behan
HR Analyst
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Pay Review Date

Pay Review Date

We currently review employees pay based on their start date. I have been asked to provide a business case for changing this to the same date across the business (e.g. 1st April.)

I would like to know if any other companies have gone through this how how they found it?

And what the industry standard process it. We are an IT Software company with 6,000 employees globally.

Many thanks
Siobhan Behan

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27th Jun 2006 15:30

Hi Siobhan
By far the industry standard is to move to an annual pay review date as opposed to individual start dates. It will also be advisable, since your current practice is focusing on service related reward which may create a challenge for you going forward.

In order to prepare a business case, the first step is to look at the costings. If you are going to move to an annual review date from individual dates, you will need to 'compensate' individuals for the pro-rata amount of the year that applies to them. For example, if they used to get a review in June and you are now proposing March, you would be doing a review based on 3/4 of the year. On the other hand, if they normally get their review in March but you are proposing June, they would need a review based on 1+1/4 year.

Communication around this is vitally important and you will need to consult.

It is a complex process - but do-able and certainly worthwhile in the long run from a budgetary and control perspective.

As a first step, I suggest you analyse the spread of your review dates to see if there is a key time of year that could be adopted with the least amount of disruption/cost (eg if a large number of people have a recruitment date in April - go for April annual reviews!).

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