CompDoctor March 1999

Question: Right after we gave out raises this year, several of our employees in our accounting department complained that their pay is not competitive with the market. We do extensive market survey every year in an attempt to stay competitive, but the number they should me were about 10% higher than the surveys that we use. I want to pay competitive salaries but how can I do that if each survey is different? Are these surveys valid? J. G

CompDoctor What? Do you, J. G., dare say that the data in surveys might possibly be wrong or misleading? You are casting doubt on the profession of human resources specialists? The nerve. I'll have you know that people go to school for a long time and study all sorts of arcane stuff to obtain the pigskin that allows them to conduct surveys. Not just everyone can do a survey you know.

I would bet that if you asked for the name of the company that performed the survey, that you would find that the survey was conducted by an industry group of accountants and published in the highly respected Journal of Exciting Number Crunching. You, on the other hand, probably used surveys that are published by companies that conduct surveys for a living.

If that is the case, you must realize why they brought you the survey. First, it supports their claim of being underpaid. Have you ever had an employee come into your office and ask for a pay decrease because they are over paid? Won't happen, and if it does, I'd seriously question the judgment of that employee. Definitely a CLM (a career limiting move, for you novices) Likewise, if their survey showed they were paid more than the survey shows, they wouldn't show that to you either. Second, they like their survey because it reports on their profession. They have confidence in it. Third, they can read it, whereas, the surveys that you used are probably off limits to their curiosity. Who knows what horrors could befall the highly respected profession of human resources if novices, (that's all non-human resources employees), got a chance to look at the data? They might misinterpret the data, like reading the average salary for a job as meaning the average of the market! (Oops, I think I may have given away the secret).

The human resources profession doesn't place much credence in surveys conducted for professions and reported in their professional journal. (Come to think about it, even the H. R. profession publishing one in their own journal, however, it is done by a professional survey organization). Nor does it place any value on surveys that are reported by executive search companies. Here's why. There are six things that you want to look for in a survey. If they don't have these things, then you might as will pass it up, because the data is likely to be right up there next to useless.

1. The survey should be conducted by an objective organization whose business is compensation surveys. If they do a poor job, there will be thousands of professionals that will vilify them and then refuse to buy future surveys. They have to do the best job they can. It should also be an on-going survey that is conducted year after year.


2. The data that is reported should break out the summaries by type of company (i.e., manufacturing, finance, etc., because different industries pay differently for the same job, especially as you move up the hierarchy), location, size of company as measure by revenue or assets and others.

3. The data should report some, if not all of the following statistical figures: the 25th percentile, the 50th percentile, or average, and the 75th percentile. They should report the number of positions matched to the job and/or the number of companies reporting data. Most survey houses will not report these numbers if they don't have a minimum number of job matches. Usually this number is about 4-6.

4. The job matches should be on the basis of matching similar job responsibilities, not just on the title. Since you can call anybody anything these days, you must match on the job responsibilities.

5. You should be able to get a list of the companies that have supplied the data. While some companies want to protect their identity, not all do. As long as you are not asking for the data for the competitor across the street, then most survey houses will give you the names of the participating companies.

6. Finally, you should make sure that the survey reports on actual employees, not salary offers of people that are in the job market. Salaries of people that are in the job market will typically be 5-10% higher than current employees because that is what it will take for most employees to move to another company.

Most likely J. G., if you stack up your accountant survey to these criteria, you will find that it is lacking and you should banish it to the round file.

CompDoctor. My boss has just quit and I will be taking over at least some of his responsibilities until they can find a replacement. Since our industry is very specialized, I expect that they will not be able to find a replacement for some time. I know that I am not ready to move up to my prior boss's job just yet but it looks like I will be doing a lot of his work for some time in the future. Am I justified in asking for a raise, or a bonus, even if it is temporary? How do I do that without appearing greedy? J. P.

CompDoctor: Dear J. P. Just because you are now doing the work of two people and the company is saving the salary of your prior boss, you think that you can weasel a few more bucks out of the company? Do you actually think that if the company has a chance to reward a hard working employee that it actually will? Guess what, J. P., businesses are in the business of making money, and if they can save a few bucks by having fewer employees, they just might. Especially if they have someone like you who is willing to step up to the challenge.

Of course, there is another side of the equation that they may have forgotten about, and if you are going to be successful in your request you need to use this approach. I can't guaranteed it will win the argument and get you a raise, but, it will certainly level the playing field and get them to thinking that you are not just some doormat that they can walk on. You need to hammer on them with issues regarding productivity and performance.

Let me get philosophical. When you were hired, you entered into an employment contract (even if it is verbal) that said that you were willing to provide certain services and talent for the salary and working conditions that they offered. So far, so good. The equation of performance (yours) equals salary (their cost). Everybody is happy, and as long as this equation is balanced, everything goes along fine. But if it gets unbalanced forces will work to bring it back into balance. It works almost every time.

When your boss left, you were asked to deliver more performance for the same pay. Now, the equation is unequal. You are being asked to deliver more performance for the same cost. For this equation to remain balanced there are two actions that will take place. From your side, either you refuse to deliver more performance, thus keeping your pay in line with the services that you agreed to deliver, or they give you a raise that evens out the equation. If they don't come up with the money, your performance suffers, because your morale is now in the pits and you will hate coming into work and you will not give your best. You may eventually leave and go to a company that values your efforts in order to rebalance the equation.

How does this all relate to you. Here's how. If you will be performing your boss's responsibilities for more than 30 days, then you have every right to ask for a temporary pay adjustment. And, (are you listening employers?) they should be pleased to pay you for the additional effort. The amount you should ask for should be about half of the difference between your pay and the your prior bosses, assuming that you will not be doing every thing that your boss did or at the same level of performance. Then ask it to be paid in a one time, lump sum bonus. Or you could ask for an extended period of paid time off when they find a replacement.

The selling stoke here is that you have to convince them that unless they are forthcoming with the pay or extra paid time off, that it is very likely that performance will suffer in both your old job as well as your bosses. If you have a highly visible job, such as in customer service, this should be an easy argument to make.

Be prepared for them to stonewall your request. In which case, I would rebalance the equation by removing your side.

Back to top

< Back