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There are several online compensation resources that publish salary data, but employers should question the methodology being used for those surveys as well as the quality of the data and its relevancy to your organization.

The best way to accurately assess how your pay practices stack up to the market is to perform “compensation benchmarking,” a process that matches your internal job descriptions to external jobs with similar responsibilities in order to identify the market rate for each position. Compensation benchmarking is a quantifiable, objective way to determine how your organization is positioned relative to the market. The process involves defining, valuing, analyzing, and summarizing market data and comparing it to your organization.

Compensation benchmarking will help you determine if your organization is paying fair and competitive compensation by enabling you to standardize your pay structure and align it with your organization’s goals. The knowledge you gain from compensation benchmarking will allow you to define your compensation strategy to attract and retain top talent, increasing your competitive position in the marketplace.

Not sure where to start in planning a compensation project? Enlisting a third party can save you a tremendous amount of time and effort. Consider working with HR Knowledge; we can help take the complexity out of compensation management. We’ll work with you to define a compensation benchmarking solution that aligns with your organizations goals, including diagnosing and designing salary structures, validating base pay in relationship to the market, and evaluating relative job worth. Want to learn more about our compensation benchmarking services? We’re here to help; please contact us for additional details.

About HR Knowledge
Founded in 2001, HR Knowledge, Inc. is a privately funded company providing integrated outsourced HR services tailored to our clients’ needs. Our full array of offerings includes managed payroll, employee benefits administration, and HR consulting and support services, such as training, compliance, custom-built software solutions, and Hiring Process Management™, our comprehensive recruitment service that takes you from finding to onboarding new talent. Our major markets are fast-growing small- and medium-sized businesses, many of which are venture-capital-backed; foreign companies expanding into the states; and charter schools. Partnering with HR Knowledge can reduce your administrative costs, minimize your legal risk, help you find and develop talent, and alleviate the HR burden so that you can focus on your core business.

This content is provided with the understanding that HR Knowledge is not rendering legal advice. While every effort is made to provide current information, the law changes regularly and laws may vary depending on the state or municipality. The material is made available for informational purposes only and is not a substitute for legal advice or your professional judgment. You should review applicable laws in your jurisdiction and consult experienced counsel for legal advice. If you have any questions regarding this blog, please contact HR Knowledge at 508.339.1300 or email us.