In a 2016 Glassdoor report, only 36 percent of employees surveyed worldwide said their companies were transparent about salary – but almost twice that number, 70 percent, agreed with the statement that open discussion of pay boosts employee satisfaction and overall business success.
In fact, social media company Buffer has proven the positive effect pay transparency can have on a company. When Buffer set up shop, its leaders decided to post all employee salaries on the company’s public blog.
Everyone – from the CEO to an entry-level worker – could see what his or her colleagues were taking home.
To many readers, this level of salary transparency may seem problematic, but in fact Buffer grew its staff from 10 to 65 employees in six years. Company officials say conflicts around salary are rare. When all employees can see how much worth the company places on any given role, no one wants to be called out for slacking off.
Another interesting point: A recent PayScale survey of more than 70,000 employees found that people surveyed said they were less likely to quit their jobs when they understood how their pay was determined. Even employees making below-market wages can be persuaded to stay when the reasons for the discrepancy are transparent.
In the PayScale survey, 82 percent of respondents reported being satisfied with their jobs once they understand why were being paid less than they might be at a different company.
Salary transparency is not for everyone
Salary transparency isn’t the best strategy for all companies: Some executives simply aren’t comfortable making pay information so public. This is often true with startups, which sometimes struggle to pay employees competitive salaries.
Many entrepreneurs, whether they’re connected to start-ups or long-time companies, work on a shoestring budget; so when funds are limited, they instead offer unique employee benefits.
In addition, salary transparency may be a bad idea because it can raise conflicts based on assumptions about finances, abilities and how much someone is doing at work. While one employee may take longer to complete a task than another employee, the output might be the same.
In these circumstances, making salary data public could create animosity.
The practice could also inadvertently punish your rock star employees. If they have to fix a problem created by someone who makes more money, they may feel undervalued.
The most important factor for entrepreneurs, then, is to keep the team focused on keeping the company’s doors open – because conflicts combined with a loss in productivity could lead to no pay cheques for anyone.
How to instill confidence in employees in other ways
While salary transparency is not always the best option for every startup, there are other ways to boost employees’ confidence in their pay rate. Here are three:
1. Salary ranges for each position
A salary range offers a minimum and maximum pay rate for each role, as well as several mid-range rates. Such documents, listing companies’ pay figures based on market-pay studies, are often similar in describing employees with comparative responsibilities in a given region of the country.
And they can be reassuring to job-seekers: Because most job-seekers today conduct online salary research, salary ranges based on regional and market factors assure them they’ll be compensated appropriately.
My own business takes a salary-range approach and offers percentage-based bonus structures to employees. This means that workers are compensated based on the percentage of tasks and projects completed within a specific time frame.
2. Project management software
Clear communication about tasks and responsibilities can streamline an organisation and keep employees informed about who is completing which tasks. Knowing that everyone is being productive helps employees see that, regardless of the numbers on a pay cheque, everyone is earning his or her keep.
Project management software can help entrepreneurs relay information to their teams efficiently and keep clients informed. Clearly laying out a company’s tasks and assigning them to the correct person can ensure that everything is distributed evenly and in an organised manner.
My team’s project management software allows us to see what’s on everyone’s plate so we know what everyone is working on – and who’s not producing. We also assign time frames to each portion of a project. Once a project is marked “completed,” we know who worked on what across the project’s development.
3. One-on-one meetings
Nothing beats an in-person one-on-one meeting, especially with so many of us communicating digitally. Face-to-face meetings help build strong relationships with employees and show individuals they’re valuable to the company.
I’ve always had an open-door policy, but I found that employees sometimes feel uncomfortable interrupting me during the workday. So, I started hosting regular one-on-one meetings with everyone, allowing me to get to know each person and gauge his or her individual satisfaction levels.
These discussions often naturally drift to the topic of compensation because of our bonus structure. And here, I want everyone to feel rewarded for putting in effort, just as I want everyone to have the opportunity to correct or self-evaluate when there’s an obvious lack of productivity.
Overall, the most important thing entrepreneurs can do for their companies is show employees how much their contributions are valued. This is particularly vital in the early stages. That’s why instilling confidence in employees about what they’re being paid and why can be essential for attracting the best talent and keeping it around.
This article was originally posted here on Entrepreneur.com.
Is Your Critical Illness Cover Keeping Up With The Times?
