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Communicate: Perception is reality. Be transparent: Don't try to hide what employees make. Make a comparative within each salary grade by the employee's tenure in the position. Compare supervisors' salaries to their direct reports' salaries.
Pay compression can cause problems for employers. Pay compression can also hamper recruiting efforts. This happens when there is a disconnect in the organization about what the appropriate pay rates for a given level of experience might be versus what the market is really paying.
Pay compression is the situation that occurs when there is only a small difference in pay between employees regardless of their skills or experience. Pay compression is the result of the market-rate for a given job outpacing the increases historically given by the organization to high tenure employees.
Communicate: Perception is reality. Be transparent: Don't try to hide what employees make. Make a comparative within each salary grade by the employee's tenure in the position. Compare supervisors' salaries to their direct reports' salaries.
Pay compression is a compensation issue that develops over time. Also referred to as wage or salary compression, it occurs when there's little difference in pay between employees regardless of differences in their respective knowledge, skills, experience or abilities.
There is another form of salary compression: when employees in lower-level jobs are paid almost as much as their colleagues in higher-level jobs, including managerial positions. Moreover, while salary compression is not illegal, it is often accompanied by pay inequities that could violate equal pay laws.
Pay compression, also known as wage compression or salary compression, occurs when employees with the same skills and experience are paid differently. In highly skilled job families and departments with deep employee tenure, this can sometimes occur when employee salaries rise above those of low-level managers.
Pay compression is the situation that occurs when there is only a small difference in pay between employees regardless of their skills or experience. Pay compression is the result of the market-rate for a given job outpacing the increases historically given by the organization to high tenure employees.
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