‘I am not being paid enough – it’s not fair! My Nephew is on the warpath about his pay and feels that his major multinational employer committing this ‘injustice’ had better provide some credible answers soon. .
How does he know he’s ‘badly paid’? Well let’s start with the realities of the Generation Y graduate population to which my son belongs. According to a growing body of social and employee research, this generation, born between about 1980 and the beginning of this century, is different. Why are they not like us baby – boomers and the Generation X cohort now in its late 30s and 40s? Well for starters they learnt to programme the video machine as toddlers and rapidly became fast, intuitive users of the laptops, play stations, i Pads, smartphones and other gizmos that give them instant access to previously unimaginable amounts of information. They are also self confident, feel free to question almost anything as well as hierarchy and tradition averse. Whereas, the research tells us, older generations did not discuss pay and principally worried about whether they were being paid enough to meet their needs and perceived station in life, Generation Y are more deeply concerned about fairness in relation to their peers as well as how pay decisions are made. The ‘how’ of pay setting matters as much as the ‘what’ of base salary and rewards for performance; fairness and transparency are fundamental Generation Y values and underpin their expectations on pay from their employer.
Given that most communication is digital for Generation Y, checking the salary market appears easy. In a few clicks, it is possible, for example, to go to gottamentor.com for employment advice and on to salary.com, glassdoor.com, payscale.com, vault.com, jobnob.com and a number of similar sites and check pay levels by job title. These sites are interactive, they typically ask how many years you have been in the field, how many people you supervise, where you are located and so on and feed back to enquirers a decent idea of the total package. Some now give named company pay levels by job title – you just run your cursor down the growing list of employers to research your current employer and its key competitors for your skills. Any illusion major employers have in most geographies that their pay policies and practices are confidential has disappeared or is disappearing fast. Anyone astute at internet based research can get a wealth of information on the pay and job market to support their case for a pay rise. Generation Y, of course, will also use social networks as they ‘plork’ (play and work) to share feelings about their research and conduct informal checks on its value.
What does this mean for us pay professionals? Well, first of all we have to recognise that there is nowhere much to hide. If as employers we cannot justify the procedural ‘how’ and distributive ‘what’ of our pay policies and decisions about individual pay levels and progression, the going is tough. If organisational sources of market data are of insufficient quality and coverage, we will get found out. We need to know how to help questioning employees in Generation Y (and beyond for that matter), and their line managers, evaluate all that data in the public domain. They need to understand, for example, the key elements of:
representative samples of people/employers – what matters and why
local/regional/national pay level and reward policy differences
the impact of pay and price movement over time,
the importance of looking at job size and weight – going beyond job title to scope comparable levels of responsibility.
why recruitment market data can be different from salaries paid to people in post.
other strategies for tackling severe talent market pressures than throwing money at the problem.
Total Remuneration and Total Reward comparisons and why they are different – it’s not just the value of the Total pay and benefits package, it’s the whole employer value proposition – reputation, brand image, ethical record, position in ‘best employers’ listings, record on career opportunities and work – life balance and anything else that current and potential employees and stakeholders value
Which is why one of my questions back to my son (apart from asking if he was dissatisfied with his pay or his boss) was ‘If you work currently for an industry brand leader, do you really want to go and work for a less ‘leading edge’ employer for more money? Followed by, how important are the culture and values and market prospects of the firm as well as the career options you have and will you weigh these up too in deciding to stay or go?. And by the way do you know what the score is in terms of comparative pension schemes among the alternatives you might consider – a tough one that, since despite my efforts it’s hardly on his radar?
Can you add to this with your experience of how to build realism about the pay marketplace among employees in Generation Y who challenge current pay levels?
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