How to Conduct an Effective Pay Survey

CoolAvenues Newswire | February 21,2014 12:46 pm IST

One of the hardest jobs in managing employees is making sure they’re happy. Although there are many aspects to creating happy employees, a fair and competitive wage is still the number one yardstick in measuring satisfaction.

After all, how many people do you know that work only because they love the work they do?

How do you make sure you are paying your employees fairly? The answer’s enough to fill a textbook. You should always be "selling your story" to your employees not only in terms of pay, but also work environment, benefits, prospects for advancement, and the other so-called fringe benefits. But the first place that dissatisfied employees look is the marketplace, and if you want to stay ahead of the curve, you should look there too.

First, a word about collecting market pay data. There are so many ways to compare your pay against the market -- published pay surveys from consulting firms, online Web survey companies, association groups, and even the Department of Labor. For common, homogeneous jobs, these surveys work great. But for specialized jobs, especially managerial and above, large amounts of reliable data are hard to come by. That’s why there’s no more certain way to collect the right data than through a custom survey. It’s not difficult to do as long as you have your ducks in a row.

Pros and Cons

Customized surveys have several advantages:
1. They can be targeted directly at the companies with the closest match for your position.
2. You can collect current salary data, rather than data that was collected 12 months ago.
3. You can specify exactly the information you want to collect, rather than poring over general salary surveys.

They also have some distinct disadvantages:
1. They can be costly to administer in terms of time and money. However, those costs need to be compared to purchasing survey services, which can be expensive also.
2. They can come under more legal scrutiny with regard to pay discrimination (i.e., several companies collude on wage rates, or "price fixing").
3. Developing a good survey instrument is challenging.

Once you’ve determined the information you want to collect, organizing it in an orderly fashion is not too hard. Some of the most typical pay survey questions ask for the following information:

1. Minimum, midpoint, and maximums of a company’s pay range for the position.
2. Current rate of pay.
3. Number of people in the position (that will help you find the average).
4. Average length of service of a person in the position.
5. Availability and amount of bonus payments.

How to create a good survey instrument: Most custom surveys start with these basic elements

1. Job Title: sounds simple, but as you’ll see in a minute, it’s very important.

2. Benchmark Job Duty Features: The most important element. These are the essential job duties that, along with the job title, will guide your survey participants in selecting the position within their company to report. Generally, keep the list short; only three to four maximum. As a rule of thumb, use the duties that take up at least 50 percent of their time. You don’t want to include duties such as planning the annual company picnic (unless it’s an essential duty).

3. Match Strength: For each position, include an indicator that the respondent can use to gauge how close of a match their position is to yours - generally a one to ten scale. If it’s a low match, such as a one or two, you may want to exclude the data. If it’s higher, but not strong (five or six) you can adjust the data in relation to strength of match.

4. Pay Data: As mentioned above, you want to gather enough information to answer your questions, without asking for too much. Not all companies have the same compensation system, so you’ll want to keep your data fields as general as possible.

The overriding theme of a good survey is "simple." If you want good responses, you need to make it very straightforward for the respondent and not overly burdensome. Therefore, don’t send out a survey for 20 positions, ask for eight different pay sources, and ask for it back in a week. Compensation analysts will turn their nose up at you every time.

The survey process

As it goes with most things, garbage in, garbage out. The root of any good custom survey is a well-designed job description. That sounds logical enough, but it’s surprising how many companies have not done a good job analysis. If you have put together a tight job description, then picking the benchmark features should be easy. Again, you want to make it simple for the HR person on the other end to find the match in their organization.

Once you’re ready to send out your survey, there are a few time-honored tips to keep in mind:
1. If your survey is somewhat involved, pretest it on a colleague or coworker. Unclear syntax or directions can be cleaned up before "going live."
2. Call candidate respondents ahead of time to get their OKs on participating. You may need to play salesperson a little. Be upfront about the details of the survey and what will be expected.
3. Be reasonable - but firm - on response time. Never use phrases such as "at your earliest convenience" or "ASAP," but state clearly the response date. Keep in mind that certain times of the year are worse than others, particularly in the Fall when budgeting and pay adjustments for many companies are being planned.
4. Have multiple options available for respondents to give you information. Depending on the size of the survey, a simple phone call will do. Some are fine with paper surveys, but many might like to get a spreadsheet and to send it back via e-mail (NOTE: the convenience of spreadsheets sent via e-mail is attractive, but take some time to work out security measures, such as encryption and virus protection, so that respondents are comfortable with receiving and sending pay data).
5. Check in a couple of times with respondents to make sure the survey is understandable and also to remind them of the survey deadline.


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