When the COVID-19 pandemic first hit, business leaders quickly looked for ways to preserve their companies. Some implemented pay cuts or freezes, layoffs or even pivoted their business plans and products to continue serving clients.
Now that we’re deeper into the pandemic and some companies are on more stable ground or better know how to handle the situation, they are brainstorming compensation restoration plans for employees. One thing two experts stressed is the fact there is a lot more to consider about compensation than just salary.
Talia Edmundson is the founder and principal of HRnB Consulting, an HR consulting practice that serves small and medium-sized businesses to help them develop efficient employee experiences from start to finish. During the Introduced by Technical.ly conference last month, she and attorney Erin Randolph-Williams spoke with Technical.ly Philly reporter Paige Gross about what companies should be thinking about as they start planning for restoration.
One thing Edmundson said companies will be considering is how they plan to pay back Paycheck Protection Program loans, or figure out how to get them forgiven.
Randolph-Williams, a partner in the executive compensation and employee benefits group in the Philly office of Morgan, Lewis & Bockius, said there are a lot of legal aspects that come into play when having these discussions, especially considering taxes. She works with a wide range of companies from Fortune 100 to startup clients to help them with the compensation aspects, like cash and equity, of their businesses.
Salary can be an emotional thing for some people, Randolph-Williams said, so business leaders should be as transparent with employees as possible. This could mean giving employees as much notice as possible about pay cuts, explaining the why, and keeping people motivated by sharing strategy to get back to where they were. Some states even have laws focused on pay reduction notices.
“We tend to spend what we get paid,” she said. “Our lifestyles grow to our compensation.”
Edmundson shared the same sentiments.
What does compensation transparency really mean and what's it like right now?
"Salary is very personal," Talia said. "It's directly tied to security in every aspect of life."
For company leaders: do your research and then benchmark yourself across everything you discovered.
— Technical.ly (@Technical_ly) September 25, 2020
“I think it’s foolish for companies to think their employees are not talking compensation,” Edmundson said.
Even outside of compensation transparency during this unprecedented time, transparency year-round could benefit employers in the long run. Often employees ask one another about their compensation packages, and if they are in the same roles but have different salaries, they are going to want to know why.
“If you’re going to have a salary-transparent organization, designing that is difficult. It’s a big lift,” Edmundson said. “It’s going to take time, and it’s going to take a lot of research.
Edmundson said that if you dive into this salary-transparent plan, you have to be ready to make up the financial difference if you’re not meeting certain standards and salary ranges. She also stressed that these are not just HR-specific discussion with employees — it involves all of the leadership team and their considerations.
As we continue to work remotely, job seekers should also be asking employers during interviews if there are any technology equipment benefits, what PTO looks like, and what healthcare plans are available and how they have changed during the pandemic.
“Base salary is just one piece of total compensation,” Edmundson said
Randolph-Williams also mentioned that total compensation can mean offering ownership opportunities in the company.
"I would say equity is compensation for sure." -Erin
If you come into a company early, you're going to benefit on the upside if you stay for the long haul.
— Technical.ly (@Technical_ly) September 25, 2020
Randolph-Williams said there are different ways to provide employees with benefits that don’t amount in dollars, so business leaders need to get to know their team members individually and find out what else is important to them.
“See what you can do for individuals that’s not going to cost you more,” she said. “As I said before, you’re going to set a precedent so, if you’re going to give it to somebody, be forewarned that somebody else might ask for it.”
For startup founders, some compensation things you should be considering when first hiring for a fresh role is location, initial team size, revenue outlook and most importantly, what you can afford to pay, Edmundson said. She even suggested using an HR software to compare data for certain roles to come up with those compensation packages.
“This total compensation package that you’re being offered is a complete reflection of what the company values,” Edmundson said.
And employers, take a page out of Philly’s book and stop asking prospective employees their salary histories. Prospective employees, don’t be afraid to negotiate your salary. Do your research, gather your reasons for why you deserve more and practice your presentation to your employer. Sell yourself.
Watch their full discussion here:
How can local governments be more equitable in their support for business?
Yes, innovation can grow in non-tech environments. Here are 5 ways to do it
How can universities be more intentional about their roles in local economies?
Workplaces will be permanently transformed, even after COVID-19 is gone
Sign-up for daily news updates from Technical.ly