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Survey Says Few Employees Understand Employer’s Compensation Policy: A Weekend Roundup

A new survey on compensation from World at Work has revealed a troubling statistic for the HR industry. Most employers, 9 in 10 to be precise, have a compensation policy, but fewer than 50 percent of surveyed companies stated that they believed their employees understand them. This comes as a surprise to some as equal pay has become a nation-wide discussion and brought pay transparency to the national stage with it.

The survey revealed that only 19 percent of employers believe that “most employees understand” the company’s compensation philosophy, and only 3 percent stated “virtually all employees understand it.” This is coupled with another part of the studied, which showed that employers are also, on average, decreasing communications about pay. In 2014, 39 percent of employers shared “minimal pay-related information” compared to 2016 at 46 percent.

Understanding Company Policies the Right Way

So, how can employers increase understanding of their compensation policies? Through clear and efficient communications.

  1. Avoid complicated language. Although these policies are subject to legal considerations, avoid using overly complicated language when explaining policies. Be straightforward and ensure that someone is available to take questions both during the group presentation and individually.
  2. Use a new medium. Try creating infographics or reiterating the policy in a few bullet points through the company internal newsletter. This is a way to explain complex pay philosophies over the course of several weeks to make them more digestible.
  3. Explain more than the straight salary number. Pay also comes in the form of bonuses, vacation, and other benefits. Ensure that employees understand all of the ways they are being compensated. Even more, ensure that they are taking advantage of and using these benefits, such as using all of their available vacation days.


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