It’s Only Money – Right?

If you’re an employer that pays the Award rate or on the other hand, pays well below market rates, you could be at risk of your staff regularly keeping an eye out for a better paying role. Sometimes people just accept a job because they need one and just because you’ve filled the role, they may still be looking for the ‘better’ opportunity.

What is the right rate of pay for a role? It really is an open ended question. Some employers wish to pay the Award and that’s actually ok – it’s correct. Some wish to pay a lower salary than the market and make up for it with overtime and bonuses as a lure – this also works on occasion. Some pay well above the market rate which is attractive but can eat into the ROI and then there is the group that pay all within a certain market rate. Neither of these options are incorrect, however, what actually attracts a person to accept your role? There are quite a few answers to that question besides money, however, from our experience in the market, it sits very, very high on the list of things that applicants consider.

 

How do you know what salary to offer / accept?

Now you have to be reasonable here and not go off false information (there’s plenty of that out there). You need collective data. From an employer’s side, you would be silly to take a stab at what you feel is fair to pay someone for a role and hope that someone will take it. Likewise from an employee’s side you can’t just go off the information from a friend who is in a similar role to you but gets paid a whole lot more – one person is not the market. Likewise, if you have just finished Uni and the lecturer suggested that you should be worth $60k because you have a Degree now, it’s also probably (definitely) not correct.

You can look up the Award rate and pay that and you can also look at salary surveys that have been released however, realistically for our market on the Gold Coast, use them as a loose guide and not fact. You can pull a figure out of the air that you feel represents what you would pay for the role (we actually see this often) and could be correct or completely miss the mark. I had a client quite a while ago where every the answer to ‘what do you want to pay’ (for any role) was $45k – that was out by as much as $35k on the worst occasion. Some employers also look at the ABN option as it’s easier/cheaper, except when the person suddenly feels ‘wronged’ a year down the track and you end up with a FWO claim from your now identified ’employee’ not contractor.

The best options:

Yes, you have options and neither of the 3 below methods takes very long at all. They could also save you time and effort and work for you in a positive way to attract the best candidates in the market.

• Make a call – Call a Recruiter or HR Consultant and ask what they have found when recruiting similar roles. Without spelling it out too much, Recruiters work with the market on a daily basis and can give you the salary range and benefits of recent roles they have filled – this is good information to decide on what you will pay for what particular skill level you are after.
• Visit an online Job Board – Jump onto a job board such as SEEK type in the role you are reviewing or wishing to recruit as well as the region and look at the results. The majority of salaries are missing from the results however, every role that is posted has to have a salary range behind the scenes. From the results, use the ‘salary slider’ to work out where the majority of roles fall  – this could be a good guide to work from.
•  Get job applicant feedback – Applicants are the market. Use the question ‘What salary range are you seeking for this role’ during your phone screening before selecting an applicant for interview and there’s your feedback. When reviewing your phone screening/shortlisting form have a look at the responses from those that you are keen on and that could be an indication of the market. Don’t discount the higher end ones either – they may ‘want’ a particular salary however we have often found that ‘want’ and ‘currently on’ are sometimes quite different.

Just doing one or all of the three points above should clear up a few questions you may have. If you do have questions regarding what to pay someone on an upcoming recruit or are conducting salary reviews soon, feel free to call our office on 1300 558 979. We are happy to help you.