Compensation After a Pandemic
By Amy Esry, PHR, SHRM-CP
Human Resources Consultant
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Does it seem like the last 14 months lasted about 3 years?†† For many of us, it has felt like that.† Itís been a challenging and stressful time for all of us, in many ways.† But now we find ourselves in springtime.† The Covid 19 vaccine has been out awhile, and many companies are planning for and even moving toward the new normal.† That will mean different things for different companies, whether its customers returning to hospitality venues, or workers returning to an office environment.† Regardless of your industry, as we continue to move through and eventually past the pandemic, our work and how we do things will continue to evolve.
With everything we went through this past year, have you had any time to consider compensation and what it will, or should, look like moving forward? Letís look at a few areas that may impact your organization.
Staffing -† During the pandemic, many employers eliminated positions, reduced headcount, laid people off, or simply had turnover that didnít get replaced.† Hiring may have been frozen, or became increasingly difficult, which means the remaining employees may have had to do more with less help.† This prompts two thoughts.† Are you able to (and should you) reward the remaining employees with a bonus or pay increase?†† Also, if you are hiring again, are your pay ranges where they need to be? In some industries and some locations, finding the talent you need will be challenging and competition for that talent may be high.
Equity- Did some people get hazard pay?†† Have you had to pay more to hire new people?† Did you have a pay freeze and now some people have missed their annual increase?† Not only does your pay need to be competitive with the market, but it should also be equitable internally.†† Nowís the time to take a close look at your pay structure and individual compensation and make any needed adjustments to make sure that your pay structure is equitable and justifiable. †
Remote Work Ė Did some employees relocate because they can now work from anywhere?† Thereís been a lot of talk about how you pay these individuals.† For employees who are no longer in your local employment market will you continue to pay them based on your local market?† Or will you pay based on where they now live?†† Or some other system?††† This is a compelling question, and each organization will need to work out what is best for their company and their workforce.† If you continue to have remote workers, what do you need to do to hire and retain people, now that your employees could literally be anywhere?
Business Outlook and Communication Ė Some industries will see a healthy rebound in 2021.† As people get out and start traveling again, hotels, restaurants, and tourist destinations might all see a much-needed recovery.† Other organizations might still be struggling through 2021.† Help your employees to understand the challenges being faced by the organization, whether you are trying to staff up for a recovery, or still struggling to stay alive.† Transparency regarding the challenges and opportunities faced by the organization, as well as your compensation structure, will go a long way in retaining staff.† With the uncertainty of the past year, your employees are looking for information on the organization, their jobs, and their future.† Being as transparent as possible, even if the news isnít good, builds trust and eases fear.
As we move past the pandemic, now is the time to take a close look at your compensation structure and strategy.† Where do things stand now, and where do they need to be?† Weíve been through a lot this past year and compensation may have not been a high priority.† Itís time to put it back on the priority list so youíre prepared to move your organization forward.