Critical illness cover was originally the brainchild of a forward-thinking surgeon who noticed more and more patients were struggling to make ends meet after recovering from life-threatening conditions.
Critical illness cover was originally the brainchild of a forward-thinking surgeon who noticed more and more patients were struggling to make ends meet after recovering from life-threatening conditions. This increase was driven by medical advances, which drove a spike in survival rates – and its consequential recovery costs – something that old school insurance policies did not factor into their products. And while we all know the medical field continues to move forward through innovation, it’s important to ask yourself: has your cover kept up?
Medical advances during the 1960s and 70s didn’t just lead to an increase in patients’ life expectancies, but it also led to financial difficulties for many survivors of critical illnesses and –injuries. Many of these patients were faced with rehabilitation costs and additional expenses caused by lifestyle and/or professional adjustments they had to make to stay on the road to recovery, and they struggled to make ends meet.
Dr Marius Barnard, brother of the famous Dr Christiaan Barnard and respected surgeon in his own right, identified an opportunity to provide these patients with risk cover for these needs. He partnered with a life insurer in 1983, and critical illness cover was born.
Initially covering only four major conditions, medical advances soon enabled the expansion of critical illness cover to many more conditions, like Alzheimer’s or Parkinson’s disease, paraplegia, major burns and brain damage. Lifestyle factors such as smoking, obesity and lack of exercise have increased the likelihood of critical illness claims, but the claims are becoming less severe, thanks to improved medical techniques for the treatment and detection of life-threatening conditions.
Where does critical illness fit into your financial plan?
While medical and, possibly, gap cover can make provision for medical expenses, critical illness cover is instrumental in covering any gaps and providing for lifestyle changes that result from conditions like paraplegia, like the expenses involving alterations to a home to be wheelchair-friendly.
Many medical aid schemes may also exclude certain treatments or not cover them in full, or you might have reached your annual limit. In these instances, critical illness cover may just come to the rescue.
Considering all the scenarios where critical illness products have the potential to come into play, it’s important to ask yourself how forward-thinking the insurance you signed up for really is. Does your insurer factor in the latest treatments, and have they adjusted the range of conditions they provide cover for to keep up with the latest medical research and survival rates?
How many conditions are covered?
Start by obtaining the list of conditions covered by your critical illness policy, because the number of conditions covered vary from company to company. There are life insurance providers that provide cover for over 300 conditions, while some assurers cover fewer than 100 conditions. Some life cover providers also take into account the treatment, clinical impact and effect of an illness, which ensures protection for as yet undiagnosed conditions – this is the kind of cover you should be signing up for.
How do the pay-outs work?
You should also consider the pay-out structure and/or –options of your critical illness policy. There are policies with pay-out options that are helpful for conditions that involve large expenses initially, followed by smaller amounts over a number of months. Importantly, you should be allowed to make certain choices about how your cover should pay out at claim stage, when you know what your physical and financial needs are.
What about smaller events, like accidents?
Forward thinking life cover providers have also identified a need for financial protection in instances where you might have less critical, but still traumatic illnesses or injuries and spent little or no time in hospital.
Just think about the myriad of costs involving corrective procedures, medical aid co-pays, hospital costs, rehabilitation, assistive devices, physiotherapy, wound care, nursing and surgery costs – not to mention being unable to earn an income while you recover from a serious illness or injury. Many of these expenses might be typically incurred just because you aren’t fully covered by medical aid schemes and gap cover products.
Innovations like cover that precisely matches your needs are done in the same spirit of innovation and matching the needs of patients as we saw with Dr Marius Barnard. So before signing up for, or selling your next critical illness policy, ask yourself: Does my cover provider do the same?
- Schalk Malan is the CEO of BrightRock, provider of the first ever needs-matched life insurance that changes as your life changes.
Keys To Simplify Payroll Compliance
Human resources departments across the country cite compliance as one of the top challenges they face. As an SME owner, it’s up to you to ensure that your company’s personnel business practices adhere to the current laws.
Keeping accurate records to document your company’s compliance is just the beginning, says Ania Strydom, Compliance Specialist at Sage.
1. Why is payroll compliance so important?
Payroll is the biggest expense for most employers. Employers must comply with all labour and tax laws that govern the payroll to avoid financial and legal risks and to protect the employees and the business. The risks of getting it wrong include:
- Interest or fines by authorities
- Imprisonment in cases of fraud or extreme negligence.
