Compensation Conversations: What HR Needs To Know

Tips for talking about compensation and inflation with employees. Learn the best tactics for salary conversations in 2022.

Inflation has increased even more dramatically over the last month, pushing the consumer price index to a 7.2% increase from a year ago, the highest since 1982.

Employees and job applicants are eager to talk about inflation and their need for higher compensation. Talking about money can be tense even when offering salary increases, and the current situation makes these discussions even more challenging. When expectations are not met, there can be tension, conflict, and ill feelings.

You can shift your tactics to have more productive salary discussions that foster mutual understanding, preserved relationships, and a productive workforce. Applying proven approaches will enable you to address critical employee concerns and answer challenging questions.

• What are employees’ and applicants’ expectations relating to inflation?
• How does your culture link expectations, employee performance, and pay?
• Why is transparency essential in today’s environment?
• How can you answer the most vexing questions about performance and pay?
• What effect should the market have on your compensation system?
• How much independence should managers have in determining pay?
• What is the role of Human Resources in compensation?
• How can you use communication to support employee engagement?