt employees.

1. True discretion - both the language of the bonus plan and the actual administration of the plan must demonstrate "discretion."
   


2. A percentage of total earnings (both straight time and overtime) payout. As to the latter option, instead of a lump sum payment, the FLSA authorizes employers to pay a "percentage bonus" because it automatically includes an allowance for overtime pay as well as for straight time pay. The percentage bonus tool can be a silver bullet to effect compliance with the FLSA overtime provisions, while leaving intact the non-discretionary format of the bonus. However, a percentage bonus still requires advance planning, as it may have associated side effects, such as causing the employer to make different bonus payouts for similarly situated employees who earn different amounts of money, by virtue of different pay rates or working different hours.
   

Or you just don't pay ANY bonuses to nonexempt employees! Overtime problem solved! But wait that certainly does not get you in the direction you want to go in with having committed employees whom you want to reward for helping the company be successful. So careful design and understanding and guidance needs to go into each bonus program you design. Realize the cost of the bonus is going to be greater than the actual bonus designation. And if you don't have someone on your HR staff qualified to do this then get a good compensation consultant to help you. It will be a whole lot cheaper than paying $750,000 in back pay. QuikTrip got burned trying to do something good you need to avoid the same happening to you.

I would like for some of my compensation buddies to weigh in on this and perhaps offer some additional advice. Ann? Phil? Folks at Compensation Cafe?

Women's Issues: Communication, the C-Suite and Compensation

I received a newsletter the other day called Communicator's Corner, written by Sally L. Williamson. Her newsletter was entitled "WHEN THE BEST INTENTIONS LEAD TO WRONG IMPRESSIONS". (Sorry no link) In the article she makes the statement "By 2016, women are projected to receive over 60% of bachelor's degrees, 61% of master's degrees and over 53% of all doctorate and professional degrees.* The Department of Education says that women have been earning more degrees than men for over 28 years. And yet, the studies prove that women still aren't moving up the corporate structure very quickly. Last year, Catalyst updated their statistics regarding women who sit on Fortune 500 Boards and found that the percentage (less than 15%) is simply not changing." Ms. Williamson then goes on to make several observations on common impressions on why this may be occurring. These include:

• Impression #1: A Woman Can Do Everything. There is evidence in both personal and professional lives that women can multi-task better than most men. Womea are as frustrated with their workloads and somewhere along the line sense that they need to do it all to get ahead. Men who typically learn to do a few things very well, rather than trying to do everything. Managers are often unsure of what to do with someone who insists on taking on every task. And, in fact, it doesn't take long before this good intention can turn into the impression of someone who can't delegate or who doesn't manage others well. Women who try to do everything can get left behind doing all of the little things, rather than running the big initiatives.
  
  Williamson's Coaching Note: Women need to hone their skills and excel at something specific, not everything. It's hard to quantify the impact on a department or project if you've done a little of everything. Instead, if you've focused on one project and managed it from start to finish, it's easier to align yourself with success.
  


• Impression #2: Let's Discuss! Women frequently approach business situations with a desire to talk it through and debate all of the ideas and options, which can translate to "She talks too much." Williamson is convinced that women think out loud and men really don't! Women who get bogged down in the details by their desire to talk things out can get alienated by male counterparts.
  
  Williamson's Coaching Note: The ability to talk things out is a trait that women actually use to their advantage when they are in roles to facilitate or lead discussions. But, it's important to learn how to read an audience by listening first. Women need to listen first and speak last; it isn't always necessary to be heard on every topic. Your presence and non-verbal reactions often say more than your words.
  
• Impression #3: I'm Tough as Nails. Often, women feel as though they have to be aggressive with their communication in the workplace in order to get ahead and be heard. Women have always been told "Don't let anyone step all over you, speak up for yourself." (My comment: Probably by other women and well meaning fathers.) I know that I've experienced that in my own career, so I'm guessing others have, as well. When a woman thinks she is being assertive, at times, it can be perceived as "She's so negative and fights everything." Sometimes, women put on boxing gloves to defend an idea without even realizing that we've stepped into the ring. Men rarely challenge ideas in meetings; they tend to take debates out into the hall. When companies want fighters, they promote the football all-star or the Navy Seal. Companies tend to promote women to bring intuitive skills and warmth to a team.
  
  Williamson's Coaching Note: Aggressiveness is not a trait that most people like and it's important for women to understand when they are fighting or pushing others away with their communication style. Williamson finds that women don't even realize that they're being viewed this way. By becoming more aware of these types of impressions, women gain credibility when they simply own who they have become and project a sense of confidence about what they can achieve - all before saying a word.
  
  Williamson concludes "Management consultants have said for years that women have natural nurturing traits that make them effective as communicators and team leaders. But, the statistics above make it clear; it's still a challenge for women to get leadership roles. Becoming aware of how good intentions can lead to wrong impressions will help women make different choices in how they communicate."

Some very good observations. Check out her site, SW&A for more information.

