Salary Trend and Corporate Culture - 2014
Ria Mary John
With the overall positive growth outlook employees are hoping for a better salary increment this year, meanwhile according to Buck Consultants' seventh annual Compensation Planning Survey, average base pay increases for 2014 will remain at 3% among US companies for the second year in a row, and with many companies emphasizing on performance-related pay the increment will depend on the productivity of both the employee and the organization.
As per the most recent survey conducted by Mercer from nearly 1500 mid-size and large organizations in US, which included executive, management, professional (sales and non-sales), office/clerical/technician, and trades/production/service; high performers particularly in the field of Information Technology and Medicine received an increment of about 4. 6 % and average performers received 2. 6 % in the year 2013. Experts are expecting more or less the same percentage of increment this year as well.
Among many organizations which has adopted performance-related pay method, Whole Foods follows an unusual policy to promote competition within the company by encouraging the employees (from CEO to junior level workers) to view and have conversation about salary. Whole Foods co-CEO John Mackey explains that his initial goal was to help employees understand why some people were paid more than others and they understood what types of performance and achievement earned certain people more money, he figured, perhaps they would be more motivated and successful, too.
Pay for performance method is slowly altering the corporate culture for many organizations to one of teamwork and result oriented workforce. Following are few of the key observations;
- The performance management system seems to be getting tougher, as salary increment for an employee depends on when his or her team, department or when the organization accomplishes certain production and quality benchmarks.