COMP NEWS – A new survey has indicated that less than a third of workers think their compensation is fair – and more than two-thirds are at risk of leaving for greener pastures and paychecks.

Less than a third of employees feel that their pay is fair, according to a survey by analyst company Gartner, while almost two-thirds think their pay is unequitable and are at higher risk of leaving.

Gartner’s survey of around 3,500 employees found that staff who consider their pay unjust have a 15% lower intent to stay with their current employer, and are 13% less engaged than those who think their pay is fair.

Last year, a Gartner survey found that 84% of reward leaders are conducting pay equity audits annually in a bid to close pay gaps.

“Employee perceptions of pay equity aren’t rooted in compensation,” said Tony Guadagni, senior principal in Gartner’s HR practice.

“Instead, the main driver of perception is organisational trust – when employees don’t trust their employers, they don’t believe their pay is fair or equitable.”

Another surprising find in the survey is that less than half of employees say they understand how their pay is determined. The results also showed that when organizations communicate total value propositions to employees, their trust and perception of pay equity both increase.

Gartner found that the key factor in whether employees felt they were being paid fairly was trust in their employer. Accordingly, businesses need to rebuild trust where employees’ perceptions of their pay are negative.

Its survey revealed that only 38% of employees understand how their pay is determined. When organisations communicate and educate employees about pay decisions, their trust increases by 10% and perception of pay equity by 11%.

Colleagues are likely to be sharing salary details already – in a survey conducted by the analyst firm earlier this year, 43% of employees discuss pay with colleagues in the same role, and 45% consult third-party salary sites.

The decrease in employees’ trust in their employers to communicate pay information correlates with an increase in employees discussing pay with colleagues.

Colleagues are likely to be sharing salary details already – in a survey conducted by the analyst firm earlier this year, 43% of employees discuss pay with colleagues in the same role, and 45% consult third-party salary sites.

Guadagni said many of the reasons for pay inequity stem from manager decisions around hiring, promotion and performance assessment, meaning it’s crucial to broaden accountability around pay decisions.

To read more about the survey and why so few workers feel their compensation is fair, click here.

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