Payroll fraud is one of the most common white-collar crimes in the business world; what’s more, inaccurate payments and non-compliance can cost a business dearly.
2. What are the implications for staff if a company is non-compliant?
The payroll is one of the most crucial links in the employee-employer relationship. Late or inaccurate wage and salary payments, or inaccurate calculations of other earnings (such as overtime), deductions (such as PAYE and UIF), and contributions (such as retirement fund or UIF contributions) can be extremely damaging to the morale of the workforce.
By law, every employee is entitled to a payslip and tax certificate (IRP5/IT3(a)). Employees need payslips for purposes such as applying for personal or home loans. Accurate and easy to understand payslips will boost employee satisfaction and trust in the company, with a positive impact on business performance.
What’s more, employers must make sure UIF contributions are correct so that employees get the full amount they are entitled to if they need to claim.
3. How will the company’s growth prospects be affected if the company is non-compliant?
While an efficient payroll system enhances staff morale and boosts an organisation’s reputation, mistakes in record-keeping and compliance can result in punitive penalties and hurt the company’s brand. Compliance mistakes with payroll can be expensive and potentially catastrophic which subsequently results in business risks.
4. How can a business ensure it is payroll compliant?
South African tax regulations and labour laws are and continue to be more complex. Keeping track of all the payroll legislative requirements can be challenging, but the risks of non-compliance are high and businesses can no longer rely on spreadsheets and other manual methods to do their calculations, report and file returns.
Automated solutions are becoming more essential for keeping reliable records, reporting and performing accurate payroll calculations.
The package you choose should:
- Be tailored for the local tax law, labour law and regulatory environment
- Manage all the complex calculations and regulatory reporting the business must do timeously
- Feature automated updates to ensure the company always processes on the latest software and legislative version.
This will ensure it avoids censure, fines, penalties, interest and/or imprisonment as a result of non-compliance.
Why Your Employees’ Health Is Your SME’s Wealth
Absenteeism costs R16 billion annually, according to Stats SA. That’s a lot more than it costs to sign up for a group offering that is specifically designed for small to medium enterprises.
- Visit: www.fedhealth.co.za
- Call: 0860 002 153
Fedhealth’s Commercial Executive, Michelle Morton explains the importance of group health cover to keep your SME’s pulse strong.
1. Why is it important for a SME to care about the health of its employees?
First, when an employee in a critical role within the SME falls ill, there’s often nobody else to fill the skills void created by his or her absence. This can have a detrimental effect on the daily operations and business output.
Second, offering sound medical aid may attract and retain the right talent to the business.
Third, choosing a medical aid like Fedhealth, which places a big emphasis on preventative health and wellness, can also assist the SME owner in cultivating a healthy culture in the workplace.
2. What should business owners consider when looking for a group medical plan?
Apart from factors like affordability, a good reputation, and ability to pay claims, look for schemes that offer value-added services, such as wellness days where staff can undergo crucial health screenings, and programmes to address specific health issues.
3. What are the top health concerns for today’s workforce?
Back and neck pain are second to headaches when it comes to painful conditions affecting humans — especially office workers, who are often desk-bound for hours on end. Fedhealth offers qualifying members a 12-week Conservative Back and Neck Rehabilitation programme to help correct the problem through exercise and behaviour.
Diabetes and hypertension are also on the rise, while some employees face HIV/Aids, weight issues or struggle to quit smoking. Fedhealth provides assistance for all these diseases and health concerns.
4. How will the employees benefit from working for a company with a great group medical plan?
I believe it makes the business a more attractive place of work for employees, as medical aid is a much-needed benefit and costly if one has to pay for it out of one’s own pocket.
5. Please explain the importance of the SOS Corporate Wellness benefit
The Sisters-on-Site service (SOS Corporate Wellness) is a value-add as it brings basic healthcare to the office. This means that staff can regularly see a qualified nursing sister at their place of work for minor health issues, instead of having to take time off work to visit the doctor or clinic.
Employees build a rapport with the sister, as they see her on a frequent basis. Through the SOS Corporate Wellness benefit, they can also conduct important health screenings that might flag serious health issues of which the employees might be unaware. Sisters-on-Site can also facilitate monthly health themes to raise employee awareness on issues like breast cancer.
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