IBM Smarter Workforce Summit Toronto 2015: Creating Compensation Ambassadors
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The document discusses the importance of engaging managers as 'compensation ambassadors' to effectively communicate pay structures and philosophies within an organization. It emphasizes that improved manager communication skills can positively impact employees' perceptions of pay fairness. Additionally, it outlines PCL's employee-owned structure, compensation philosophy focused on competitive pay and performance-based rewards, and the training provided to managers for effective pay-related discussions.
IBM Smarter Workforce Summit Toronto 2015: Creating Compensation Ambassadors
- 1. Creating Compensation Ambassadors: Engaging Managers To Willingly and Effectively Talk About Pay Louise Karp PCL Mark A. Szypko, CCP, GRP IBM
- 2. © 2013 IBM Corporation IBM Smarter Workforce “If it were up to me…” “My hands are tied!” “HR made me do it!”
- 3. © 2013 IBM Corporation IBM Smarter Workforce Copyright Kenexa®, 2012 3 REALITY PERCEPTION friends & family coworkers articles/publications the internet corporate culture • Aligned to the market (median) • Equitable across similarly situated employees • Compliant with relevant statutes • I’m not paid enough for the work I do • I don’t know why they pay me what they do • My co- workers who do the same thing make more than I do
- 4. © 2014 IBM Corporation4 Perceptions of Pay fairness over time 51% 55% 55% 54% 54% 55% 49% 57% 59% 58% 53% 50% 60% 20% 30% 40% 50% 60% 70% 2001 2002 2003 2004 2005 2006* 2007 2008 2009 2010 2011 2012 2013 %ofEmployeeswhoBelieve PayisFair Notes: WorkTrendsTM . * Data were not collected in 2006, so mean across all years was used.
- 5. © 2014 IBM Corporation5 Impact of managers communication skills on employees perception of pay fairness Source: WorkTrendsTM 2013/2014 Canadian data SA A N D SD
- 6. © 2014 IBM Corporation6 Managers who feel comfortable having salary discussions
- 7. © 2014 IBM Corporation7 Managers Belief In Organizations Compensation Philosophy Source: WorkTrendsTM 2013/2014 Canadian data
- 8. © 2014 IBM Corporation8 Managers Belief In Organizations Compensation Philosophy Source: WorkTrendsTM 2013/2014 Canadian data 81% of Managers Feel Well Prepared with 2 or more. SA A N D SD
- 9. © 2014 IBM Corporation9 Employees: More Communication = Better (to a point) 25% 50% 75% 100% 0 1 2 3 4 Understand how pay is determined Know how to maximize pay Number of communication methods used
- 10. © 2013 IBM Corporation IBM Smarter Workforce “It is up to me…” “My hands are NOT tied!” “HR helped me do it!”
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- 12. Number of Employees More than 4,400 full-time professional and administrative salaried staff and more than 10,000 hourly tradespeople Markets Buildings, heavy industrial, and civil infrastructure Annual Construction Volume Over $7.5 billion North American Headquarters Edmonton, Alberta, Canada US Head Office Denver, Colorado Geographic Area The United States, Canada, the Caribbean, and Australia Portfolio PCL is involved with more than 700 projects at any one time. These range in value from $20,000 to more than $1 billion and include office towers, residential condominiums, retail outlets, hotels and resorts, educational and health care facilities, casinos, sport and entertainment complexes, bridges, airports, high-tech facilities, water treatment facilities, petrochemical/power/oil and gas plants, and major plant maintenance shutdowns. Ownership 100% employee-owned PCL is a group of independent construction companies that carries out work across Canada, the United States, the Caribbean, and in Australia. These diverse operations in the civil infrastructure, heavy industrial, and buildings markets are supported by a strategic presence in 31 major centers. 12
- 13. PROJECTS that Inspire 13 Canadian Museum for Human Rights Glacier Skywalk Syncrude Plant
- 14. Employee Ownership Why be just an employee when you can be an owner? Benefits for Employees • 100% of the shares of PCL are held by its employees • In addition to receiving competitive wages, employee shareholders share the profits that they help PCL to generate Benefits for Clients • Extraordinary performance by employee shareholders, motivated by a higher return on labour and investment, delivers outstanding value for clients 14
- 15. PCL’s Compensation Philosophy Target Pay Competitively • Comprehensive and competitive compensation package in each region in which we operate • Regularly evaluate market competitiveness against our industry peer group Pay for Performance • Individual contribution and performance are factors considered when making compensation recommendations • Recognizing and rewarding performance is critical to reinforce positive performance 15
- 16. Managers Equipped: Managing your projects… managing your people • Supervisor toolbox – Accountability, administration, effective delegation, employee development, employee engagement, team building • Supervisor development – Supervisor fundamentals, formal training for supervisor, coaching, mentoring, individual learning • HR as a resource – Provide communication tools, coaching and feedback 16
- 17. Managers Enlisted: Key players in structure development and implementation Confirm job information and evaluate jobs Create job grades based on job value Determine and validate market benchmarks Marry market pay to job value Undertake pay analysis Determine pay policy line Determine salary ranges Determine adjustment costs and policies Implementation and regular review for competitiveness 17
- 18. Managers Educated: Base Salary Progression Over Time 18 S a l a r y R a n g e MidpointMinimum Maximum Entry Zone CR <90% Target Zone CR 90 - 110% Max Zone CR >110% Employees who: • are new to the role or in the early stages of their career, or • exhibit lower levels of proficiency, or • demonstrate tolerable levels of performance Employees who: • are seasoned in their career and are top performers, or • exhibit mastery, or • demonstrate considerable capabilities and are expected to grow further Employees who: • are proficient in their role and still growing in their career, or • exhibit competent proficiency, or • demonstrate ability to take on larger/stretch role
- 19. 19 Little to No Increase Lower Performer Paid Higher Average to Above Average Increase Higher Performer Paid Higher Nominal Increase Lower Performer Paid Lower Significant Increase Higher Performer Paid Lower Low Performance High Performance Higher Pay Lower Pay
- 20. Bonus Award and Share Ownership: Tied to Performance Performance Bonus Award • Individual, organizational and business unit performance are all factors in determining annual bonus awards • Additional recognition for Star employees Share Ownership • Employees who have demonstrated commitment to the company and have significant career potential within PCL are considered candidates for share ownership • Additional recognition for Star employees 20
- 21. Managers Empowered: Arming managers to be compensation ambassadors • Enabling managers to “comfortably” have meaningful conversations regarding compensation with their employees • Reinforce and drive high performance • Which leads to reduced HR- related costs my CAREER. my COMPANY. my LEGACY. 21
- 22. Questions?