How to offer the right salary

When recruiting for a new employee, it can be tempting for organisations to set a wide salary range to bring in applicants of the right quality, but then make an offer to a successful candidate at the lowest level. However, the savings on staffing costs this may make are not usually worthwhile in the long run.In this blog post, TPP examines the reasons why you should offer at the right level and the best ways to establish what that is.

Getting the balance right

Specifying an extremely low compensation package for a role will obviously limit the quantity and quality of responses, which is why most organisations advertise using a salary range. But there is no point specifying a range, if you automatically offer at the lowest level.  Remember, if a candidate rejects your offer, it can cost much more to restart the recruitment process than simply upping the salary, particularly when productivity losses are factored in.

Even if a candidate accepts a low offer, they are not likely to be fully motivated in their new role, and may leave after a short period of time, negatively affecting your staff turnover levels and the performance of the organisation.

Conversely, if you offer a new employee too high a salary, that does not fit within the pay scales of existing employees, it can also lead to poor performance. Chances are, your existing employees will find out, and this will lead to resentment among your team. Salary discrepancies can also leave you open to charges of discrimination.

Keeping salaries competitive

The key to offering at the right level is to make sure your salary is competitive. Employees of not for profit organisations will usually accept lower salaries in exchange for intangible benefits such as a better quality of life and higher job satisfaction, but they will still expect to be paid at a similar level to staff in similar organisations.

Monitoring job ads from organisations of a similar type or size can help you to make sure your compensation package is competitive. TPP constantly monitor the recruitment market and can give you help and advice on benchmarking your salaries.

Even if you are simply re-filling a role following the departure of a member of staff, it is not a simple case of advertising the role at the existing salary. The job description and responsibilities for the replacement may be different, meaning you will have to conduct a review of the salary as well. You also need to be consider whether a low salary was a contributing factor in the previous incumbent’s departure.

Setting a salary range (and sticking to it)

Once you establish the industry average for a role, you should set a salary range around that amount.  Make sure you have criteria set to decide which qualifications or skills a candidate would need to have to achieve the highest level.  And which can be sacrificed for a lower salary.

This is particularly important if you are recruiting for more than one position, as differences in salary offers could leave you open to discrimination charges.  Make sure you can back up your decisions and be careful not to simply link salary to years of experience.

The more senior or specialist the role, the more flexible you will need in terms of salary to make sure you get a candidate with exactly the right skills and experience.

Similarly, if you are only interested in hiring a candidate who is currently working for an organisation that is similar to yours, it can take a higher salary to tempt them away from their current employer than someone who is currently unemployed, particularly in the current economic environment when people are reluctant to take risks by moving roles.

Once you have specified a salary range, make sure you stick to this range when making an offer. Nothing is more likely to make a candidate reject an initial offer without any possibility for negotiation than going back on the advertised salary package, meaning you may have to start your recruitment process again from scratch.

What if your initial offer is rejected?

A candidate may reject your initial offer if they feel they deserve a higher salary and could achieve it elsewhere. In this instance you may wish to stick with your initial offer if you think it is a fair one, or you can reassess based on the value they could potentially add to your organisation.

If salary becomes a real sticking point, you could make a revised offer with an initial salary at the original level but with a clearly-defined path of progression to move the candidate up to a higher level within a specified time frame.  This way, the candidate is given an opportunity to prove they are worth the extra and the organisation can ensure the additional investment will be worthwhile.

If there is no room for manoeuvre with the salary you can offer, take a look at the total compensation package.  Make sure you are including all available employee benefits and consider what you could add to make the role more attractive, eg training courses, flexible working, extra paid holiday.  If a candidate is not entirely happy with the salary they may still be willing to join your organisation if they think it will be worthwhile in the long haul.

How TPP can help

TPP Not for Profit constantly monitors salary packages to establish industry averages for roles of every type and level.  We can help ensure your salary is as competitive as possible and give you advice on making the total package attractive to potential new employees.

