Making Compensation a Non-Issue

“Compensation is an equity issue. People want to know that they are being compensated fairly compared to others doing similar work within the company, and to others doing similar work in other companies. After that, it’s a non-issue.”

It really is that simple, yet we continually find ways to complicate the situation. For example, let’s say we’ve got two employees, Bob and John. Bob has been with the company for 20 years, John for only 18 months. They both do the same work and do it equally well. In many cases, Bob would be paid more (in some cases, much more) due to his long service to the company. But is that fair? Should John be punished for achieving in 18 months what it took Bob 20 years to achieve? In truth, John should probably get a bonus for getting up-to-speed so quickly.

Or how about this. Bob has a spouse and two kids to support while John is single and lives at home with his parents. Consciously or unconsciously we may pad Bob’s pay a bit because we know he has a family to feed. That may be a compassionate way to look at the situation, but is it fair? No, it’s not. If both Bob and John do the same work and do it equally well, they should be compensated equally. Their personal situations shouldn’t enter into it.

Equal pay for equal work is such a fair and equitable proposition that it’s beyond reproach. We get into trouble quickly when we try to explain why we’re not practicing equal pay for equal work . . . because frankly, there is no explanation that makes sense.

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