CAPÍTULO XXIII: LA MUJER Y EL DRAGÓN

salary increases or extra payments based on changes in a referenced price index, usually the Consumer

Price Index (CPI). They may be implemented automatically, if stipulated by a union contract.

Chapter 9: Using Salary Surveys

Salary surveys are a consultative tool that employers and associations use to ob- tain salary information that is useful in determining the competitive wage rates needed to attract and retain competent employees. Employers can use surveys in different ways; as well as establishing a competitive salary structure, they can use the surveys to support their job evaluation system. When job evaluation and survey data are used jointly, internal and external equity are mutually reinforced. The focus of surveys tends to be on collecting base salary information and they can also be an effective means of researching trends in the design of benefits pack- ages and pay systems.1 _{Pay structures tend to be strongly influenced by practices} in the sector, the organization size and local labour market conditions.

In North America, Europe and most of the other industrialized countries there are numerous organizations for profit and not-for-profit which specialize in con- ducting salary surveys and can provide data information on such things as on the cost of living, the cost of employee relocation and inter-regional variations, along with information about job evaluation.2 _{However, small to medium-sized} community-based agencies do not usually have the resources to carry out com- prehensive external salary surveys, let alone commission such studies by outside organizations. Within the not-for-profit sector, large-scale, wide-ranging surveys tend to be the prerogative of associations and sector councils.

This chapter explains how to identify salary surveys which are relevant to the needs of organizations within the not-for-profit sector, and specifically within community-based agencies. It also provides information on the meaning of some survey terms and discusses the value of survey participation.

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Employers use salary surveys to compare pay levels in their organizations with those of similar jobs in outside organizations within the relevant labour market.3 These surveys are usually carried out by or for large organizations, specialist firms, associations and government, in some cases on a routine basis. They may emphasize particular jobs, regions, size of organization or sector. Since the data collected is based on current information, it is valid for a limited time period; usually a year or possibly two, if a valid inflation factor is added.

The types of data gathered in salary surveys can include aspects of compensa- tion such as base pay, performance pay, general increases, merit pay, ranges from minimum to maximum, entry-level pay, benefits, working hours, job qualifi- cations, geographical location and whether positions were filled internally or externally.

Survey information is useful to employers in many ways. It can be used to show whether an organization’s compensation levels are aligned with market rates, to 1 Monica Belcourt, et al., Managing Human Resources: 2nd Canadian Edition,

(Toronto: Thomson Nelson, 1999), 367.

2 “Employee Salary Surveys,” EzineArticles, Jun. 17, 2006, Dec. 2007

http://ezinearticles.com/?Employee-Salary-Surveys&id=222409

allow compensation levels to be adjusted to market levels, to track sector trends in compensation packages, to develop pay structures, to assess issues in compen- sation management, to calculate human resources costs of other organizations and to research information just prior to negotiations with unions.4

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Published reports on wage and salary surveys offer comprehensive access to in- formation about compensation levels in the labour market at a relatively low cost. Accessing these sources is relatively less costly than carrying out in-house research and has the increased reliability associated with large-sample surveys. When analyzing survey data, managers need to identify and focus on those jobs covered in the survey which most closely match the jobs in their own organiza- tion. The only way to do this with any precision is to review the brief job de- scriptions attached to the survey; job titles alone do not provide enough detail to ensure true matches. Having identified comparable jobs, managers should make certain that pay rates are described in a comprehensible way within the survey; for example, the different types of pay (base pay, performance pay and indirect pay) should be reported separately. Internal benchmark jobs should be selected from the survey jobs that have been found to be comparable.

Once the benchmark jobs are compared, salary survey results should include a summary of the data analysis. A basic report on survey results needs at the very least to show job title and the average or median salary for each job in the survey. Typically, though, survey reports should show more detail.

Managers need to assess the potential value of a survey from a number of per- spectives. They need to find out if it is current enough, if it covers comparable jobs, organizations and geographic areas, if the sample size for each job is large enough and if it indicates total compensation for each position along with break- downs for different types of pay, benefits, bonuses, etc. As well, managers need to ensure that data on pay levels are not distorted by organizations at either high or low-paying extremes, that respondents have formal compensation systems in place, that competitors in the labour market are covered. Finally, to increase the likelihood of getting the best picture of the labour market, managers should use data from more than one survey.

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Benchmark (or key) job is a standard job from either within the organization or outside the organization used as a reference point for pay comparisons. These jobs have relatively the same job content, and there is not much difference in their rates of pay.

The mean is the average pay calculated by adding up all the pays for benchmark jobs and dividing the sum by the number of benchmark jobs. This measure is most sensitive to unusually high or low pays.

The median is the discrete number at the middle of the range of benchmark jobs; for this number half of the jobs are above and half are below. Medians are not “the average” pay. The median is less sensitive to salary extremes than the mean.

4 George T. Milkovich, et al., Compensation: First Canadian Edition,

(Toronto: McGraw-Hill Ryerson, 2005) 177.

Salary Survey

information paid by employers for various jobs in the labour market. Salary information is often used to price benchmark jobs, and it is used to compare salary levels in an

organization to external jobs.

External Equity (External