Posted by Jane Irene Kelly on Monday, December 16, 2013 - 00:00
You may think your employees understand basic policies like your firm’s compensation plan — after all, you’re managing a team of accounting and finance professionals. But when you consider one-third of chief financial officers surveyed by Robert Half reported their employees are unclear about their company’s strategies and goals, you may feel less confident.
While many small businesses spend a lot of time and effort designing a pay system, they may fail to communicate pay policies, philosophy and administration clearly to their employees. Some accounting managers may think their counterparts in human resources (HR) already have it all covered, while others may simply assume their employees will come to them if they need more information. But often, neither case is true.
So, it’s down to you to make sure your accounting and finance team has access to the information they need about your firm’s pay philosophy and how average salary for positions is determined. Here is what your employees should know at a basic level:
How the performance-appraisal and incentive systems work: Every staff member should be fully aware of how they are being evaluated on the job, when performance reviews take place and how the process is typically structured, and whether they are eligible to earn certain financial incentives, such as bonuses.
How they can raise their own income through performance and promotion: It is important for employees to know that the average salary offered for their role is competitive in their local market, but most professionals also want to know what they need to do to earn a higher rate of pay. For example, according to Robert Half’s 2014 Salary Guide, many accounting and finance employees can expect to earn 5 percent to 10 percent above average salary ranges if they possess graduate degrees or professional certifications. If your firm bases compensation on similar criteria, make your employees aware of that fact. Also, help your staff members understand the path to promotion, which also usually leads to increased compensation.
How to voice concerns: If employees are not pleased with their current pay structure, they need to know whom they can go to with questions. An open-door policy is good practice for any accounting manager, of course, but make it clear that you want your staff to feel comfortable talking with you about their rate of pay. (Note: Compensation can be a hot-button topic, so you may want to ask HR or another senior executive to be present during these discussions, depending on the situation and the employee.)
Communicate change promptly
If at any time your firm needs to make changes to its pay policies — such as freezing salaries or holding back bonus pay — be quick about letting your employees know about it and provide the reason why. Clear, timely and meaningful communication keeps the rumor mill from grinding and helps to reassure and motivate workers. It also gives staff more insight into how management’s decisions are designed to help the organization stay strong and meet its goals.
For additional tips on communicating information about compensation plans and keeping your firm’s pay system competitive and up to date, check out more advice from Robert Half.