Compensation Review Guide
Before you jump into Compensation (“Comp”) Review let’s look at some key aspects of the process.
What is Comp Review?
The Comp Review may have various components:
Base Salary
There are primarily two types of salary increases:
Merit increases consider an employee’s performance and market compensation data
Promotion increases align pay with employee’s new promotional role
Target Incentive (e.g., commission)
Employees who are eligible for target incentives may be eligible to have their variable compensation (e.g., commission) opportunity reviewed
Not all eligible employees’ target incentive amounts will increase; factors considered are: performance, market data, and pay mix for the job
Equity Grant (if applicable)
Equity grants may be awarded to employees being promoted, as well as those who meet the eligibility criteria and are in good performance standing.
If applicable, Comp Reviewers will make equity grant decisions within the Equity Review; they will be provided with recommended grant amounts based on type of equity grant (i.e., Promotion or Refresh) and job level.
Making Compensation Recommendations
Base Salary Increases
Kamsa’s recommended increase guidelines are determined by company leadership and can be influenced by the company's pay philosophy, employee performance, and how their current pay aligns with market rates (i.e., compa-ratio).
When making pay decisions, consider:
Top performers – differentiate base salary increase amounts for high performing employees (e.g., allocate a greater % increase to recognize their performance).
Consider lower or no merit increase for employees who are new to the role and/or not yet meeting expectations of the role.
Refer to the salary increase recommendations that may vary based on employees’ performance rating and market competitiveness (i.e.., compa-ratio). Comp Reviewers will also need to factor in their budget.
For eligible employees with less than 1 year of service, Comp Reviewers may want to factor in their tenure to provide a lower percentage increase than the guidelines.
Equity Grants (if applicable)
Consider equity grants for employees being promoted as well as top performers.
Top performers - differentiate the grants based on performance (e.g., a high performer gets a higher refresh grant amount than a lower performer in the same job).