We handle all potential salary negotiations for roles placed with us and are dedicated to making sure that you get the best possible value for money when recruiting.

Further Reading

Debunking Charity Salary Myths
Low Salaries Hold Charities Back

5 ways to improve your recruitment next year

Managing your recruitment effectively is one of the most significant ways to improve your organisation.  Getting it wrong can cost you in lost productivity and can mean you end up recruiting twice.  Getting it right should allow you to delegate more and have more confidence in your team.  This month, TPP looks at a few ways you can quickly and cost-effectively improve your recruitment.


1.  Spend more time on job descriptions

When you are replacing members of staff, particularly if you are in a hurry, it is tempting to put together a job description as quickly as possible, usually just copying the role requirements of the previous incumbent.

However, spending a bit more time reviewing the job description and person specification prior to starting recruitment will really pay off in the long run.  A detailed brief that defines not only the needs of the role and the organisation, but also the qualities of your ideal candidate will help you to judge interviewees objectively against set criteria, and avoid over-reliance on ‘gut feelings’.

While putting together a job description, you may also find that some duties would be better split or moved around the department, rather than just replacing like for like.

For more advice, see our previous blog post on writing effective job descriptions and person specifications.


2.  Consider your timing

Traditionally, January is the month many organisations start big recruitment drives, as there tend to be more jobseekers around as people resolve to improve their working life in the New Year.  However, it also means your vacancies are competing against those from other organisations, so it may be worth considering moving your recruitment to a different time.  In fact, almost half of British firms plan to recruit before the New Year starts.

It’s definitely worth keeping an eye on the recruitment of organisations similar to yours.  If they are running a recruitment drive at the same time as you, this could be a benefit as your brand can ‘piggy-back’ on their efforts, but it may also lead to competition for the same candidates.

As well as reducing competition for jobseekers, recruiting at less popular times of year, eg around national holidays, could also get you better deals on advertising on job boards or in publications – making your recruitment budget go further.  2012 will be a particularly eventful year, with the Queen’s Diamond Jubilee in June and the Olympics starting in late July.

Even if you need to replace a staff leaver asap, don’t feel pressurised into rushing your recruitment.  Consider using temporary or fixed term contract staff to fill the gap, giving you more time to define the role and allowing you to wait for the perfect time to recruit.


3.  Put a PSL in place

If your organisation hasn’t already got one, putting a preferred supplier list together can have some excellent benefits for your recruitment, the most obvious one being saving you money, as recruitment consultancies included in a PSL usually offer a discount on their standard terms.

However, PSLs also establish relationships with your recruiters, with expectations and levels of service agreed in advance.  This saves you time both in recruitment and administration, and ensures a consistent quality of service across all roles and departments.  Using a small set of suppliers on a regular basis also means they are likely to have a better understanding of how your organisation works and the type of employee that will fit your culture.

You can read more about setting up PSLs in our previous blog post on making your recruitment budget work harder with PSLs.




4.  Use your existing staff more

Your internal employee base is a great resource for recruiters, but one that is often neglected.  As well as an obvious source of in-house candidates, your employees are also your best source of referrals, as they usually have a network of contacts with similar roles in the not for profit sector.  Ensure all your vacancies are well advertised within your own organisation, make sure you advertise them on your organisation’s social media channels and ask your employees to redistribute to their own contacts and consider setting up an employee referral incentive scheme.

You can also use your existing employees to help with the recruitment process.  Allowing them to give feedback on the job description and person specification prior to recruitment is likely to help ensure that a new employee works well with the rest of their team.  Existing employees can also help you review CVs and sit in on interviews, to give you an additional point of view.

Finally, don’t forget to give your staff leavers thorough exit interviews, and to feed the results back into your recruitment programme.  This is one of the best ways to improve staff retention, as it addresses problems when they arise.  See our past blog on the 3 stages of a successful exit interview for more help.


