another as well as assess a job ’ s value or rank in the organization . This created tension as many found it impossible to accept it was their job that was being compared , not them personally .
Finally , we finalized job descriptions and identified applicable and reasonable wages for each level accordingly . This highlighted that many of our employees were receiving wages that were higher than what was reasonable as well as identified those employees who were receiving wages that were below the external market or below what was considered internally aligned . This resulted , of course , in some employees being delighted with the change and others being significantly disturbed by it .
Solutions are Painful and Risky
The decision to totally disrupt our wage practices had an impact on several levels : organizational , financial , and emotional .
Organizationally , every single employee was involved in this process as no job description was left untouched . It took a massive mental and time commitment .
Financially , there were several scenarios that had to be examined .
• What was our acceptable risk for liability ?
• What were salary ranges that made the most sense now and in the future ?
• How would it impact future promotion opportunities ?
• Would people be able to earn pay adjustments , and how could we support them ?
There were a lot of moving pieces and not everyone agreed on proposed solutions and , therefore , ambiguity was rampant .
Perhaps the greatest impact was emotional . Many job titles changed and while this may seem insignificant , it was not . Many employees felt demoted or demoralized with their new titles and many others were confused by career progression because certain titles no longer existed . Wage changes had a huge effect on emotions . Employees who received increases to their wages later questioned if they had been “ under-paid ” or “ under-appreciated ” before . Employees who had , for all intense and purposes , been overpaid , were not pleased when they learned their wages would be “ frozen ” until they caught up to the market . They felt offended , de-motivated and demoralized .
Why Invite the Risk ? We risked increased turnover , increased retirements , lower morale , and increased workers comp claims when we decided to disrupt our pay structure . We also risked over burdening the Human Resources program that would handle the bulk of the work and nearly all of the outrage . This risked our reputation and strongly impacted how employees view leadership .
So why did we do it ?
We knew change was needed to support and sustain our organization both financially and in our efforts to attract the right talent . We knew if we didn ’ t do something significant , our future would be at risk .
We are now confident our pension is effectively funded . While there may be fewer job titles in our new structure , there are now more opportunities for skill development and contributing to the business . We have ceased arbitrary title changes and wage increases , which gives a much better sense of fairness and equity in the workplace , and ultimately will have positive impacts on our employee value proposition .
The process continues to evolve . We work with our leaders to ensure job descriptions are accurate . We work to ensure our total compensation is competitive without putting the future financial health of our organization at risk . But even more importantly , we have used this process as a stepping stone to even more valuable processes such as the development of competency models , professional development plans and succession plans .
Lessons Learned
Leaning into an unpopular process was necessary to lay the foundation for more strategic work . This is difficult and can generate anger and frustration . Leadership must be diligent in building trust and relationships with the workforce so when change occurs , everyone trusts in the process .
Could we have avoided the disruption and stuck with status quo ? Possibly , but we wouldn ’ t have been business leaders with an eye to our future had we stayed within our comfort zone .
Mary is a talent strategist and business leader with almost 15 years experience in helping organizations achieve their goals . After working on the Operations side of start-ups and small companies , Mary landed in HR by way of learning and development , with extensive experience in leadership and organizational development , coaching , key talent planning , talent acquisition , performance management , business partnering , HRIS , process and policy creation , and instructional design .
In addition to her work within companies , Mary authors a leadership development blog called Surviving Leadership ( www . survivingleadership . blog ) to continue the dialogue around the challenges of leadership – both being a leader AND being led .
Mary Faulkner , SHRM-SCP July 2017 35