Along these same lines, with all the education women have today you would think we would be seeing an increase in the wages that are being paid. After all more and more women are in HR and should be able to assert some influence on "fair wages." But the increases don't seem to be coming. An alternative explanation was written about over at the Compensation Cafe by Becky Regan in her blog post Could It Simply Be Motherhood? : A Contrarian Rationale For Gender Pay Equity. This is a post that might stir up some conversation. Check it out.

Zappos Is Very Interesting From an HR View

The May 2009 issue of Inc. Magazine has Tony Hsieh (pronounce Shay) on the cover. Apparently Mr. Hsieh is a favorite of Inc. because searching on their site produces 216 or so articles written on him in the past 5+ years. And I have heard of Zappos, but never really paid attention to them. (In fact I must confess that I thought they were a brand of shoe rather than an online retailer of a multitude of shoes.) This time however, I took time to read the article on him and Zappos. So here is my "Johnny-come-lately" HR view of some of the things that Zappos has done and currently does.

Tony Hsieh runs his company by going against much conventional wisdom. Zappos has a quirky culture that encourages alot of individuality. The interview process starts off with cultural fit questions in an hour long interview. Questions include "On a scale of 1-10, how weird are you?" Apparently you have to be sufficiently weird to work at Zappos. After that you go to the department that is interested in hiring you. Disputes between HR and the department are decided by Hsieh himself.

The company provides alot of training for both new hires and current employees. That is not all that unusual, but what distinguishes Zappos is that, for new hires, after two weeks of training and two weeks on the job the employees are offered $2000 to quit. Yes quit! This lets the company keep people who are committed and get rid of the ones not suited to the culture or the job. The company actually found that this is a cheaper way than retaining non-productive employees and then terminating them for performance later. I really like this idea, and may think of clients that this may work for as a solution to turnover.

Each employee contributes to a "culture" book. And with more than 1500 employees the book has grown quite large. But all employees have a "piece" of the company that way. I like that too.

A last anti-conventional wisdom point is that the company does not pay the highest wages out there, in fact somewhat lower than other companies may pay. But to help offset this the company moved from San Francisco, with its high cost of living and high tax rate, to Henderson, Nevada (Las Vegas area) where there are no taxes and a lower cost of living. Additionally, Hsieh wanted a place where bars and restaurants were open 24 hours so that late working employees would have places to unwind after work. Pretty employee-friendly thinking.

Hsieh is very concerned with happiness. In fact he is doing a current study on happiness. This concern seems to show in his treatment of employees.

So I encourage you to pick up this month's Inc. and read the article (or wait until next year and you can read it at your doctor's office). Tony Hsieh and Zappos.com is a very interesting study. I may even buy some shoes from them, though the pair I wanted was not available when I checked. Oh well.

Let Me Introduce a New Blog on Compensation

An associate of mine has joined the blogsphere. Phil Blount and his associate Barbara Mackintosh are the main players in Phillip Blount & Associates, a compensation and human resources consulting firm located in Atlanta. Their new blog leads off with an explanation of the Lily Ledbetter Fair Pay Act. It is a great explanation and offers a pay-for-performance solution to dealing with the requirements of the act. So give them a visit and add them to your list of excellent comp blogs, right along side Ann Bares' Compensation Force.

April 15th Carnival of Human Resources

Chris Young hosts the April 15th version of the Carnival of Human Resources at his blog Maximize Possibility. Some of the great articles there include:

• Ann Bares, Compensation Force - For Strategic Rewards, There Must First be a Strategy
  
• Anna Farmery, The Engaging Brand - 10 Lessons for Life
  


• Susan Heathfield, About Human Resources - Company Layoff Practices Matter: They'll Remember How They Feel
  


• HR Minion - It's Called Due Diligence
  


• HR Bartender - HR's Moment of Truth
  


• Wally Bock, Three Star Leadership - Leaders Decide, Let Them Learn How
  


• Dan McCarthy, Great Leadership - Moon Shots for Management: Management 2.0


• And others, including yours truly.

Check it out for a wealth of knowledge in one small place.

Watch Out Compensation Specialists: Your Jobs Are On The Way Out

On March 29th, on Meet the Press, Treasury Secretary Timothy Geithner appeared and answered questions about the current economic crisis. He made one interesting comment that I think does not match the motivations of most of the people I know. He said "But we're going to emerge stronger than this. When we get through this people are going to care less about what they make, more about what they do, what they achieve with what they make, and that will help make this country stronger." Click here for the transcript.

So we are going to care less about what we make! Well all my comp friends, Ann and Frank and Phil and Barbara, you had better start looking for another line of work. Compensation will be unimportant. Find something you like to do. Find something that will make the country stronger. Hmmm.... know how to handle a shovel?

March Madness Comes to the Carnival of HR

The Carnival of HR is visited by March Madness. It is a tournament of the best of HR blogs. Take a look and vote for the "teams" you find the most interesting. This is a unique way of reading the best and expressing an opinion at the same time. Of course I would like you to vote for me, but I will leave that to your discretion. So go visit March Madness.

