HR Quarterly

Employers are facing ever tighter controls and greater regulation around pay and benefits. This increased regulation is creating greater pressure on the reward function to ensure robust processes around what and how people are paid and get the basic infrastructure in place so that there is consistency and compliance across the businesses. While each employer is addressing the reputational risks around pay governance in ways appropriate for their business, common themes include:

  • Ensuring an appropriate controls and process framework is in place across the reward agenda to minimise operational risks and inconsistencies
  • Clear pay policies that are standardised across businesses to reduce inconsistencies and inequities between business units
  • Robust grading frameworks with greater guidance on how to position people within these
  • New approaches to pay progression linked to market, performance and other factors – rather than the formulaic approaches which serve to perpetuate equal pay risk
  • Improved processes and controls between business units and the centre (for example in bonus calculations), and
  • Harmonising Terms and Conditions to minimise risks of claims and manage employment costs.

In South Africa the legislative changes in the Employment Equity laws are clearly going to drive the actions of reward and human resources professionals in the coming months. The process of assessing risk of non-compliance starts with a detailed analysis of your current remuneration practices and benefits policies. This will include assessing your internal equity based on all the grounds specified by the legislation as well as any other arbitrary grounds. We recommend that you do the analysis by job title and job grade or, in the absence of a grading system by organisational hierarchical level. Large range spreads in your own data could be an indication of non-compliance.

Some of the topics covered in this issue are:
  • Reward 2020
  • Moving people with purpose, the competitive imperative
  • Are South Africans retirement savvy?