The Chartered Institute of Personnel and Development (CIPD) has released its latest guide, The Pay Review Process, which raises awareness of the need to establish the pay review as a business process and offers insight on how to achieve this.
The guide aims to help reward and HR professionals review their existing pay processes or establish new schemes.
The research highlights good practice from 16 public, private and voluntary sector organisations, including FirstGroup, Kent County Council, John Lewis Partnership, McDonalds, Moog, Oxfam, Royal Bank of Scotland, Sainsbury’s, Shell, Specsavers and Transport for London.
The guide explains how to align pay awards closely with the needs of the business and identifies ten central messages for organisations to adhere to, including the importance of effective planning and the gathering and interpreting of relevant data.
It also encourages practitioners to keep processes as simple as possible, to use management tools to support decision making and to use previous reviews as a basis for improving current practice. It recommends that roles and responsibilities need to be clearly defined early on, and gives tips on using the pay process as a positive vehicle for change, to help foster business success.
Charles Cotton, adviser for performance and reward at the CIPD, said: “Too often, the annual pay review is seen as a tick-box HR process, rather than a vital business process impacting on organisational strategy, despite the huge sums of money usually involved.
“Get it wrong and it may send out mixed messages on what your organisation values in terms of employee behaviours, skills, attitudes and performances. On the upside, the employers we have spoken to have emphasised that getting it right can create value for the organisation by supporting the employer brand.”
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