5.  Work on your employer branding

Your employer brand is simply your organisation’s reputation as an employer, and should accurately reflect the values and culture of your organisation.  It is particularly important to protect your employer brand in the charity sector, where being seen as an ethical organisation, both internally and externally, is vital to attract new employees.  There is also a big overlap between your employees, volunteers and supporters, so damaging your employer brand could lead to a drop in support for your organisation’s mission.

Even if you cannot compete in terms of salary with other organisations working to attract the same type of candidate, you can still distinguish your organisation as a great place to work.  Make the best possible use of staff benefits to attract candidates.  Offering flexible working options is particularly attractive to jobseekers in the third sector.

Managing your employer brand is also about ensuring that every interviewee you see has a good experience, regardless of the eventual outcome.  Providing as much feedback as possible is key to this.  See our blog on lack of interview feedback can damage your donations for more information.


Happy new year from all at TPP!

5 ways to engage remote workers

It is increasingly common for employees to wish to work from home on the odd occasion, eg in cases like transport strikes or last year’s snowy weather, or on a permanent basis to give them a better work-life balance.  Many not for profit managers also have to manage ground staff based overseas or in distant locations.

This means that enabling and managing remote working is becoming increasingly important to not for profit organisations - 86% of third sector decision makers say it is their key technical challenge.

But remote working can lead to employees feeling isolated and demotivated, as well as leaving their line managers in the dark about progress.  How can you manage remote staff to make them an effective part of a team?

Why use remote workers?

One of the most common reasons for employees choosing to work from home is to improve their work-life balance, eg giving them time to pick their kids up from school.  Flexible working is one of the key benefits that attracts staff to a third sector organisation (as shown in TPP’s fundraising recruitment survey), so being able to offer remote working is a definite advantage in sourcing top-quality employees.

Working remotely is also traditionally perceived to improve efficiency, as employees are happier and less stressed.  BT claim that flexible employees who choose remote working are 20% more productive than their office-based counterparts, while absenteeism has been reduced by 60%.   Allowing primarily office-based employees to work from home on the odd occasion can also greatly improve morale and therefore productivity.

Remote working also opens up opportunities for people living with disabilities, who might find it hard to work if they had to travel to an office, helping to improve your organisation’s diversity and giving you a wider pool of potential employees.

Many not for profit organisations, particularly those working in international development, prefer to employ local staff who are native speakers to run their programmes overseas.  However, these employees are often ultimately managed from the UK.

Enabling employees to work from home can also allow money-conscious charities to save, as overhead costs are cut and productivity is maintained if staff cannot get in to work, as in last year’s period of snowy weather, in which snow absence rates in the UK were estimated to reach almost 14% and cost the economy £0.5bn a day.

1.  Hire the right employees

Managing your home workers to ensure they stay effective starts right at the point of recruitment.  Selecting the right staff is important – look for employees with previous successful experience of remote working and justifiable reasons for wanting to work from home.  Even if they are not office-based, it is still important that they fit with the organisation and team culture.

It is also important to make sure that contracts set down the terms of remote working clearly, and measures of performance are in place from the start.   Make sure these are consistent across all your remote and office-based staff to avoid generating resentment.

Also detail the parameters of this type of work arrangement. If employees are working off-site, how quickly do you expect them to respond to e-mails, pages or phone calls? Can they work a flexible schedule or do they need to perform their jobs during specific hours? What technologies will be made available to employees to facilitate working remotely? How many days a week can people telecommute? etc.  Not every position lends itself to a teleworking arrangement

The more effort you put into defining requirements such as these early on, the less complicated it will be to supervise people once they are off-site.  TPP Not for Profit has recruited many remote workers to the third sector, and we can offer great advice and help to organisations looking to recruit home workers.

2.  Keep remote workers included

Managing remote workers is all about inclusion – it is all too easy to overlook employees not in the office.  Include remote workers in all team meetings, either in person or via a conference call or on speakerphone, and make sure they are invited to staff events, even informal ones like team drinks.

