Salary survey shows pay and benefits continue to improve

Citation

(1999), "Salary survey shows pay and benefits continue to improve", Leadership & Organization Development Journal, Vol. 20 No. 6. https://doi.org/10.1108/lodj.1999.02220fab.006

Salary survey shows pay and benefits continue to improve

Keywords Salaries, Benefits, Surveys

Merit, one of the leading independent recruitment consultancies operating in the South of England, has recently released the results of its latest salary and benefits survey. The research, which shows that salaries are rising above the rate of inflation and pay freezes are no longer in force, reflects industry-wide skills shortages.

Conducted annually for the last nine years, Merit's salary survey includes feedback from more than 200 companies operating in a wide range of sectors and spanning all job types.

Pay increases

Of the companies interviewed, 81 per cent had awarded their staff a salary rise, with increases averaging 3.96 per cent. None of the respondents reported a pay freeze, although 18 per cent advised that increases had been delayed. Interestingly, less than half of respondent companies (47 per cent) have set pay structures based on performance, profit share, position within the organization, local government scales and other grading systems.

Pay policy

Nearly three-quarters of the sample advised that their company pay structure is determined by market rates and therefore fluctuates according to the availability of skills in the market-place. Skills that are specialist or in limited supply command higher salaries or hourly rates.

A further 9 per cent said their company based its pay on the cost of living, 27 per cent on the performance of their staff and 64 per cent considered both these factors together.

Bonuses

Over half the sample (54 per cent) award annual bonuses to their staff. All the bonus schemes highlighted by respondents are profit related: 40 per cent of companies award 10 per cent of salary as a bonus; 20 per cent offer a 5 per cent bonus; 20 per cent pay 4 per cent and another 20 per cent have a 2 per cent bonus scheme.

Additionally, share options are offered by 37.5 per cent of companies and 39 per cent operate a profit share scheme.

Health and fitness

Although 71 per cent of respondent companies offer medical insurance, the terms on which it is provided varies greatly. Whilst 66 per cent provide cover for all their permanent employees, 20 per cent offer it only to managers and other senior personnel. Seven per cent provide health-care policies to employees who have worked for the company for a year or longer and another 7 per cent just to pension scheme members.

Of all companies surveyed, 13 per cent also operate a dental plan and nearly a third are so committed to the wellbeing of their staff that they offer sports or social facilities.

Pensions

Most companies (81 per cent) provide a pension scheme for all their permanent staff. The highest contribution level was 10.25 per cent of salary, made by 9 per cent of respondents. However, the majority (37 per cent) reported that they contribute 5 per cent of salary. Of the remainder, 18 per cent contribute 4 per cent; 9 per cent contribute 8.2 per cent; and another 9 per cent make contributions of 2.5 per cent.

Annual leave

The average annual holiday entitlement for employees who have been with the company between one and four years is 20 days (offered by 65 per cent of respondent organizations). After five years' service, 30 per cent of companies increase this to an average of 25 days leave. The maximum amount of leave available is 25 days (offered by 44 per cent) and 26 or more (offered by 39 per cent).

Nearly half (48 per cent) allow their staff to work flexi-hours.

Other benefits

An encouraging 62.5 per cent of companies contribute to the cost of educational courses undertaken by their employees and 39 per cent operate day-release schemes so staff can attend college.

Whilst 46 per cent of respondent organizations will help with relocation expenses, only 4 per cent offer mortgage subsidy options.

Companies are not yet supporting the Government in its bid to encourage people to abandon their cars in favour of other means of transport - the most common benefit offered by companies in the survey is free parking, which is provided by 96 per cent of the sample. However, only 4 per cent offer car loans.

None of the companies included in the sample has on-site creche facilities, although 4 per cent provide financial help with child care.

A copy of the report is available for £45.00. Contact: Merit Recruitment, Tel: 01256 471508.