HR Professional - February/March 2009 - (Page 22) C OM P E N S AT ION B Y A L I S O N AVA L O S OFFSETTING ECONOMIC PRESSURES THROUGH PAY ith the U.S. economy sick and ailing and economic growth in Canada slowing, will the trend of companies awarding pay increases continue? Findings from the WorldatWork 2008-09 Salary B Budget Survey show that organizations are plany n ning to continue the pay increases they have a awarded in recent years, despite potentially turbul lent economic times ahead. The national total salary budget increase average i in Canada was 3.9 per cent in 2008 and is expected to increase by the same amount in 2009. When l looking at data by province and metropolitan area, there are slight differences, but generally all areas saw planned increases hover just below four per c cent for 2008, with similar increases planned for 2009. Organizations also say merit increases for top performers will average 5.2 per cent, with middle performers receiving four per cent. W performers not tied to performance and can take money away from programs that motivate and retain top talent. This being said, the survey found some organizations continue to issue general or cost-of-living awards, budgeting a 2.4 per cent rise in salary budgets in 2008 for these programs. Broad-based cost-of-living adjustments only work to retain low and mediocre performers not tied to performance Salary and a slumping economy Organizations give raises and offer competitive w wages to drive employee performance. The same i is true of other compensation, benefits and work/ l life programs—they are about attracting, motiva ating and retaining a productive workforce. The k key is finding the right mix of total rewards to a accomplish this in a marketplace where employe ee needs are diverse but often driven by external p pressures. While organizations continue to plan for pay i increases, some are considering general pay i increases to help employees weather the tough e economy. But broad-based cost-of-living adjustm ments only work to retain low and mediocre 22 F e b r u a r y / M a r c h 2 0 0 9 ‘‘ ’’ Focus spending on total rewards So if pay increases are not in place to help employees through a financial crisis, what other viable options are there? Each individual organization must answer this question by finding the right total rewards programs that will be of most value to employees. The WorldatWork Salary Budget Survey data showed major growth in the y use of flexible scheduling options—60 per cent more organizations have telecommuting/teleworking programs compared to a year ago. And more than half of all organizations now offer flex-time to employees so they can adjust work hours to minimize commutes and provide new opportunities to rideshare or use other forms of public transportation. As more and more organizations offer flexibility for how, when and where work gets done, these programs are becoming a staple of the total rewards package. Employers who do not provide flexibility will soon find it difficult to compete for talent in an environment where employees demand it. The annual WorldatWork Salary Budget Survey is the most comprehensive salary budget survey in the industry, reporting data for more than 665,000 employees from Canadian organizations. With a number of economic events taking place since this data was collected in 2008, it will be interesting to see if organizations will be able to meet their 2009 budget projections. Alison Avalos, CCP, CBP, GRP, is a practice leader for WorldatWork and is a former HR practitioner. HR P ROF ES SI O N AL
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