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Balance your business by linking pay to company culture

In Culture, Talent, Teams - 3 months ago - 2 min

Balance your business by linking pay to company culture

Two thirds of employees believe they are paid unfairly. According to Pay Scale, the number one reason employees quit is due to unsatisfactory pay.

Employers and employees aren’t on the same wavelength when it comes to salaries. 73% of employers believe employees are paid fairly and 78% think they feel valued at work. In fact, only 45% of employees feel valued and 64% believe they’re paid fairly. Pay isn’t the only issue – communication is causing a rift between CEOs and their staff.

81% of employees said they would feel satisfied getting paid less than market value for work if their manager explained the reason behind the salary

The first step to bridging this chasm could be to introduce transparency around pay. 81% of employees said they would feel satisfied getting paid less than market value for work if their manager explained the reason behind the salary to them. Salary, as open communication, needs to be part of the company culture.

“The key is to understand you are dealing with human beings who work hard not simply because of financial incentives, but because of a whole host of other factors,” says Harvard Business School Professor, Deepak Malhotra.

Happy staff lead to a 12% spike in productivity and will boost a company’s growth and profits. The path to a positive working atmosphere is open communication, health focus, company activities, praising and achievements.

A study by Harvard colleagues showed the way employers pay employees is key to satisfaction in salary. The study found that those who are promised a rate of pay and then given a surprise bonus work 20% harder than those who are given the full amount (including the bonus) up front. Bonuses are important to how an employee feels towards their employer, their work and also how dedicated they are. The research shows employees work harder when they receive bonuses compared to when they don’t- no matter the rate of pay.

Read more in our infographic.

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