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How Important Is Salary Review


A timely and efficient salary review process can have a positive influence on a company's overall culture. Showing employees that employers acknowledge their value and offer a fair salary based on that value can increase employee morale and trust in the company.What is a salary review?


A salary review is the evaluation process that managers conduct to determine if employees’ salaries fairly and accurately reflect their work performances.

A thorough salary review depends on these factors:

  • Employee work performance or performance review results

  • Position

  • Employe value in the external job market

  • Designated compensation budget


Why should HR leaders care about salary reviews?

Salary reviews offer employees the chance to receive compensation that matches their work performance. Salary reviews can also improve employee:

  • Retention

  • Engagement

  • Productivity

  • Work performance


Why are salary reviews important?

There are several benefits of conducting and participating in salary reviews. Some of these benefits include:

  • Provides the opportunity to receive compensation aligned with their performance

  • Offers the ability to keep high-performing employees and work with those who are performing less than expected

  • Allows employees to express any concerns or ask questions related to their salary and role

  • Opens a channel of communication between employees and employers.

  • Helps improve employee morale by providing opportunities to acknowledge accomplishments


How do salary reviews affect company culture?

A timely and efficient salary review process can have a positive influence on a company’s overall culture. Showing employees that employers acknowledge their value and offer a fair salary based on that value can increase employee morale and trust in the company. It can also foster a better sense of loyalty among employees within the organization. The overall increased motivation that regular salary reviews bring can also help create a solid culture that encourages the growth of employees.

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