For executives and other staff to show long-term loyalty to a company, they must feel that the compensation they receive is fair both in terms of normal market rates and compared to other jobs of similar importance within the firm.

Part of the role of HR is to make sure employees understand how different jobs are weighted within the organization. This can be achieved by using a grading system, for example, and linking the various compensation elements to it. In addition, the HR department needs reliable data on the compensation levels and structures prevalent in the market.

In practice, managing individuals' compensation arrangements throughout their career within such a framework while maintaining the all-important feeling of fairness can be very challenging.

hkp/// group supports companies in all areas of compensation management. In our work with clients, we use our proprietary grading model hkp/// JET and draw on our acknowledged expertise in benchmarking compensation levels and systems.

Author Petra Knab-Hägele

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