Getting started with Salary Benchmarking

Salary benchmarking is a crucial process for ensuring your compensation strategy remains competitive and fair. This guide will walk you through how to effectively use our platform's benchmarking features to make informed decisions about your organization's compensation structure.

Understanding Salary Benchmarking

Salary benchmarking allows you to compare your organization's compensation packages against industry standards and market rates. This comparison helps you:

• Identify whether your compensation is competitive in the current market
• Detect potential pay gaps or inequities within your organization
• Make data-driven decisions about salary adjustments and budget planning
• Attract and retain talent with fair and competitive compensation packages

Accessing Benchmarking Data

To begin using our salary benchmarking tools:

1. Upload your HR Data using our spreadsheet template to import your existing compensation data
2. Select Benchmarks from the left navigation
3. Click New to start searching and saving data to your new benchmark, collecting the evidence you need to select the most relevant and credible range
4. Select the row, click the menu and select 'Apply' to create your Benchmark Range
5. Select Individuals from the left navigation
6. Select the staff and assign them to your new Benchmark.

Key Benchmarking Metrics

Our platform provides several important metrics to help you understand your compensation position. Benchmark data is typically organized by percentiles that show how salaries are distributed across the market:

• Low - 25th Percentile: The lower end of the market rate (25% of companies pay at or below this level)
• Mid - 50th Percentile/Median: The middle market rate (represents the typical salary for the role)
• High - 75th Percentile: The higher end of the market rate (75% of companies pay at or below this level)

Understanding these percentiles helps you determine where you want to position your compensation strategy relative to the market.

Identifying Risk Areas

Once you have mapped and refined your benchmarks, use our analytics to quickly identify potential compensation issues:

1. Look for red flags where your compensation falls significantly below market rates
2. Identify positions with high turnover risk due to below-market compensation
3. Discover departments where compensation may be inconsistent with internal or external benchmarks
4. Detect potential equity issues across different employee groups

Taking Action with Benchmark Data

After analyzing your benchmarking data:

1. Prioritize adjustments for positions that show the highest deviation from market rates
2. Develop a phased approach to address compensation gaps if budget constraints exist
3. Create compensation bands based on benchmark data to guide future hiring and promotion decisions
4. Document your compensation strategy using benchmark data as supporting evidence
5. Schedule regular reviews of benchmark data to keep your compensation strategy current

By regularly utilizing our salary benchmarking tools, you'll be equipped to make strategic decisions that help attract and retain talent while ensuring your compensation spend is optimized for your organization's needs.