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Cost of Living for Who???

toniatonia 38 Posts
in Compensation Vote Up0Vote Down
Hello forum!

We were just given release of a cost of living raise! Woohoo! We do add this increase to our current salary band figures for each job. My question is should "everyone" get this increase?

1. The newly hired employee? What if they are already in the salary band, even with the increase?

2. The employee that is leaving the company within a month of the increase?

3. The recently promoted employee with an increased salary? Do they also receive the increase?

Thanks for all responses!!!
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Comments

  • 5 Comments sorted by Votes Date Added
  • Susan in LaSusan in La 107 Posts
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    I would give it to all who qualify to avoid complaints, legal action, etc. Unless you have a policy about newly hired employees, they should get it. The person who promoted should if others in his position do, and the person leaving won't cost you much but will have less reason to bad-mouth the company after he is gone. Fair and consistent is the way to go.
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  • stilldazedstilldazed 640 Posts
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    In case you don't have policies outlining how pay increases should be administered, now might also be a good time to considering putting something in place. Disparate pay practices probably upset more workers than anything other part of employee relations, so having a policy that you stick with consistently could be a good defense when a disgruntled worker complains about not getting a fair shake. If you stay in HR very long, you will be faced with the question. It's always good to have a fair response and not feel like you're in a position where you have to explain why you don't know.

    best wishes.
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  • sonnysonny 2,117 Posts
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    Our cost of livings go across the board . .everyone gets it. .
    We do have some stipulations on merit increases but all of this is driven by policy. .
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  • davidsdavids 427 Posts
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    The questions you should ask are: What is the reason for the cost of living adjustment? Does this reason apply to all employees? Theoretically, cost of living increases (as opposed to merit, competency or performance raises) are given because your employees are either below market or you want to ensure they remain at their current relationship to market. That being the case, it seems like a true cost of living increase would apply to all classifications of employees.

    Also consider, that if you provide COLAs to some, but not all employees, you will be impacting the internal organizational relationships among your employees. When that happens, you will often find supervisors requesting special increases to bring employees back into the former organizational relationship. I would try to avoid getting into that situation.
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  • stilldazedstilldazed 640 Posts
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    Ditto on that last paragraph, and all the more reason to have some kind of plan/policy in place.
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