Lack of opportunities to chat informally with colleagues can also hinder working relationships, as it makes it harder for fellow employees to build the rapport that helps with collaborative projects.  Encouraging all group members to hold frequent discussions can help to keep teleworkers engaged, even if it’s just to let everyone know that work is progressing to schedule.

Where possible, you should also encourage your remote workers to visit the office on a regular basis, eg for monthly catch-ups or for important group meetings.  This allows them to meet their colleagues face-to-face.  If this is not possible, organisation charts and staff profiles with pictures can help remote employees put faces to names.

3.  Train in steps

It’s important to make sure that remote workers aren’t forgotten about when it comes to staff training, both at the start and throughout their careers.

When office staff are trained, a manager can constantly oversee their progress and give instant feedback.  With remote staff, this process is much harder but can be avoided by training in chunks, or scaffolding.  Essentially, the training programme is split into steps and a new employee must be able to demonstrate that they are fully competent in each stage before they can progress.

Training this way means that a manager can be fully confident that their remote employee can handle tasks on their own without constant feedback and support.

4.  Set goals and monitor progress

It is usually necessary to have a more formal schedule of update meetings with remote employees than office-based staff.  Ideally, you should aim to have a quick daily phone call with each remote worker, followed by a longer weekly catch-up.

You need to be even more clear when setting goals for remote workers; making sure that the expectations of both parties are agreed at the start of each project and a schedule of formal contact to monitor progress is set.  There should be clear procedures in place for remote workers to follow and people to contact if things start to go wrong at any point.

When it comes to monitoring the productivity of remote workers, managers have an advantage, in that there is usually an extensive document trail to help them investigate concerns or problems, for example by checking when employees were logged into a network.

5.  Keep improving your processes

If you are successfully using remote workers, it is important to keep evaluating and improving your processes.  Feedback from both remote and office-based workers about how the situation is progressing is vital to make sure both sides remain happy.  New technology is constantly being developed that can help to make remote workers more integrated with the rest of the team.

Most importantly - don't distance yourself from team members. Be available to them, this will increase the trust they have in you and let's you show them that you respect them.

Examples

Some case studies on remote working from the not for profit sector:

ramsac Provide CHASE hospice care for children with Remote Working
NPC slashes ICT costs and risk to maximize its impact
Home-based workers fundraise for charity: Actionaid's NTT operation
Case Study: Merlin Life-saving Communications at an Affordable Price
Case Study: New Charter Housing Group
Case Study: ActionAid

The Pitfalls of Ignoring Poor Performance

Charities are continuing to feel increasing economic pressure and this is having a negative effect on staff morale.  60% of charity staff have experienced redundancies in their organisation, and 55% feel their workloads are getting heavier, leading to stressed and unproductive employees.  And with half of voluntary sector leaders expecting their organisation’s situation to worsen over the next 12 months, the situation is not likely to improve in the near future.

However, not for profit organisations can be reluctant to tackle poor performance in the workplace - only 57% of staff reportedly receive useful feedback on how they are performing.  With over 218,000 employment tribunal claims brought last year, and charities particularly vulnerable to claims, failure to manage underperformance can have serious consequences for charities.

In this article, TPP examines the most common reasons for failing to tackle poor performance, and why these are misconceptions.



"Nonprofits should be kind"

This is an extremely common problem in the not for profit sector.  Most charities recognise that their staff often accept lower pay than in the private sector but expect a higher level of job satisfaction.  Combined with the fact that charities exist to promote ethical values, this can often lead managers to want to be “kind” to their employees, and turn a blind eye to underperformance.

However, failing to tackle poor performance at an early stage is more often than not an unkindness, both for the organisation, whose effectiveness will suffer, and for the employee themselves, who will continue to underperform until their manager has to tackle the problem, which can be a set up for an unfair dismissal claim.  Unproductive employees are also usually unhappy in their job, and treating the problem can improve morale all round.  Being a supportive manager, who proactively handles performance and develops their employees, is not being unkind. Allowing people to fail is unkind.

