Four Reasons Why to Implement Employee Compensation Software

With all of the responsibilities that fall under HR, it’s easy to see how day-to-day tasks can often become overwhelming. Now, with the advent of multiple HR management software options, deciding on which tools to implement or purchase can end up being just as frustrating.

Instead of wasting time trying to pick the perfect option or choosing to go without any software at all, it’s time to make a case for why you should be embracing the latest HR tools and technology. By understanding how modern software can help you streamline tasks, you can make an informed decision based on what’s best for your business.

Paying Attention to Retention
Many studies show that when a business loses an employee, it can cost them anywhere from one to two times their salary! This number encompasses all of the costs incurred to attract and hire the individual, onboarding and training, as well as the impact on other employees and your customers. We also have to factor in the leaving employee’s length of employment as the longer they’ve worked at your company, the more knowledgeable and valuable they’ve become.

Taking all of these factors into account, compensation is the top motivational factor in retaining employees. That’s why it’s important to have a system in place to help you keep track of compensation for each employee. You should implement one that not only tracks salary, but bonuses and any stock options as well in order to match current compensation trends.

Avoiding Costly Errors
Many businesses still manually calculate compensation numbers for their employees. Whether they’re using a calculator or a sophisticated spreadsheet, keying in one wrong number could have expensive consequences. In fact, research shows that 33% of HR managers make mistakes when planning for compensation manually.

Any tool that you use could be susceptible to human error, and that’s why you should choose one that makes it easy to avoid or prevent such costly mistakes. By being able to incorporate guidelines and rules into your compensation tool, you can easily pinpoint and avoid costly errors.

Access to Decision-Making Data
When it comes to making crucial decisions about employee compensation, it’s essential to access the right data. After all, if you don’t have comparable data, your decisions are only based on an opinion. You could waste money because you’re paying staff too high instead of paying them right.

Anytime you’re determining compensation, you need access to internal, market, and historical data to make informed decisions. Your system should have the flexibility to configure your budget into decisions as well as create customized reports and analytics that compares existing employee and pre-hire information.

Stay Ahead of Compliance Rules
It’s no secret that compliance rules often change, which can create headaches for everyone on your HR team. And that’s not taking into account any changes that take place at the company level. Plus, you also have to consider differences depending on what state you’re located in. Not only is staying compliant important but avoiding the issue could lead to audits as well as expensive fines and penalties.

Any compensation tool you use should offer the ability to set rules and conditions to help you meet compliance standards. By being able to set rules to avoid issues with paying the correct minimum wage, avoiding age discrimination, and going over or under sat base salary amounts, you can prevent costly issues in the future.

Choosing a Tool That Fits Your Business Needs
As you can see, the compensation tool you choose should be robust and help you manage HR activity on all levels. You may even be thinking that this will require having to enact multiple systems to achieve maximum results and efficiency.

Thankfully, there’s one tool that’s flexible enough to handle all of the issues addressed above, regardless of how a company’s compensation plan is structured. With Compensation Cloud, you can easily manage compensation guidelines to retain employees, avoid costly errors, use key data to make more informed decisions, and stay in compliance with company, state, and federal rules. You can even configure rules and regulations to manage talent located in different countries.

With most compensation software, you would have to pay extra or wait for specific features to be built in. Compensation Cloud is easily customizable as a DIY software, so you can define your own variables using our template builders and rule engine, which is a unique algorithm you won’t find anywhere else. You’ll save time and money by being able to build even the most complex compensation plan in-house without hefty fees or delays.

Compensation Cloud offers users a modern design that’s easy to use with drag and drop functionality. In addition to incorporating many HR tools into one system, you have the flexibility to create and adjust your compensation rules, equations, and alerts to fit company needs as often as needed.

If you’d like to learn more about CompensationCloud or request a free demo, click here to contact us today.