Compensation Manager Job Description, Skills, and Salary
Get to know about the duties, responsibilities, qualifications, and skills requirements of a compensation manager. You can use our job description template in this article to produce your own. We also provide you with information about the salary you can earn as a compensation manager.
Who is a Compensation Manager?
A Compensation Manager is also known as a Benefits manager who is responsible for planning, drafting, and coordinating a company’s benefits packages. It is highly paramount that employees are compensated for the work they have done, it is the responsibility of companies to compensate their staff to motivate the staff to produce more output. They work closely with the human resources unit in the company to evaluate existing benefits and also draft company compensation-related policies and also guarantee that this company adheres to the current legislation.
Compensation managers are responsible for making research and establishing and maintain maintaining the pay system. For them to achieve this, they must research and comprehend the competitive market trends for employee benefits and wages. A compensation manager must look for ways to guarantee that the pay rates are standard and equitable to retain excellent employees and also recruit new employees.
As a member of the Human Resources department, a compensation manager ensures that the executive teams, HR leaders, and other managers in the company get all the information they need to make excellent decisions about an organization’s benefits programs and pay policies. They are responsible for executing the overall strategies of compensation programs.
Compensation Manager Job Description
Below are the compensation manager job description examples you can use to develop your resume or write a job description for your employee. Employers can also use it to sieve out job seekers when choosing candidates for interviews.
The following are the duties and responsibilities of a Compensation Manager:
- Experimenting and setting pay scales, which define the minimum, midpoint, and maximum salary for different job titles
- Ascertaining pay structure and compensation programs, which provide blueprints for how employees are compensated across an organization
- Supervising the operational process to determine annual merit raises, bonuses, and promotions
- Examining whether cost-of-living adjustments- across-the-board boosts in pay to address inflation- are required
- Funding the development of job descriptions and proposing fair and competitive compensation for positions based on their duties and responsibilities, the level of education required, and the market rate for the job, among other factors
- Giving the relevant financial data as organizations pull together benefits packages, including retirement plans and health insurance
- Staying abreast of local, state, and federal employment laws that connect to compensation, including emerging laws that cover pay equity and ban employers from asking job candidates about their salary history
- Supervising the distribution of pay to employees
- Helping managers to help develop promotions and retention strategies for existing employees
- Formulating a departmental budget and keeping operations within the budget
- Supervising compensation and payroll support team
- Conveying with third-party services to negotiate benefits plans and resolve benefits-related issues
- Funding the HR team with recruitment and talent management activities
- Formulating profit-sharing incentives, employee wellness, and performance management programs
- Organizing subordinate HR employees and daily operations related to compensation and benefits activities
- Readying reports and presentations
- Proposing changes to benefits packages to improve recruitment and retention rates within the organization
- Arranging new employee benefits plans or reviewing existing ones to ensure compliance with legal requirements
- Supervising payroll functions such as processing new hires, terminating employees, and updating records in human resources systems
- Examining employee performance appraisals and conducting performance management meetings with employees who need improvement.
There are several qualifications required to become a compensation manager which is:
Education: Compensation managers need to possess a bachelor’s degree in Human Resources, Business Administration, or any other related discipline. Some employers may give preference to candidates who possess a master’s degree in Business Administration with a concentration in human resources.
Training & Experience: Compensation Managers typically need to be trained so that they can be competent hires. The duration of training can be for a few months and they are usually under a supervisor that will teach them how to complete tasks on their own. Compensation managers who pursue an advanced degree can receive additional training because this is a managerial role. training can come in form of voluntary or paid internships. They need to possess at least five years of experience as a compensation manager and experience in a relevant field can be considered. They need to also have extensive knowledge of benefits and compensation programs, procedures, policies, and applicable legislation. They need to also possess experience in managing benefits and compensation in a Human Resources Information System (HRIS).
Certifications & Licenses: They can also acquire specific certifications to enhance their skills and showcase their qualifications to current and potential employers. To get certified, you may need to pass. You can be part of a professional body such as the Society for Human Resource Management.
- Negotiation Skills: Compensation managers need to negotiate with other departments and other key managers in the organization to ensure that compensation plans meet up with the company’s goals and objectives. For instance, if a manager wants to increase a newly recruited employee’s salary, he or she must first ensure that it complies with the standard of the company. He also needs to work closely with the compensation manager to execute the salary increase. Negotiation skills can also enable you to work with employees to draft compensation plans in relation to their needs.
- Technical Knowledge: Compensation managers need to have technical knowledge of laws and regulations that affect the compensation of employees. They need to comprehend how to interpret and calculate data to guarantee that employees are being paid fairly. They need to also understand how to interpret employee contracts in a way that employees can understand and follow up with the process.
- Communication Skills: Compensation managers need to communicate with different people in the course of their day-to-day activities. They need to communicate with employees, managers, and other executive board members to deliberate on the salary, negotiation strategies, and also other compensation-related topics before executing them. Effective communication skills can help them pass across a message concisely and vividly.
