Setting a competitive salary and benefit package

Competitive salary and benefits remain the key criteria for choosing an ! employer. According to the 2015 Randstad Award report of more than 10,700 potential employees, it is the ‘most important factor’ for 20% of respondents, a 100% increase since 2012.

Two basic factors govern how much salary a role attracts: what skills are needed, which helps establish likely salary costs; and how that salary links to existing pay grades and/or negotiated agreements. If an organisation grades its jobs, the job band will be the starting point for establishing the salary (see chapter 16). You may also need to consider any trade union agreements.

Unless the salary and benefits package reflects market rates the vacancy is unlikely to attract interest. According to the CIPD almost 90% of organisations set their reward packages (base pay, performance pay and monetary benefits) in the median to top tenth of their sector, indicating that competitive pay is seen as the most likely method to both attract and retain employees.

ONS figures show average UK salaries rose by 2.2% in the year to May 2015, and are predicted to rise by 2.5% in 2015/16 although Randstad analysis reveals roles demanding scarce skills were offered at substantially higher rates. Information about salary rates can be found through the ONS, Incomes Data Services and XpertHR Surveys, by joining a pay club or conducting pay surveys with comparable organisations.

Randstad consultants can also advise on rates for specific roles at different levels of experience in your area using an online tool – based on more than 800,000 UK salary rates – to establish a simple but powerful salary benchmark for roles across a wide range of professions. However the employer approaches pay, under the Equality Act staff must be paid at the same rate for similar work or work of equal value regardless of gender.