Changing salary review schedule

TD

My company is planning to switch over to a new salary review schedule for 2003. Until now, we've processed merit increases (generally) around the employee's anniversary date. For 2003, we are planning to process all merit increases in July, with the performance appraisal process taking place throughout May and June.

Simply switching over to the new schedule can't be just that simple. Some people will have to wait longer than usual for their increases. What should I consider when planning for this and what are the things I need to counsel the folks in senior management about?

Margaret Morford

Why don't you give each person a prorated raise. If they have to wait over 12 months for the common review date, give them the raise percentage for the addition months in a lump sum at review time. For example, Employee A has to wait 14 months to be reviewed and the raise they receive is 4%. Employee A should get their base salary increased by 4% and a lump sum payment of 4% for the two extra months they had to wait. If you've ever retroed a raise, this is how you do it. If it's been 9 months since they were last reviewed, they should get 75% of their raise percenrage. This way no one is unduly disadvantaged or advantaged by the swithcing to a common review date.

Margaret Morford
theHRedge
615-371-8200
[email]mmorford@mleesmith.com[/email]
[url]http://www.thehredge.net[/url]