compensation communication survey participant report solertia_2016_en
TRANSCRIPT
Compensation Communication Practices Survey - Participant Report
Compensation Communication Practices Survey (February-March 2016)
Solertia Consulting Group
Claudio Gardonio, M.B.A., B.I.B.C, CEBS, CRHA
Karine Bergeron, CRHA, CEBS
April 29, 2016
Content
2
• List of Participants
• Highlights
• Results
• Points to consider
• Appendix: Biographies and services
Context
3
• The survey aims to understand current compensation program communication practices of organizations
• The survey explores the following themes:– Communication practices of the salary structure;
– Communication practices of short-term bonus plans;
– The media used to transmit the value of the total compensation;
– Perceived effectiveness of communication practices;
– Communication intentions and efforts.
• The survey also examines the practices of organizations which reported having effective communication practices
• The survey was conducted in February and March 2016 across Canadian companies, mainly in Quebec and Ontario.
The Participants
5
Public, 11, 19%
Private, 47, 81%
Is your organization private
or public?
1,000+, 12, 21%
500 to 1,000, 5, 8%
200 to 500, 12, 21%
10 to 200, 29, 50%
Number of employees?
Other, 4, 7%
Canada, 4, 7%
Quebec, 3, 5%
Greater Montreal, 47, 81%
Location of head office?
List of ParticipantsSurvey Participants
6
47 Private Companies• Alarme Sentinelle • Groupe AGF • Lightspeed
• Association des chirurgiens dentistes du Québec
• Groupe Censeo • Moisson Montreal
• Auberge Saint-Antoine • Groupe ISN Canada inc. • Negotium Technologies Inc
• Belron Canada • Groupe Lemur • Novexco Inc.
• Biron Groupe Santé • Groupe Robert • Optelvision
• Caisse de dépôt et placement du Québec • Groupe Robitaille • OS4 Techno Inc.
• Ceriko Asselin Lombardi Inc • Groupe Swagelok Québec • Paiements Pivotal
• Cirque du Soleil • Gwava Inc. • PolyExpert
• EH Price • Hitek Logistic • Radiologie St-Martin & Bois-de-Boulogne
• Emballages Poliplastic Inc. • Hubert et associés • RICHARD BEGIN R.I.INC
• Enviroplast inc • Incell Inc. • SDR Imports Co. Ltd
• Envitech Automation 2009 inc • Jam Industries • Société de services dentaires ACDQ inc
• Équation Humaine • KD Services • Sogedent Assurances inc
• Groupe Fordia • La turquoise, Cabinet en assurance de dommages et services financiers
• Stationnement Safeway Canada Limitée
• Gestion Robgroup Inc. • Langlois avocats • Université McGill
• GL Creations • Lavery
List of ParticipantsSurvey Participants
7
11 Public Companies• ADP Canada Co
• Andritz Ltd
• Banque Nationale
• Bristol Myers Squibb Canada
• CDK Global (Canada) Limited
• Dundee Corporation
• Engagement Labs Inc.
• Industries Lassonde
• Intact Corporation Financière
• Metro-Richelieu Inc
• Ubisoft Divertissements
Highlights
9
The Survey clearly revealed that participants want to do much more to improve the effectiveness of their communication strategy. Here are some highlights:
– Two thirds of the participants have a salary structure;• Over 75% inform their employees of its existence but only 46% explain the functioning of the salary structure and the same
percentage communicate the monetary value of the salary structure
– Nearly 80% of respondents have one or more short-term incentive plans;• Variable compensation differs depending on whether the organization is private or public
• All respondents in public organizations indicate that employees know their target bonus, only 43% in private organizations
• Almost three quarters (73%) of respondents in public organizations indicate that bonus targets are communicated to all employees, only 15% among private organizations
– Half of the participants indicate that the organization knows and calculates the value of the total compensation; • Of these, half indicate that their employees know the value of their total compensation
– The media used to convey the value of total compensation;• Those that communicate the value of total compensation (48% (28)) are using the following media: informal discussions,
individual statements (paper) and individual statements (online)
Highlights
10
– Practices of organizations that believe their communication techniques are effective:• They frequently have a salary structure (79% vs 67%)
• They further inform employees that they have a salary structure (60% vs 50%)
• However, organizations that believe their practices are effective inform employees of how the structure works and the value of the scales at about the same frequency as those who judge their practices as ineffective
• They indicate more frequently that employees know the value of total compensation of the jobs (54% vs 25%)
• They indicate most frequently that they use individual statements (paper or online) to communicate the value of their total compensation to employees (36% vs 14%)
Does your organization inform its employees that it
uses a salary structure?
