A production company active in the B2B business with around 400 employees had set itself the goal of adapting its remuneration management in order to become more attractive to applicants and employees. The company is bound by collective agreements and has a works council. It has a wide range of products and variants with a high level of vertical integration and a low degree of automation.
Building sustainable and competitive pay management
As an entrepreneur, you are always faced with the question of what is the right pay for a job, what meets the requirements, what is in line with the market and what is plausible in an internal comparison. Employees ask themselves whether they are being paid appropriately, whether the pay is fair and just. This is exactly where the remuneration management project came in: The employer had the impression that his payment logic was not sustainable. The employees had had this feeling for some time.
The interim manager was tasked with designing a new remuneration model. The task was to take stock of all activities, draw up an internal and external pay comparison, design a new pay model and prepare it for introduction. A project capacity of 25 days was planned over a period of 3 months.
Recording and evaluating requirements profiles for more than 130 activities
The activities in the company are very heterogeneous. As a result, more than 130 different jobs were documented with the corresponding requirement profiles. The interim manager first set about organizing the task and job descriptions according to the criteria of the Geneva Scheme. In the next stage of the project, he also focused on the foreseeable future requirements. He identified which qualifications would be required in the future, why and where, and what would need to be done to ensure that employees were suitably qualified. Finally, the interim manager agreed the new job descriptions with the managers.
Current job classifications reviewed and provided with correction notes
On this basis, the interim manager reviewed the current job classification practices and provided them with correction notes in most cases. He used collective bargaining systems from the major German industrial sectors (chemicals, metal, electrical) as an external benchmark because their levels influence applicant behavior and are often cited by employees as a reference.
Modified pay management creates more clarity and transparency
He then developed a modified pay management system based on the collective bargaining agreement that creates more clarity and transparency. The job evaluations are carried out in a summary system.
The interim manager quickly reached an agreement with the works council to introduce the improved system for the employees together with the parties to the collective agreement. The works council itself is not a direct negotiating partner in this matter in accordance with the Collective Agreement and Works Constitution Act. The final drafting of the necessary documents is therefore the responsibility of the parties to the collective agreement. This step was then taken promptly, meaning that the company has now become more attractive for employees.
