Employee Compensation Services
Organisations are under constant pressure to attract and retain talent, hence renumerating the talent rightly to stay ahead of the peers is essential. HR consulting firms have been constantly supporting their clients in evaluating the salaries and other benefits that should be paid to employees and help organisations understanding the industry standards. This report focuses on understanding the top service providers that organisations should engage with for compensation benchmarking services and the best practices while engaging with them.
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Employee Compensation Services Suppliers
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Employee Compensation Services market report transcript
Global Market Outlook on Employee Compensation Services
- The US-based employers typically source compensation benchmark data from the suppliers once in a year by participating in a suppliers survey
- As employers cannot hold the suppliers accountable for the data they provide, they are leveraging two to three surveys not only to arrive at the market value of the jobs, but also to avoid internal audit and compliance issues
- Crowdsourced pay data insights are extensively used by the employers not only as a supplement to the traditional/industrial survey insights, but also to understand employee perceptions
Insights On Crowdsourced Pay Data (Low Cost Service To Employers)
- As per a Willis Towers Watson survey on crowdsourced pay data, nearly 73% of the compensation professionals felt that the data obtained is unreliable and untrustworthy. This is because the crowdsourced pay data is skewed with too many variables and does not align to the job roles
- However, 71% of the HR professionals who leverage the crowdsourced pay data stated that it can be used as a supplement alongside traditional compensation survey reports
- The client can consider to consolidate its fragmented supply base to a minimum of three suppliers without compromising on the service quality
- For obtaining the consolidated supply base and to hold the supplier accountable for the data, the client should engage with one supplier from the leaders group on a SOW basis for all compensation consulting service needs
- The other two suppliers for market benchmark data services and crowdsourced pay data providers can be engaged from challengers and contenders group
- The US-based employers widely adopt FTE-based pricing model, when the service requirement is meant for a large group of employees. For example, salary auditing in line with the federal government requirements
- Per job title/role is adopted, when the service requirement is on ad-hoc basis and meant for a few job positions (i.e., customization). For example, executive determination for the newly identified leadership role
- Subscription-based pricing model is the another model practiced by employers to obtain compensation data from the traditional surveys
- Best-in-class organizations source compensation services (highlighted) along with end-to-end benefits administration from a single supplier not only to achieve monetary cost savings of about 10–20%, but also to implement the overall compensation strategy
- Cost savings (monetary) arises, due to the elimination of service duplication (such as policy designing, auditing, etc.) and service continuation from the same supplier under the defined contract terms
- HR consulting firms from the group were the prominent players to source the end-to-end benefits administration services