Merit Pay Going the Way of the Dinosaur: Fallout From Ledbetter

A SHRM alert I received today had this quote in it: "Camille Olson, an attorney at Seyfarth Shaw in Chicago, said that some HR executives have wanted to revisit their companies’ entire pay systems as a result of the new law. Here’s why: An annual pay increase based on merit has a life under the new law until the employee no longer receives a paycheck, she explained." The article went on to discuss alternative methods of paying people as a way to people because of the passage of the Ledbetter Fair Pay Act. Included in these was " Employers might instead adopt policies awarding pay based on objective factors such as job title and years of service, she noted. Employers would pay employees a certain amount, and everyone would get the same percentage increase. " This will certainly eliminate individual merit increases.

An alternative suggestion was “A lot of HR executives are asking me if they should move from performance-related increases to lump-sum payments” so that pay won’t have a continuing effect, she remarked. The merit portion of this compensation scheme would result in bonus payments but not increases in base salaries." This suggestion certainly keeps merit in the pay system, but will require a large attitude change in how compensation is seen, by both employers and employees. Who knows it may open the door to putting everyone on a system of having a significant percentage of compensation "at-risk."

Either way, it appears that merit increases of base wages will be going the way of the dinosaur. What do you think?

Performance Appraisal: How Often Is Enough?

I am often asked how often a manager should give an employee a performance appraisal. My response? All the time! To my way of thinking the job of a manager is to pay attention to an employee's behavior and performance on a consistent basis and to correct as needed and to praise when appropriate. Unfortunately that seldom happens. Many managers let employees go, waiting for the "annual" performance evaluation. Managers who have been trained, mentored or who have a good manager will handle situations as needed. They realize that if you want the behavior and performance you require for success in the job it has to be reinforced on a consistent basis.

Now when there is behavior that needs to be corrected it definitely needs to be documented and the rules need to be followed. However, even this has to be done at the time and not wait until an official performance review.

Do we need to have OFFICIAL review sessions. Yes, there needs to be a paper trail tied to compensation. Should it be annual? Every six months? Well that answer depends on how often your system and budget allow for compensation changes. This however, should not be the first time all year that the manager has ever said anything about the employee's performance, good or bad. If it is then shame on that manager. That session should be a review of all the previous discussion and to make sure that discussed corrections have been made. It should be an opportunity to plan what needs to be done in the coming year and what goals need to be set. How you tie it to compensation depends on budget and how your culture works.

One thing is clear. There should be NO surprises at all! Both parties should walk into that session knowing exactly how things are going to go.

Do I think this type of performance management occurs in the real world? Not too often would be my guess. What about you? Does it work this way for you? Do you have some good examples?

Carinval of HR #34: All the Best HR in One Place

The Carnival of HR #34 has been published on the Pennsylvania Labor & Employment Blog. This is a collection of the BEST in HR blogs, so nose around and get in some good reading.

FREE Salary Data, No Strings Attached: What a Deal!

Ann Bares had a great post yesterday at her blog Compensation Force. She posted the U.S. DOL Bureau of Labor Statistics' report on the May 2007 Metropolitan and Nonmetropolitan Area Occupational Employment and Wage Estimates.

As Anne states "This is essentially a free salary survey, and one which I have found it to be a good supplemental source of data. My experience is that it syncs up well with other sources that cost me a lot of money, and it has the additional benefit of covering metro areas and occupations that are not well covered by other professionally published compensation surveys."

So check out the report and bookmark it for future use. And, by the way, if you are involved in compensation and you are not reading Ann's blog on a daily basis (or whenever she posts) then shame on you because you are ignoring a wonderful resource.

Environmental Scanning: Some Great Reads on HR

As I was catching up on some reading, after having been on a trip to California, I wanted to point out to you some great reads and some new materials for you, especially if you are involved in recruiting.

Kris Dunn of The HR Capitalist has started another blog on recruiting called Fistful of Talent. It is a multi-author blog that will feature many different takes on recruiting. Today's is about the appearance of applicants today. Oh, The HR Capitalist (see link above) is about whether HR can be trusted or not. So check it out.

Jim Stroud, of the Recruiters Lounge has a FREE BOOK entitled Resume Forensics that you can download for FREE. It talks about resources and tips for finding resumes and candidates using search engines. Valuable stuff.

Ann Bares, of Compensation Force has a post today about The Quiet Pink Pay Revolution, women gaining on men in the workforce. Very interesting.

Penelope Trunk, The Brazen Careerist, talks about what knowing what you should be doing by what you did as a kid. A thought provoker.

Tomorrow I will blog about the SECRET union conspiracies under way with some companies, so stay tuned.

Pricing and Geography: A More Effective Method of Pricing Jobs

Ann Bares, at her blog Compensation Force, has a great post about pricing jobs in different geographical locations. This is an issue that many an HR person has struggled with if they have multiple locations. Two people doing the same job, requiring the same skill level, however, they are located in two different geographical areas, of which one is more expensive to live in than the other. When this happens there is pressure to pay the one more than the other. And the basis that is often used is Cost-of-Living.

Ann suggests that rather than using cost-of-living it would be more effective to use cost-of-labor as the more appropriate measure. She gives several examples of places that have high cost-of-living indexes but lower cost-of-labor indexes. So check out her blog, by clicking the link above, and get a better understanding of this effective way of pricing a job.