It goes without saying that all ER professionals want the nirvana solution when it comes to pay and performance, whereby their recognised unions (and of course their employees) buy-into their pay policy and accept that there is a sufficient distinction when it comes to measuring performance for both operational and strategic employees. But, how is this utopia achieved? During a recent ER Think Tank, (facilitated by Oasis HR) our HR thought-leaders helped us present five top tips for doing just that:
1. Ensure management are on the same page:
Many organisations use a different formula to calculate their employees’ salary entitlement, which is typically evaluated by performance, risk, market salary benchmarking and/or role criticality. However with regard to performance, whether you are measuring staff members from 1-3 or U-6, what’s essential is that managers are on the same page with regards to what each score equates to. This is crucial for demonstrating consistency and fairness in the performance process, thus increasing the chances of getting that imperative staff and union buy-in.
2. Encourage line-managers to take ownership of the performance process:
Line managers must be confident at delivering a solid performance message appropriately to both strong and poor performers when assessing them. This process is undoubtedly enhanced when managers feel that they have ownership of the process. Ensure that they understand that HR is involved purely from a facilitation point of view, but it is ultimately down to the line-manager to fight for the ratings they are awarding their staff.
3. Evidence your decision:
Managers need to be fully trained to deal with the inevitable backlash which might follow should an employee not meet a performance grade they were expecting. A proposed solution is to hold half yearly reviews to assess the level that individuals feel they are performing at. Line-managers must then either confirm this rating or offer direction on how it can be reached by the time of their final review. This small change can provide line-managers with tangible reasoning to support the final performance ranking awarded to their staff.
4. Manage expectations:
Based on the current economic climate, many organisations are facing the challenge of, at best, divvying out small profit pots, which can send conflicting messages to employees who have received exceptional performance ratings but receive little or no bonus. Ultimately, this can result in poor engagement from staff members, for both high performers and those who feel a sense of additional financial entitlement (often historically inherent from days of greater economic wealth). From the offset, manage employees’ expectations and be up-front with regard to their entitlement, both at the initial on-boarding stage and during periods of change throughout employment.
5. Strengthen your union relationship:
One of the main issues that continues to arise with linking pay and performance is transparency (from both an employee and union perspective) as within management teams there appears to be a perceived lack of honesty. On the one-hand, openly publicising how performance is calculated can generate a lot of good will with unions but on the other you can leave them expecting more. However, one of the key ways to encourage unions’ buy-into policies is to demonstrate that you recognise their commercial objectives, and presuming they’re willing, share your business’s with them in a digestible manor. From here it is easier to develop a strategic partnership, as after all it’s much harder to work against unions than with them.
