Please respond to each thread in 125 words at least 2 citations in current APA format.
Shape of Future Compensation Professionals’ Discussion Board Response:
Stover
Influential Issues to Watch
In the epilogue, Martocchio (2020) lists five key issues for Human Resources and Compensation Specialists to watch such as increasing the federal minimum wage, performance appraisal changes, bridging the gap between compensation and productivity, the disparity in gender pay, and sharing compensation information. I would add to the list of issues are the changes to retirement plans, particularly as congressional committees are in talks to alter the SECURE Act 2.0. According to SHRM.org, the new retirement act could affect any small business with 10 or more employees and include long-term part-time workers possibly required to contribute (shrm.org, 2021). All these issues are valid and worthy of attention from any HR or Compensation standpoint. Not to mention, the issues will be heightened in a post-COVID-19 world as workers return to work and attempt to do the same work yet in a different manner or adapting to new technology. For instance, Kwong et al (2021) noted “a pandemic is not only a problem of public health; it can also affect other external factors such as the general state of the economy and policy making such as consumers’ preferences and competitors’ responses” (para 6). Kwong et al (2021) recommends human resource professionals should support employees during times of uncertainty, as well as address any anxiety issues and display resilience, which may lead to employee resilience and enhanced engagement.
Key Issue in the Short-Term
As mentioned previously, COVID-19 will have a vast impact on the way the world performs work. For instance, during the pandemic many women had to adjust to part-time status or leave the workforce altogether. For example, Foley and Cooper (2021) noted between March and April 2020 women accounted for 55% of jobs lost in the US and women with children decreased working hours four to five times more than men with children. As women return to the workforce, pandemic interruptions could influence pay disparity. Foley and Cooper (2021) noted pay disparity may be the product of assumptions of the value of men and women’s work produced in compensation system which does not count for pay inequality, and that COVID-19 may be the force to re-evaluate those systems.
References
Foley, M., & Cooper, R. (2021). Workplace gender equality in the post-pandemic era: Where to next? Journal of Industrial Relations, 63(4), 463-476.
Kwong, C., Demirbag, M., Wood, G., & Cooke, F.L. (2021). Human resource management in the context of high uncertainties. International Journal of Human Resource Management, 32(17), 3569-3599.
Martocchio, J. (2020). Strategic Compensation. Pearson.
SHRM.org. (11 May 2021). Congress considers ‘Secure Act 2.0’ with a new round of retirement plan fixes. https://www.shrm.org/resourcesandtools/hr-topics/benefits/pages/congress-considers-a-new-round-of-retirement-legislation.aspx
Second threats:Note
Introduction
There are a few issues that will shape compensation professionals’ work for years to come and beyond as the future of work changes. While each one is important to the world and can become influential, there are certain issues that can create the greatest uncertainty. The author will briefly describe the issues and why they can become so influential, and which one could create the greatest uncertainty.
Compensation Issues
The five issues that are discussed in the text (Martocchio, 2020) are “potential increases to the federal minimum wage, performance appraisal trends, compensation-productivity gap, the gender pay gap, and the pay transparency” (p.360). The federal minimum wage is currently at $7.25 and has been since 2009. This is an influential issue as many workers are not able to afford housing and simple life items on a 40-hour work week with this amount of pay. “The federal minimum wage is one of the more significant antipoverty policies in the U.S. social welfare regime” (Gitterman, 2013, p. 4). However, the minimum wage rate has been proposed to be increased nationwide, however, many legislatures have denied this. Furthermore, states that have higher living wages such as California, has decided to raise their minimum wage to assist with living situations and to reduce layoffs.
The trends in performance appraisals have been decreasing as many are not using performance appraisals as a means to drive business results. However, some companies still use them to help frame their communication to the employees about their performance and reasoning for pay increases or the lack thereof (Martocchio, 2020). Some organizations deem performance appraisals effective, and some do not, however, Iqbal et al., (2015) finds that researchers consider performance appraisals effective when it is found useful by the acting stakeholders. This compensation issue sets the tone for the organization’s approach for feedback, promotions, and merits. Some organizations have a culture where performance appraisals are not necessary because the manager is able to provide constructive feedback on a regular basis without formal ratings and the employee’s performance is measured as such. However, it could be very influential in organizations who do not have that type of culture considering that some need to have clear documentation surrounding raises and why certain actions were taken.
