Nina Larsen· Benefits Manager, Ravenna Chemicals
Posted in Compensation ·
Our hospital group in the US Midwest, about 9,000 employees, raised the new graduate nurse hiring rate twice in 14 months to compete locally. Nobody modelled what that did to the people already here.
By the time I joined, a nurse with three years of experience was earning on average 1.8% more than someone straight out of school, and in two units they were earning less. We found out through exit interviews.
The fix cost 1.1% of nursing payroll: an experience-based adjustment that restored a minimum gap of 2.5% per year of relevant experience up to year six. My lesson is that every hiring rate change needs a compression model attached before it is approved. How do others build that in?
9 helpful · 1 insightful · 1 agree · 6 replies · 169 views · 2 following
VP, Total Rewards, Ravenna Chemicals
We have a simple rule in the approval form: any change to a hiring rate must show the cost of maintaining the existing gap for everyone within 10% above the new rate. It roughly doubles the stated cost of most proposals, which is exactly the point.
Compensation Consultant, Nordvik Energy
A 2.5% step per year of experience is generous compared with what I have seen. We use 1.5% for years one to five and then nothing formula-driven. Did you find 2.5% was needed, or was that what the budget allowed?
HR Business Partner, Beacon Retail Group
I would be wary of rebuilding a step scale by the back door. We did an experience-based correction for laboratory staff and two years later people expected an automatic annual step. Communicate it as a one-time alignment or you will own it for good.
Reward Partner, Larkspur Manufacturing
From the manufacturing side, the same thing happens with technicians when a new plant opens nearby. Our monitoring report is one line per job: average pay of people with under one year of service divided by average pay of those with three to five years. Anything above 0.95 gets a look.
Global Mobility Manager, Calibre Software
On the 2.5%: it was what the local market data showed between entry and year six, spread evenly. And yes, the warning about step scales is fair. We called it a market alignment and wrote explicitly that it does not repeat. Ask me in two years whether anyone remembers that sentence.
Sonia AlvarezCSI, CRP
Compensation Manager, Calibre Software