- Problem-solving: Compensation managers are responsible for drafting or preparing employee compensation plans. This involves evaluating employee data and also ascertaining the best strategy to compensate employees. Problem-solving skills can help compensation managers to come up with excellent decisions when drafting compensation plans. You must also employ your problem-solving skills to find solutions to challenges that may spring up during a compensation process.
- Leadership Skills: Compensation Managers are responsible for supervising the entire compensation process for an organization. This includes that they manage the compensation team and also supervising the compensation procedure of an organization. Leadership skills are very much crucial for compensation managers because this is a managerial role. Compensation managers are usually the ones responsible for leading a team of compensation experts.
- Mathematics Skills: Compensation managers must be very much familiar and comfortable with numbers for them to analyze data about an organization’s compensation, market rates, benefits package, and the need of growing and expand a business. They are also responsible for making recommendations to other departmental managers, HR leaders, and other executives of the organization.
- Analytical Skills: Compensation managers must also be able to evaluate the database on the necessity of the company. For instance, salary levels differ across companies and this is a result of the company’s goals and missions. Another illustration is that software developers will be paid more money because they play an essential role in the company. Compensation managers need to have an extensive comprehension of different departments and also job titles across the company. You need to understand marketing, administrative responsibilities, and IT to fit in perfectly into the role.
How to Become a Compensation Manager
- Get the basic Education
The first step to becoming a compensation manager is to acquire a bachelor’s degree in Business Administration, Human Resources, Social Sciences, Psychology, or any related field. Some employers demand that candidates get a master’s degree in Human Resources or Business Administration. The most essential thing is to possess the requisite skills to fit into the role perfectly. Most employers give preference to candidates who have five years of working experience in the HR department on recruitment, analyzing salaries and benefits for new hires which can build a compensation manager to have a good career path.
- Get Working Experience
You can get work experience in a related field to make you qualified for the job. Compensation managers can specialize in compensation or benefits although this depends on the experience they have acquired. They need to acquire working experience in the human resources field, management, or finance for them to fit into the role perfectly.
- Get Certified and Join a Network of Professionals
The next crucial stage is to get certified to prove to your employers that you are competent for the job. Certifications sometimes demand that you write and pass. You can get the following certifications as a compensation manager:
- Certification Compensation Professional (CCP) is for US-is based professionals and also Global Remuneration Professional (GRP) is for individuals around the world. It is offered at WorldatWork. It is a nonprofit organization that aids in establishing a compensation practice that boosts employee experience.
- Certified Employee Benefits Specialist (CEBS) and Compensation Management Specialist (CMS) offered by the International Foundation of Employee Benefits Plans. This is also another nonprofit that concentrates on employee benefits.
In addition, you can also join a network of professionals where you can get to interact with other compensation managers about how to compensate employees as expected. It is very paramount to understand that different companies have diverse ways they compensate their employees.
- Build your Skills
A compensation manager must build his or her skills to carry out his or her responsibility as expected. A compensation manager should build the following skills: Analytical Skills, Business skills, communication, decision-making skills, and leadership skills. Once you have built your skills; you can draft your resume and highlight the skills that you possess to attract employers.
Where to Work as a Compensation Manager Work
A compensation manager usually works in the office both at regular hours and during business hours, although they also travel to different locations to meet clients and attend conferences. They employ most of their time working with computers, preparing reports, and also making research on data. Compensation managers must also be able to work under pressure because their work can be tedious for them to meet up with the required deadline. They must possess mathematical skills to give their client what they want. They must also be able to convey their findings to both clients and management. A compensation manager can work in virtually every industry. They can work in the following places:
- Management of companies and enterprises
- Professional, scientific and technical services
- Insurance carriers and related activities
- Government agencies
- Healthcare and social assistance
Compensation Manager Salary Scale
The salary of a compensation manager varies across countries and here are some countries:
- In the United States, The average compensation manager salary in the USA is $103,262 per year or $52.96 per hour. Entry-level positions start their positions at $81,195 per year while most competent workers make up to $140,000 per year. The average compensation manager salary in Colorado is $112,965 per year or $57.93 per hour. Entry-level positions start their career at $98,439 per year while most competent workers make up to $143,675 per year. The average compensation manager salary in Connecticut is $115,650 per year or $59.31 per hour. Entry-level positions start their career at $98,644 per year while most competent workers make up to $140,000 per year
- In the United Kingdom, The average pay for a Compensation Manager is £91,412 a year and £44 an hour in London, United Kingdom. The average salary range for a Compensation Manager is between £62,343 and £111,797. On average, a Bachelor’s Degree is the highest level of qualification for a Compensation Manager
- In Canada, The average compensation manager salary in Canada is $99,500 per year or $51.03 per hour. Entry-level positions start at $76,263 per year, while most competent workers make up to $122,685 per year.
- In Australia, The average compensation manager salary in Australia is $115,187 per year or $59.07 per hour. Entry-level positions start at $90,000 per year, while most competent workers make up to $149,936 per year.
- In Ireland, The average compensation manager’s salary in Ireland is €55,000 per year or € 28.21 per hour. Entry-level positions start their career at €40,000 per year, while most competent workers make up to €80,000 per year.