Before you make your next hiring decision, consider this very sticky trap: the question of salary. While there are many possible nightmares including poor onboarding and a bad company culture fit, salary is probably one of the easiest to solve. Here are a few tips and thoughts about calculating a new employee salary and hiring the best people for your business.
- Don’t risk losing a good employee with a low offer. Many companies over the last few years have reduced salaries in order to keep their business above water during the recession. It might be time to recalculate this strategy. The old adage “You get what you pay for,” is undoubtedly true. Talk to your candidate about their expectations and take these numbers into consideration as you make a decision. You may pay a little more than you expected or planned but it will cost even more when a lower paid employee leaves for more money or if the candidate turns out to be a bad fit.
- Avoid pay compression. This means that there is very little difference between the pay across multiple levels of your organization. New salaries may be just under those of current employees or, in some scenarios, they might be paid more. This can be extremely bad for employee morale. Keep up with the current market and pay your current employees what they are worth rather than keeping outdated salary information. Create a forecast and plan and know what you should be paying current employees and what the market pays incoming employees for necessary skills.
- Beware the other end of salary negotiations. Most potential employees will be quite genuine when it comes to negotiating their salary. Candidates have been shown the formula for calculating a reasonable pay scale for their skills, experience, location, and cost of living. However, a red flag may be raised if a candidate becomes unreasonable, angry, or argumentative about the salary they feel there are owed. If you begin negotiations and don’t find the other party to be respectful it may be a sign that you should not extend an offer and instead move on to another candidate.
Do you know how much you should be paying for certain jobs? If you are looking for staffing agencies in Dallas TX, contact us today.