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Talk About Salary Expectations Early

Talk about salary expectations early in conversations with prospective employees. If the gap is too, it’s a waste of time to pursue discussions. If expectations are close, then it’s time to balance recruiting new employees with being fair to existing long-term employees.

Exactly how to do this, of course, is the challenge. Following are comments from the recent joint teleconference of the Commercial Lines and Human Resources Practice Groups. Accurate pre-employment tests also were a focus, and we’ll discuss them in a future article.

  • “We basically look at our wage band for a position. If someone is coming in from outside, we look at how many years of experience they have and whether they have special skills that would qualify for extra payment.”
  • “Consider a special market analysis if you need to hire someone in the middle of the year.”
  • “We brought in a consultant to go through every single job and write a description. We also look at the percentile for each person in terms of wages, taking into consideration education, experience and any special designations.”
  • “Salaries in our geographic area are much higher than when we were recruiting five years ago, and it’s becoming a problem. If we pay new employees more than we pay our loyal long-term employees, we become vulnerable to having them stolen by our competitors.”
  • “We focus on total compensation, and always look at benefits.”
  • “We stress that we want people who are looking for a career with us, not bouncing from job to job to increase salaries every few years.”
  • “Start conversations about salary early. We don’t want to find out that someone is making double what we are willing to pay. If we’re close, we focus on what is great about our agency. Some of our competitors expect employees to travel 80 percent of the time and/or work nights and weekends. We try to have the right-size staff so our employees don’t have to sacrifice every single weekend. We want people who are satisfied without getting the ‘best’ salary as long as our salaries are competitive and they don’t have to travel or work weekends frequently.”
  • “Build bridges with applicants. We’ve hired some people who were not the right fit for the initial position for which they applied. We work to build relationships and we’ve hired some of them down the road. People appreciate honesty. We’ve had a couple of people choose us even though the compensation was less but we were honest and talked about career paths.”

Surveys with valid information applicable to local markets can be difficult to find. It’s “frustrating” that the “Big I” is no longer doing a survey, one practice group member said. Another RPNI member does its own salary survey, drawing on both local and national market information.

RiskProNet members have used the following sources for salary information:

Determining Internal Raises

  • “Our internal raises are merit-based. We also look at the size of the book and its complexity. If you have the smallest book in the agency, don’t expect to be at the top of the salary range. We are working with department heads to formalize this process.”
  • “When it come to annual increases, our board of directors sets a percentage, usually between 0 and 5 percent of the overall budget. Supervisors and managers grade their staff members to determine what kind of salary increase they will get, based on their individual performances.”
  • “As we interview people, we keep a spreadsheet of the salaries of those we don’t hire. This helps determine what our competitors are paying locally.”
  • “Our annual reviews tell employees whether they are below target, on target or above target. If they are below target, they are not eligible for a salary increase and go on a performance-improvement plan. They get a 2-3 percent increase if they are on target and a bit more if they are above target.”

A future post from the teleconference will focus on pre-employment tests.

 

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