Addressing Employee Concerns

By Jim Fox and Bruce Lawson, Fox Lawson & Associates, A Division of Gallagher Benefit Services, Inc.

Question: Our organization is getting ready to begin a classification and compensation system review. Our employees are, to say the least, a bit nervous about the study and what it will mean for them. They believe that they do more than employees in other agencies in comparable job classifications and they want to make sure that this is considered during the study. Do you have any words of wisdom that will help us address employee concerns as we begin this process?

CompDoctorTM: Let us first make sure we understand your question, as this is something that we have rarely heard from employees in other organizations that we have worked with over the past 25 years. You say that your employees believe they do more than others in similar jobs in other communities or organizations that have similar or comparable job classifications and you want to make sure that their concerns about the study recognizing this fact is taken into account during the study. This is really a much more complex question that you mayrealize. In those rare occasions that people feel they do more than others (we are obviously being a bit facetious here), the issue can be related to perceptions about a number of different situations.

The first and most common issue relates to the amount of work that one person does versus another, either within the organization or in other organizations. We know that this may come as a shock but some people feel that they just work harder than their peers. Workload may relate to the number of positions available to do the required work, the confidence that a supervisor or manager may have in the reliability of one employee over another in terms of getting stuff done so they put more on their plate than they do on other’s plates, or simply that some people work faster or smarter than others so they are more productive. Unfortunately, none of these situations changes the type of work or the level of the work that is actually performed. As a result, this situation should not be addressed as part of a job classification review. Please note we specified classification here. Compensation is another matter but we will get to that shortly.

The second most common issue relates to organizations that assign a different mix of duties to one position versus another position that is currently in the same job classification.

This could conceivably be a job classification issue IF the duties performed by one position are of a higher level or a totally different type than others in the same class.

Obviously, the organization will need to determine whether assignment of the higher-level duties to the one position is appropriate but that is a whole other matter. If the work performed by an employee is truly of a higher level in terms of the level of responsibility and/or the skill/knowledge required to perform the work, and the higher level work does meet the standard for being an essential duty of the positions as defined by the EEOC in the guidelines related to essential duties under the American’s with Disabilities Act, then, depending on the classification concept (broad versus narrow job classifications) that has been adopted by the organization, a separate or higher level job classification may be appropriate. However, if the work is simply different but it is comparable in terms of type and level, then a change in job classification would likely not be justified.

Now we can move on to the more important issue—how much an employee should get paid versus other employees, both within the same organization and relative to other organizations organizations that are within your defined labor market. Let’s take each issue separately.

When in comes to paying your employees based on market conditions, one thing you absolutely have to deal with is how you see your organization relative to the labor market. By this, we simply mean are you trying to pay the median of the market or do you want to be the highest paying employer. That philosophy will dictate how you respond to an employee relative to their concern.

Quite frankly, there is always going to be another employer who will pay more than you do. They may or may not be out front about it but they do exist. Unless you are committed to never having to say you’re sorry (we apologize for the reference to a line in Love Story), the fact that someone else pays more is a reality of the market.

If you are trying to pay your employees competitively (somewhere around the 50th to the 60th percentile of the market), there will always be employers who pay more, just like there will always be employers who are paying less.

There are a couple of other key points we feel compelled to raise. The first is that when

someone tells you that my brother-in-law’s next door neighbor’s cousin works at the neighboring city and she or he does the same work that I do but gets paid $20,000 more, you need to step back and say “whoa.” The problem with these types of situations is they are anecdotal at best. While someone may be in a similar job, each organization will structure the job a bit differently. That is why the Department of Justice and the federal courts have provided guidance relatively to salary data comparison related to the Sherman Anti-Trust Act (which is a whole other topic for separate discussion).

"...there will always be employers who pay more..."

Nevertheless, the WorldatWork guidelines stipulate that a job can be used for comparison purposes if it is a 70 percent match to the subject job. (We have addressed that subject in previous columns.) Since professional standards stipulate a 70 percent standard, that means there could be a 30 percent difference. The other thing to keep in mind is that the other organization may pay its people differently than you pay yours. They may have a performance based system and you may not.

Now we can get to the issue of workload. From our perspective, a pay system that does not recognize the contribution of an employee is going to address this issue. For those organizations that are committed to the traditional step type pay plan where all employees can advance to the top of their respective salary range or grade based on simply meeting basic job requirements simply cannot address this issue. However, those organizations that address individual employee performance can and typically do compensate high performers more than average performers.

We could keep going on this topic but we hope you get the idea. There is no one answer but you absolutely need to understand and explain why differences may occur.