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How to solve the salary mystery

It’s just like Mick Jagger said: “I can’t get no satisfaction.” As soon as one need is met, another one crops up to bug you.

Old Maslow must have had this in mind when he set up that “hierarchy of needs” to illustrate that getting one set of needs taken care of (like food, shelter and a CTA bus card) only leads you to start worrying about the next one. This goes up the ladder until you finally have your hands on an iPod.

The same applies with the matter of pay in the Midwest technology environment.

You first need to get a job and focus on that. At least once in a while, most of us find time in our busy schedules to sit back and wonder whether we’re really getting paid the proper amount. You’d hate to think the person in the next cube is getting paid more than you (with his second-rate degree and all).

Heck, is your company taking into account the patent that has your name on it and the fact that your team was the only one to meet its on-time targets last quarter? You can tie yourself up in knots just wondering how you’re paid versus the rest of your colleagues.
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Here are some suggestions on how to relieve that anxiety and go back to focusing on important stuff (like the office football pool).

First off, any company should be able to tell you how it determines the pay levels of its employees. Most companies of 100 employees or more will have some sort of formal pay structure for you to see. If you ask, the company should be able to tell you your grade level and show you the salary range that corresponds to that grade.

For example, you might inquire and learn that you are an “Engineer I” and that there are two levels of engineers above you. You may also learn that you’re paid fairly high in the range for an “Engineer I” and you’ll be an “Engineer II” in no time if you play your cards right.

The company should also be able to reference the data sources it used to construct its pay structure. The company should update its data every year. For instance, the company may subscribe to a salary-survey data service or use a compensation consultant once a year to synch it up with the local market.

If you nose around and find out that these systems are neglected, you might ask your company to do a quickie evaluation of your pay against your job requirements. You can even help out in that effort by taking a look at the closest job to yours in a public database like Salary.com.

You can also do a Google search on “salary + survey + marketing” to get a more specific data source. Most industry trade journals include an annual salary-survey issue that you can find online or in a library.

A headhunter friend can tell you whether you’re being paid fairly relative to the job market. If you’re in a company, though, the information from your headhunter friend isn’t going to carry a lot of weight.

If you want to have a solid argument for reevaluation of your compensation level, you need to show published salary-survey data. You can write to any friendly list serv (ChicWIT in Chicago is one good one; Nine2Five readers know that I’m one of the founders of the group) and ask for advice about where to find such data.

In the best case, you’ll learn from your inquiries into the company’s pay systems that you’re right where you should be.

Smart companies spend some energy explaining to employees how their pay level is determined. There’s no louder and more resounding message about what the company thinks about you than what they pay you. It’s a sign of poor leadership to approach this issue casually or haphazardly.

An example would be: “Well, Bill and Jeff are making $43,000. Because this guy was at Jeff’s old company and he graduated college a year after Jeff, let’s pay him $42,000.”

While your own manager may not know the specifics, any HR person at the manager level should be able to explain how the company decides what each employee should be paid. This is a critical management function that should deserve a fair amount of planning, forethought and communication to employees.

What sorts of questions should the company be prepared to answer? Here’s a list:
  1. How does the company address external equity and pay fairness relative to the rest of the local employment market?
  2. How does the company manage internal equity and pay fairness inside the company?
  3. How are changes in job requirements treated in the pay system?
  4. Which data sources does the company use to refresh its pay systems and how often is this done?
  5. How does an employee move from grade to grade?
For me and lots of other HR people, comp and benefits issues are not the things that make our hearts beat faster. Given the importance of smart and well-reasoned pay decisions to every single employee, the subject can’t be dealt with lightly.

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Liz Ryan is the founder of ChicWIT (Chicago Women in Technology) and founder of WorldWIT (World Women in Technology). She can be e-mailed at lizryan@worldwit.org. Her column Nine2Five, which appears on ePrairie every Friday, is designed to keep you up to date with career trends and advice related to working and managing organizations in the post-bubble technology world. This article has been syndicated on the Wisconsin Technology Network courtesy of ePrairie, a user-driven business and technology news community distributed via the Web, the wireless Web and free daily e-mail newsletters.

The opinions expressed herein or statements made in the above column are solely those of the author, & do not necessarily reflect the views of Wisconsin Technology Network, LLC. (WTN). WTN, LLC accepts no legal liability or responsibility for any claims made or opinions expressed herein.

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