Is It Time for a Staff Compensation Study?
By this point, we’ve all heard the term “The Great Resignation.” The influence of the lockdown on lifestyle and mindsets brought people to a place where they re-evaluated their personal happiness index. [Learn more about The World Happiness Report here] This led to many individuals in 2021 leaving their current positions – and at times leaving their employer in a lurch – to pursue other options.
According to the U.S. Bureau of Labor Statistics:
“In November 2021, the number of total separations increased to 6.3 million, up 382,000 from the previous month. Total separations increased in accommodation and food services but decreased in federal government. The number of quits increased 370,000 over the month to 4.5 million, the highest level ever recorded since these data were first produced in December 2000.”
That’s a lot of resignations. And this trend has impacted the nonprofit world just as dramatically as the for-profit world. Competition for employees is increasing, leading to recruitment packages increasing. The impact of this “race to recruit” can be devastating to a budget of any organization, but an overlooked side effect is employee morale.
If you are wondering why this is impacting employee morale, let’s consider the story of the Prodigal Son.
In this story, a wealthy man has two grown sons. One is loyal and dedicated to the family business and works hard helping his father. The other son is restless and wants his inheritance NOW. His father couldn’t dissuade him from his decision of taking his money and going out into the world, so he bestows the money on the other son, and he leaves.
While out in the world, he learns hard lessons about who to trust and ends up losing all his money. He is destitute and has nowhere to go and no one to help him. He realizes he must return home and beg his father to take him back.
The father does not only take him back: he plans a huge celebration because his Prodigal Son has returned! But do you know who this did not go over well with? The son who stayed, worked hard, and continued to help his father build and grow the business.
I’ve always agreed with the Responsible Son. He had a point. While it was great his brother came home, where was the celebration for the Responsible Son who stayed and worked hard and contributed? Shouldn’t both be recognized and celebrated?
It’s the same with employees; often we make a huge fuss over the “New Person” and overlook the people who are already here contributing to organizational success.
This story is one to ponder when dealing with an “employees’ market” where you need to compensate highly to get quality employees, but you may not be adjusting your current employees’ compensation to match the increased recruitment packages required in the current environment.
Consistent policies based on data, both internal and external, help organizations create equitable, thoughtful processes for setting salaries and benefits (remember, compensation is not just money; it’s all the good benefits you provide to staff). By reviewing, and when necessary revising, current staff’s compensation, you send the message that you value your entire team – not just the New Guy.
And it’s an opportunity to quantify for staff the value of the entire compensation package they receive, from salary to health insurance to paid time off.
Regular review and updating of these policies can keep your budget on track and supports employee morale by demonstrating thoughtful leadership.
Did you know that Rogue Tulips can help with your Nonprofit Staff Compensation Study? Let’s talk!