13
05
1015
2025
30
No
Yes
9
29
Among the organizations that have
a salary structure, 76% inform
employees that they have a salary
structure
Does your organization inform employees about how
the salary structure
works?
14
05
1015
2025
No
Yes
24
13
Among the organizations that have a
salary structure, 35% inform the
employees on how the salary structure
works (grades, how positions are
evaluated, levels, width of scales, etc.)
Does your organization communicate to employees the
monetary value of the salary
scale to which they belong?
15
05
1015
2025
No
Yes
24
13
Among the organizations that have a
salary structure, 35% inform the
employees of the monetary value of their
salary scale (evaluation, amounts at
minimum/midpoint/maximum ($))
What type of short-term variable compensation
is available in your
organization?
16
0 2 4 6 8 10 12 14 16 18 20
None
Discretionary bonuses
Profit sharing
Bonus plan based on performance
More than one of these choices
12
8
3
19
15
Among the organizations that offer
short-term variable compensation,
bonus plan based on performance is the
most common
Do employees know their target bonus
(% of base salary)?
17
05
1015
2025
3035
We do not have target bonuses
No
Yes
21
6
31
The target bonus is generally known
Are target bonuses communicated to all employees
for each position?
18
05
1015
2025
We do not have target bonuses
No
Yes
21
21
15
Nearly 60% of organizations do not
disclose the target bonuses
What type of salary surveys does your organization
use?
19
05
1015
2025
None
Free data on the Internet
Specific surveys in the industry
Database or reports from compensation firms
18
7
9
23
Database or reports from compensation
firms are clearly the most common
Does your organization communicate to employees
that it conducts salary
surveys?
20
05
1015
2025
3035
No
Yes
33
23
Nearly 40% of organizations disclose
that they conduct salary surveys
Does your organization calculate the value of each
job’s total compensation package?
21
• 50% of companies indicate that they calculate the value of total compensation
• Of these:• 29% have informal discussions• 36% communicate in a statement
on paper or online / intranet• 35% do not communicate the value• 80% of companies do their own
internal communication
Yes50%
No50%
Do employees know the value of their total
compensation ($) and
its different components?
22
05
1015
2025
3035
40
No
Yes
36
21
Over 60% of organizations indicate that
employees do not know the value of
their total compensation
What method does your organization use to
communicate to
employees the value of
their total compensation?
23
We do not communicate the value of
the total compensation
52%
Other3%
Individual statement
(online version or intranet)
7%
Individual statement
(hard copy)16%
Informal discussion
22%
Slightly more than half of the
participating organizations do not report
the value
Does your organization outsource its compensation
communication
(in part or in whole)?
24
010
2030
4050
No
Yes
46
11
19 % outsource the communication to
one or more of their compensation
suppliers
(eg: pension plan provider or group insurance
company)
Overall, how would you rate the effectiveness of your
current compensation communication practices in
fostering a better understanding of employees' total
compensation?
25
• 43 % of companies consider that their currentcommunication practices are effective
• 41% believe that the practices in place arouseorganizational engagement from the employees
• Half said that the communication practices are alignedwith the organization’s business goals
Totally Ineffective
9%
Ineffective48%
Effective43%
Overall, how would you rate the effectiveness of
your current compensation communication practices
in fostering a better
understanding of
employees' total
compensation?
26
05
1015
2025
30
Totally Ineffective
Ineffective
Effective
Very Effective
5
28
25
0
One organization out of two indicate that
communication is either ineffective or
totally ineffective
Overall, how would you rate the effectiveness of your
current compensation
communication practices in
encouraging employee
engagement and
motivation at work?
27
05
1015
2025
30
Totally Ineffective
Ineffective
Effective
Very Effective
4
30
23
1
Nearly 50% say their current
communication practices generate
engagement and motivation
Overall, how would you rate the alignment of your
current compensation
communication practices
with the organization's
business objectives?
28
05
1015
2025
30
Totally Ineffecive
Ineffective
Effective
Very Effective
3
26
28
0
50% say their current communication
practices are aligned with business
objectives
How does your company plan to change its efforts in
compensation
communication over the
next two years?
29
05
1015
2025
3035
Same Efforts
Decrease Efforts
Increase Efforts
26
1
31
Over 50% of participating organizations
plan to increase communication efforts
Does your business have a concrete compensation
communication plan to be
launched or one that is
currently being rolled out?
30
0 510
1520
2530
3540
45
Yes
No
16
42
72% of participating organizations do
not have a concrete plan
What are your organization's compensation issues?
Some answers ...
