Setting Compensation Expectations & Pay Practices

Actual Comments on Why Employees Leave:

“When I was hired, I was told I would get a raise every 6 months, which was not true. That’s why I took the job. I worked very hard and took excellent care of my patients. If I went over 80 hours my supervisor would fix my hours to an even 80.”

The Solution

There are a couple of themes with this comment; one about setting compensation expectations during the recruiting process and the other about actual pay practices.

We have no way of knowing whether the comment about receiving a raise every 6 months was actually made and if it was made we do not know the context in which it was made. It is important to note; however, that whether the comment was made or not, it is the perception of the former employee that it was made and perception is reality. For communicating current policy, it is always important to frame in terms of “our current policy is” and add “this policy could change based upon changing business conditions”. Often times, recruiters and hiring managers are so eager to fill an open position they may forget to add the current state could change. As a former benefits manager for a major corporation, I experienced a situation where recruiters told candidates they could add the money they did not use to purchase benefits each year to their total compensation. This was true at the time; however, the practice stopped a few years later and we had a major revolt on our hands. Situations like these anger employees and sometimes result in turnover. If the potential for change had been properly communicated during the hiring process, it is possible the turnover would not have occurred.

For purposes of this article, we will assume employees in this organization are paid on a bi-weekly payroll cycle. We will also assume the former employee was an hourly employee who should have received overtime pay for hours worked in excess of 40 hours per workweek. In this case, what the manager purportedly did was in violation of the Fair Labor Standards Act. The former employer could have reported the situation to the Wage and Hour Division of the Department of Labor. The manager may not have known anything about the requirement to pay overtime. In order to ensure proper compensation expectations and pay practices have a consistent follow through with all management throughout the company, it is important this type of information be provided in new manager and ongoing manager training that is reinforced in company policies and procedures that are readily available to managers.

(This blog post is brought to you by HSD Metrics, an exit interview company that helps companies reduce employee turnover by providing automated reference checking, exit interviews, and by measuring employee retention. The comments from exiting employees that are featured in this blog are collected from actual exit interviews conducted using ExitRight®, HSD Metrics’ exit interviewing service. If you are interested in learning more, contact us today. Because we place the privacy of our clients at the top of our priority list; the names of all involved parties are kept completely confidential.)