The compensation-productivity gap according to Martocchio (2020) “refers to the difference between real hourly compensations and labor productivity” (p.363). When Covid-19 hit this issue was a major influence in the compensation world for professionals as employees did not feel paid enough for their true labor, and now that the pandemic hit and employers needed workers, they were forced to pay higher wages for the labor. Some other changes are the technology investment, the skills of the workforce and the capital investment. This issue can be a problem if the labor continues to overpower the compensation which can increase unemployment and drive employees to rather be at home collecting government benefits rather than working.
The gender pay gap has been an issue for a very long time and even sparked a day such as Equal Women’s Pay Day on March 24th. This issue shows the constant gap between a woman’s pay and a man’s pay and how long a woman would need to work to just barely reach the man’s pay. This is an influential issue as diversity and inclusion has been increased over the years and pay is an integral topic of this discussion. It has been said that the gap decreased by 10 percent however, it took 30 years for this to shrink (Hamidullah et al., 2021).
Pay transparency is ideally how the organization chooses to provide pay information to potential applicants and current employees about future openings. It can be considered a secrecy when an organization does not provide the salary, however, some organization do provide pay ranges. This can be influential in the light of the Covid-19 pandemic as labor shortages are present. This can also help the culture of the company and attract the right talent and those that truly have the skills to receive the pay. This issue also plays a role into the gender pay gap, considering that the transparency would be available so it would open the door for compensation discussion among men and women in that position.
Uncertainty for Compensation Professionals
The pay transparency is the one issue that can potentially create the greatest uncertainty. Pay transparency is considered full when the organization is able to reveal all of the pay information, such as decisions, pay grades, and ranges (Martocchio, 2020). Heisler (2021) provided research that the issues in pay between men and women are caused by the pay secrecy or the lack of transparency in pay. With the onset of Covid-19 and many job seekers knowing what their skills are and how they can enhance a company, knowing organizations need associates, pay transparency can potentially help organizations attract talent. It can attract those who do not have the skills necessary, however, the job of the compensation professionals will need to be strategic in screening to ensure that they are entertaining the right candidate for the right job. Pay transparency can cause an issue among current workers, considering they may have applied for the job or not known about the position; however, the pay transparency can help them understand the compensation prior to inquiring. This also allows for employees to not entertain a role if the pay is not what they are looking for, which can help the compensation professionals determine if their role and wages are truly attracting the right talent.
Conclusion
Many issues arise in the compensation world such as gender pay gaps, pay transparency, and other items. However, each issue has its own influence in the working world and some stick out more than others. The pay transparency is one of the largest issues that can impact all of the other issues as a whole and close the gaps. Furthermore, as compensation professionals continue reviewing the strategic compensation process it can help the organization to be successful in this area and still remain competitive.
References
Gitterman, D. P. (2013). Remaking a bargain: The political logic of the minimum wage in the United States: A federal minimum wage. Poverty & Public Policy, 5(1), 3-36. https://doi.org/10.1002/pop4.23
Hamidullah, M. F., Riccucci, N. M., & Lee, I. P. (2021). Citizens’ perceptions of closing the gender pay gap: An experimental study. Public Management Review, 23(7), 1032-1055. https://doi.org/10.1080/14719037.2020.1722207
Heisler, W. (2021). Increasing pay transparency: A guide for change. Business Horizons, 64(1), 73-81. https://doi.org/10.1016/j.bushor.2020.09.005
Iqbal, M. Z., Akbar, S., & Budhwar, P. (2015). Effectiveness of performance appraisal: An integrated framework. International Journal of Management Reviews : IJMR, 17(4), 510-533. https://doi.org/10.1111/ijmr.12050
Martocchio, J. J. (2020). Strategic compensation: A human resource management approach (10th ed.). Upper Saddle River, NJ: Pearson ISBN: 9780135175910.
Discussion Board 5- Shaping of Future Compensation Professionals’ Work .docx