• Adjust to the needs of younger / Y generations that seem less sensitive to conventional compensation, besides the salary and bonus;
• Communication of total compensation;
• Reliability of market data;
• All that is related to the non-salary offer (insurance, pensions);
• Internal equity, harmonization of policies and practices;
• Five respondents have pay scale issues;
• Highlight the value of social benefits and other benefits.
31
Barriers to Communicating CompensationWhat is holding people back
33
• Fear of being confronted
• Prefer to keep the space for flexibility and discretion
• Fear that it is "discovered" that not everything is equal for all
• Do not want to be obliged to inform of any future changes
What are the perceptions or fears that restrict people to
communicate?
Board of Directors,
Senior Management,
Management,
Finances or HR… What do we communicate when we do not communicate?
By saying nothing, people do not know what we do well ...
An Engaging Communication – Why?
34
Know the true valueFor the perception of fairness, that employees understand the actual aggregate value of the
compensation envelope
The numbers do not tell the whole story
Hallway discussions
Because people talk, and it is preferable to explain the differences rather than have them brought to light
Silent dissatisfactionBecause there are people experiencing dissatisfaction who do not speak up, but the repercussions can
be felt
To promote total compensation and emphasize the elements of total compensation that
are not cash compensation
Compensation Communication Continuum What is the optimum level of transparency for your organization?
35
Closed Transparent
• What is your level of confidence of your compensation policies and its effectiveness in achieving your talent
management goals?
• Would transparency positively affect your engagement and retention challenges?
• How familiar are managers with your compensation programs and are they ready to have conversations about it with
their team?
Factors to be Considered
My Pay
The employee knows his/her
total compensation and
confidentially discusses it with
his/her manager. The manager
knows the salary ranges of the
position within his/her team.
The Company does
its HomeworkIt is communicated that the
Company has a compensation
philosophy, job evaluation plan,
and salary structure based on
grades
Here is our
Structure
The Company communicates
its compensation philosophy,
grades, the width of pay ranges
and market surveys used
Fully Opened
The Company communicates
grades, which jobs are in which
grade, the midpoints of the
ranges and comparison groups
used for market survey
What is Engaging Communication?The employee’s questions are answered and the employee leaves even more enthusiastic
36
Adapted
Comes from the person
who knows us,
understands us, and
who can adapt to us
Relevant
Is relevant in time and
provides the
information to take
action in a timely
fashion
Inspiring
Changes perceptions,
providesa vision, and
inspires us to move
forward
Touching
Touches our emotions
Karine’s Bio
Karine Bergeron, CHRP, CEBSManager, HR Consulting
Karine contributes to the growth of Solertia Consulting Group being
responsible for services to businesses in the greater Quebec City area.
Karine is a passionate business professional and has many years of
experience working in Human Resources Management mandates
including training, compensation, career mapping and performance. She
has worked with SMBs across Quebec and Canadian subsidiaries of
international companies. Karine is a graduate of John Molson’s School of
Business and University of Laval, and a member of WorldatWork, of the
Order of Certified Human Resources Professionals (CHRP) in Quebec,
and of the Chambre de la sécurité financière. Karine has given
conferences to various business community audiences, and is also an
Emploi-Québec certified trainer.
Karine brings a refreshing vision of Human Resources Management
projects in an approach based on best practices, rigor, and innovation.
Servicing her clients with the highest level of professionalism, ethics, and
quality is her objective. She is able to do this all while relying on a
collaborative approach. With her field experience in a variety of business
environments, she can assist you in aligning your practices with your
business objectives.
Claudio’s Bio
Claudio Gardonio, M.B.A., B.I.B.C, CEBS, CHRPSenior Director, Total Compensation
Claudio Gardonio holds the title of Senior Director, Global Compensation
at Solertia. With a solid experience of over 20 years in global
compensation and change management, Claudio has recently joined the
Company. In the past four years, Claudio held the title of Senior Vice
President for a large company headquartered in Quebec. Claudio is
recognized as a strategic consultant and as an effective change agent. He
holds a Master of Business Administration (MBA) from Université du
Québec à Montréal (UQAM). He is a Conseiller agréé en avantages
sociaux from the Chambre financière and Certified Employee Benefits
Specialist (CEBS) from Dalhousie University, Nova Scotia. Mr. Gardonio is
a member of the Order of Certified Human Resources Professionals
(CHRP) in Quebec du Québec and sits on the ESG Alumni Association -
UQAM.
Claudio is a seasoned expert in the field of compensation, specializing in
the development and implementation of compensation policies and
programs for senior executives. His services will allow you to distinguish
yourself from your competitors in order to attract and retain talent.