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HR Insights – Detry Carragher, CPHR (Carvo Group)
How does my employer determine my pay?
I can still hear the echoes of Tom Cruise shouting out ‘show me the money’ from the 1996 movie Jerry Maguire or Dolly Parton singing her lively 1980’s song ‘Working 9 to 5.’ We all need money to provide the essentials for things such as food, shelter, and clothing.
One of the biggest challenges for an employer is determining the right amount of pay. Compensation (or pay) strategies will vary, and as this topic is rather complex I’ll aim to provide you with a few insights as a starting point only.
How does my employer decide how much I should get paid?
Employers typically consider some, or all, of these factors in designing their pay structures:
- At minimum, they must ensure they are complying with government regulations such as the Employment Standards Act (for provincially regulated employers) and the Canadian Labour Code (federally regulated employers). PEI currently has the highest minimum wage in Atlantic Canada, at $11 per hour.
- They examine the availability of workers with the required skills and analyze what other companies pay for similar jobs. The purpose is to examine the external labour market to determine a “competitive set.” Based on these factors, the company will choose to pay higher, lower, or the same amount for the position. This typically only takes into consideration base pay and excludes other forms of possible compensation such as bonuses, shares, and benefits.
- They base compensation according to a prescribed classification system. Classifications are based on detailed job evaluations to determine the value of a job. Larger organizations, and often unionized workplaces, will adhere to a classification system to determine pay.
- They will assess their organization’s future plans, the performance of the organization, the reputation of the organization, geography, and additional benefits.
- And finally, great companies ensure their compensation is internally equitable, fair, and free from discrimination (such as age, gender, race, and disability).
Determining an employee’s compensation is not a simple task. It is equally important for you to understand the value of your skills so you can participate in the conversation with your employer. Better workplaces are a shared responsibility!
About Detry Carragher
As a Chartered Professional in Human Resources (CPHR), Detry Carragher has led Carvo Group since 2004. The team is consulted regularly by employers, industry groups, and employees from across Atlantic Canada on a range of employment-related topics. Detry’s work extends to several of Canada’s Top 100 Employers and Fortune 500 technology companies, and she has contributed her insights on CBC, CTV, and the national HR Reporter publication. Detry was recently awarded the prestigious HR Award of Excellence, representing Nova Scotia and Prince Edward Island.
She has offered to share her HR insights with Employment Journey readers. Read more here.
If you have a specific question you would like featured in the HR Insights column, or you are interested in expanding your skills in human resources, email [email protected]. Visit www.carvogroup.com.
A fresh start
The holidays are over and it’s time to set a plan in place to make 2017 your best year yet. To help you on your career journey, it is the intent of these monthly HR Insight columns to share answers to common employee questions I have received over the past 20 years as a Human Resources Management professional.
Most individuals spend 2,000+ hours at work each year. Every employee desires a great place to work, and everyone can help make it great.
What can you do to create a great workplace culture?
- Remember what attracted you to your current position. Find ways to advance your occupational interests.
- Focus on your work performance rather than the work habits of others. Committing to a results-oriented approach leads to a fulfilled and purposeful career.
- Establish amicable relationships with other employees by being respectful of individual differences and personality styles. Gossip is the biggest culprit in a toxic workplace.
- Embrace changes in your job as an opportunity to learn and grow.
- Find ways to support upper-level decisions rather than criticizing or complaining. Put positive energy into areas you can influence and control to the betterment of the company.
A better workplace is a shared responsibility, but it starts with you. Wishing you a productive 2017!
About Detry Carragher
As a Chartered Professional in Human Resources (CPHR), Detry Carragher has led Carvo Group since 2004 and is consulted regularly by employers, industry groups, and employees from across Atlantic Canada on a range of employment-related topics.
Her work extends to several of Canada’s Top 100 Employers and Fortune 500 technology companies.
Detry was recently announced the winner of the prestigious HR AWARD OF EXCELLENCE. The award is presented annually to one of over 1,000 HRANS HR Professionals representing Nova Scotia and Prince Edward Island.
Her fresh take on challenging the status quo often sparks meaningful dialogue and change. Detry has contributed her insights on CBC, CTV, and the national HR Reporter publication.