“We need to follow this through by managing poor performance when it arises. Anyone who hides behind the charity mask on this one and feels it is not compatible with being nice to people is not being professional or businesslike - nor maintaining the charity ethos.”
Valerie Morton in Third Sector magazine


Fear of litigation

Charities are usually heavily reliant on their public image to bring in funding and volunteers, and so are reluctant to enter situations where litigation might result which will give them negative press.  Charity employees can be more willing than most to bring a claim against their employer if they feel they are being treated unfairly, as they have an innate sense of justice and fair play.  This means that voluntary sector managers can be unwilling to speak to employees about poor performance and scared of getting into situations which they feel may eventually lead to dismissal.

Once again, the solution to this is to tackle poor performance at an early stage, rather than simply ignoring it.  Properly handled, an employee may well improve their effectiveness, avoiding the need for dismissal.  But if it does get to that stage, an employee is more likely to feel aggrieved about being dismissed if their employee has not attempted to address and solve the issues leading to the underperformance, and will almost certainly have a stronger case at tribunal because of this.


Worrying about morale

In the current economic climate, when many charities have experienced downsizing, many managers are concerned about maintaining the morale of their team and fear that confronting an employee, particularly one that is popular with the rest of the staff, about their performance may lead to a wave of fear among the team and a drop in morale.

In this scenario, managers are assuming the worst.  Handling unproductiveness sensitively and at an early stage can lead to the employee becoming both more productive and more satisfied, which is likely to positively affect the rest of the team.  If this does not happen, and the process eventually leads to a dismissal, there certainly is a risk that the rest of the team will become worried, but reassurance and support can help to tackle this.  However, leaving that employee to carry on as they are will definitely lead to a drop in morale as the rest of the team have to make up the slack.


Extenuating circumstances

A common reason for underperformance can be personal problems that are unrelated to work.  If a manager is aware of these circumstances, they could very well be tempted to let poor performance slide on the assumption that the employee’s effectiveness will improve once the situation has been resolved.  However, simply ignoring the issue is doing the employee no favours.

Talking through the issue with the member of staff will alert them to your concerns, demonstrate your support in their situation and may lead to a mutually beneficial solution, such as allowing them to take a paid leave of absence.


Losing a star performer

Sometimes, an employee can be a high performer in numerical terms, but can still require performance management for unacceptable behaviour, such as negativity, dishonesty, harassment or bullying.  Managers may be reluctant to tackle this behaviour, even if it is having a negative impact on the rest of the team, for fear of losing their star performer.

Leaving this kind of behaviour untackled ends up sending a message to the rest of the staff that conduct like this is acceptable as long as targets are met.  Staff may become disillusioned and leave due to perceived unfairness.  Performance management should always have the welfare of the team as a whole in mind, not just that individual.


Conclusion

If your beneficiaries are likely to suffer due to a drop in team productivity and morale, is there really any excuse that could be valid for failing to deal with poor performance early on?  A good manager should be able to effectively communicate and document an employee’s poor performance in a timely manner, so that any disciplinary action is never a surprise. If it does happen, it should only be the culmination of a process where the manager is sincerely working to change an employee’s behaviour for the betterment of the organization.


Resources

Further advice on performance management and involuntary redundancy:
KnowHow NonProfit
CIPD
10 point checklist for confronting poor performance
Crash Course: Seven ways to manage poor performance

Training
CS Skills Centre - Managing poor performance
The Centre - Managing poor performance, absence and stress

Healthcare Conferences UK - Managing Poor Performance and Supporting Nurses in Difficulty

Forms & Templates
Various forms are available from HR Bird

Finally, for further guidance on how NOT to conduct a performance review, learn from the master - David Brent.