This Month on Compensation Café * Merit Increases Are Dead & 2 More

Today on Compensation Café I wrote about the possible death of merit increases as a feasible means of managing (and hopefully improving) employee performance. This year’s average merit increase is 3% -- barely a cost of living increase and not enough of a differentiation between employees who at the top of performance will receive a 4% salary increase as compared to those who meet expectations receiving 2.5% increases.

Where’s the differentiation in that? As inflation rises will those merit increases even be noticed? And even those increases for top performers are reliant on a largely failed annual performance review process. How many of you have dealt with the manager who says:

So what’s an alternative? I propose year-round rewards commiserate with year-round recognition of employee efforts. Those who perform at a higher level are naturally more frequently recognized and rewarded for those efforts.

Also this month in the café I wrote about Communicating Compensation, Total Rewards & Meaning in which I ask how well we communicate total rewards and the value of benefits packages to employees. More importantly, do we fully understand what it is about their total rewards package that most matters to employees?

In my third post of the month, I also spoke to the importance of communicating “dinner” vs. “dessert” to employees – ensuring the base compensation is fair and accurate before laying on recognition and rewards.

Pop over to Compensation Café and join the conversation or share your thoughts on this concept here. I’m really interested in what you think communicating total rewards and undifferentiated differentiation reward practices.

Also, don’t forget I’m moving to my own Recognize This! blog on Monday, May 2. Subscribers will move with me. If you want to subscribe to the corporate Globoforce Blog for new multi-author content on Globoforce news, events, customers and products, please subscribe here.