FOCUS ON: RECRUITMENT & HR


Pay the right amount When it comes to attracting and retaining staff, money is not the be all and end all. However, it is useful to know what the going rate is for particular jobs in the area in which you are operating. Pay too little and you may lose important members of the team, pay too much and you could be losing potential profits. While obtaining your salary information by word of mouth is useful, Karl Ellis, director of Essential Benchmarking and Reward Solutions, applies a more scientific approach.


“Paying the going rate makes sense. If you pay a good member of staff at a lower rate they might be tempted by another business offering the correct amount and so the short term gain of spending less on a salary will be


outweighed by the cost of recruitment of a new person who will probably demand the market rate anyway,” said Karl. Many companies will have frozen their salary levels over the last few years whilst others will still have provided modest increases. As we emerge from recession it will be necessary to review pay scales because a significant difference may have grown up between businesses in the same sector and even in the same place. Karl says: “There are many issues that have to be taken into account.


Well established businesses may be able to pay less than the average because of their strong reputation and potential opportunities for career advancement, whereas a new company might have to pay above the market rate to attract staff who consider they are taking a risk. “Other rewards can also have a big part to play, such as free car parking, holiday entitlement, medical cover, pensions and so forth. But


‘Careful thought has to be given to the way staff are rewarded because the consequences of getting it wrong could be costly’


you have to be careful with other more unusual benefits, such as offering things like Indian head massages. This can rebound if they don’t fit your organisation’s culture and are not widely taken up. The people who don’t get involved can become irritated at what they perceive to be a waste of money which would have been better spent in other ways.”


Businesses need to devise a strategic approach to recruitment and retention. It makes sense to forge good relations with local schools, colleges and universities and to consider apprenticeship schemes so that young talent can be identified and attracted. At the same time it would be a mistake to overlook people at the other end of their careers because they can still make a contribution. Above all, careful thought has to be given to the way staff are rewarded because the consequences of getting it wrong could be costly.


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14 Business West Update SEPTEMBER/OCTOBER 2011


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