In the first two parts of this three-part webinar series, we learned the ins and outs of budgeting around compensation. In this webinar, Mykkah Herner, M.A., CCP will dive into the PayScale Insight tool to show you how to leverage some of the built-in reports and analytic overviews to help with your budget calculations.

1. Compensation Budgeting Part III:
Putting it all together with
PayScale Insight
Mykkah Herner, MA, CCP
Manager of Professional Services
Karaka Leslie
Product Marketing
PayScale, Inc.
www.payscale.com

2. Three-part Series on
Compensation Budgeting
Part I: Managing Pay Inequities
Part II: Determining Raises
Part III: Putting it all together
with PayScale Insight
www.payscale.com

3. 14,000 Positions
3000 Customers
11 Countries
40 Million Salary Profiles
250 Compensable Factors
www.payscale.com

4. Agenda
Recap of Parts I & II
Part III
Identifying Pay Inequities – Org Level
Identifying Pay Inequities – Position Level
Identifying Pay Inequities – Employee Level
Calculating Pay Increases
By Market
By Performance & Market
www.payscale.com

5. o Start with a plan
o Know your comp Philosophy, Strategy, and
Policy
Recap of
Part I
o Get reliable market Data
o Identify comp inequities at Org, Dept,
Position, and Individual levels
o Org/Plan level: fair pay to market
o Dept level: fair pay across departments
o Position level: have some positions move faster
than others?
o Employee level: are you paying according to
your policy? Fairly based on EEO status?
o Develop solutions
http://resources.payscale.com/hr-thanks-webinarrecording-Compensation-Budgeting.html
www.payscale.com

6. o Know what you want to reward
o Streamline the increase process
Recap of
Part II
o Calculate pay increases
o Market-based
o Merit-based
o Develop budget recommendations
o Range Adjustments (Org level)
o Market Adjustments (Position level)
o Equity Adjustments (Individual level)
o Pay Increase Adjustments
http://resources.payscale.com/hr-thanks-webinarrecording-Compensation-Budgeting.html
www.payscale.com

7. Organizational Level
Pay Inequities

8. Identifying Org Level Inequities
Ranges to Market
o Examine Ranges to Market on the whole – do most move up? Most move
down? What’s the average?
o Do you want to move ranges at this time?
o Budget
o Organizational demands
www.payscale.com

9. Position-Level Pay
Inequities

10. Identifying Position Level Inequities
Ranges to market by position
o Does the market suggest moving the position to a new grade?
o What are the EE compa-ratios for those positions?
o Decide which to move – examine where other positions are in the job
family
o How to identify what type of market premium could be applied to a
position (vs moving the grade)
www.payscale.com

11. Employee-Level Pay
Inequities

12. Identifying Employee Level Inequities
o Paying according to policy:
• green-circled, red-circled
• compression
o EEO Concerns
• resolve critical issues asap
www.payscale.com

13. Calculating Pay
Increases

14. Using a Matrix (Merit or Proficiency)
 Tier increases by position in range & performance
o Start with a budget increase %
o Allocate increases to EEs based on range penetration
and performance
o Create spreadsheet
o Note: Proficiency, or another factor, can work like
performance in this example
www.payscale.com

15. Increase Spreadsheet
Name
Job Title
Alexander, Maria
Account Manager
Current
Range
Annual Base Min
Range
Mid
Range
Max
CompaRatio
New
Range
Increase Annualized Annual
Penetration %
Increase
Base
New
Compa- New Range
ratio
Penetration
$45,900
$46,300 $57,100 $67,900
0.804
-2%
3.80%
$1,744
$47,644
0.83
6%
Arnold, Alexandra Driver I
$29,600
$29,300 $35,700 $42,100
0.829
2%
3.80%
$1,125
$30,725
0.86
11%
Baker, Nicholas
Account Executive
$46,500
$40,400 $49,800 $59,200
0.934
32%
3.80%
$1,767
$48,267
0.97
42%
Allen, Ryan
Program Manager
$86,700
$73,600 $93,300 $113,000
0.929
33%
3.80%
$3,295
$89,995
0.96
42%
Bailey, Sara
Senior Account Executive
$64,000
$54,700 $68,400 $82,100
0.936
34%
2.80%
$1,792
$65,792
0.96
40%
Anderson, James
Customer Service Rep
$45,500
$34,900 $42,500 $50,100
1.071
70%
1.90%
$865
$46,365
1.09
75%
Andrews, Vincent
Senior Account Executive
$76,700
$54,700 $68,400 $82,100
1.121
80%
1.90%
$1,457
$78,157
1.14
86%
Adams, Christina
Account Manager
$63,800
$46,300 $57,100 $67,900
1.117
81%
1.90%
$1,212
$65,012
1.14
87%
0.967625
41%
2.96%
$13,257
$471,957
1.00
49%
Total/Average
$458,700
SUM
•
•
•
•
•
•
AVG
AVG
AVG
SUM
SUM
AVG
AVG
Compa-Ratio = Current Annual Base / Range Mid
Range Penetration = (Current Annual Base – Range Min) / (Range Max – Range Min)
Annualized Increase = Increase % * Current Annual Base
New Annual Base = Annualized Increase + Current Annual Base
New Compa-Ratio = New Annual Base / Range Mid
New Range Penetration = (New Annual Base – Range Min) / (Range Max – Range Min)
www.payscale.com

16. PayScale Delivers Where Other Compensation Providers Fall Short
PayScale leads the world in compensation knowledge with the freshest and
most detailed data from over 40 million salary profiles. More than 3000
organizations use PayScale’s software and intelligence to get the greatest
return on their talent. Smart businesses use PayScale Insight to recruit, retain
and motivate their people.
Visit our blog: www.payscale.com/compensation-today
Join our Group on LinkedIn: Compensation Today: HR Best Practices
Mykkah Herner, MA, CCP
Manager of Professional Services
Karaka Leslie
Product Marketing
PayScale, Inc.
www.payscale.com