MHRM 6601 Week 9 Pay Structure Communication Plan Example

One Announcement, Three Audiences: A Communication Plan for Stone Arch's New Pay Structure That Briefs Managers First and Decides in Advance Which Figures Employees See

Student Name

Walden University

MHRM 6601: Benefits, Compensation, and Resource Allocation

Instructor Name

Month Day, Year

One Announcement, Three Audiences: A Communication Plan for Stone Arch's New Pay Structure That Briefs Managers First and Decides in Advance Which Figures Employees See

Purpose

On January 1, 2027, Stone Arch, the cooperative lender in the course case, introduces eight pay grades. About 65 employees will receive increases to reach a range minimum or a market adjustment. Six will be red-circled: their salaries hold, and future raises arrive as one-time payments. The remaining 159 or so will see new ranges and no immediate change. This plan sets out who hears what, in what order and with which figures.

Sequence

Table 1

Communication Sequence

Composite organization.

Messages by Group

Employees receiving increases will hear that their job was compared with the market and with other Stone Arch jobs, and that their pay is being brought into line. The message should not suggest they were underpaid through anyone's fault, which invites questions about back pay, but should be honest that the credit union's pay had fallen behind.

Red-circled employees hear first and in person. Their message is that their pay will not be cut, that it is above the range for their job because of past arrangements and that future increases will come as lump sums until the range catches up. Card et al. (2012) found that learning one's pay compared with peers affected satisfaction for those below the median but not for those above it, which suggests the red-circled group's main concern will be losing future raises rather than being singled out.

Everyone else hears that the structure gives them a visible range and a path to move through it, and that their pay is already within it.

Which Figures Employees See

Each employee will see their own grade, the minimum, midpoint and maximum of that grade, and where their pay falls in it. All employees will be able to see the full table of grades and ranges, and which jobs are in each grade. No one will see another employee's pay. This level of openness matches what research suggests: Bamberger and Belogolovsky (2010) found that pay secrecy lowered individual task performance, partly by weakening the perceived link between pay and performance. Smit and Montag-Smit (2019) found that employees vary in how much pay information they want to share and receive, which is why the plan publishes ranges but keeps individual pay private.

Preparing Managers

Managers will receive written answers to the ten questions most likely to be asked, including why a job is in its grade, how to move up and why a colleague received an increase. Any question a manager cannot answer goes to HR within two days.

Measuring Whether It Worked

A three-question pulse survey in February will ask whether employees understand their grade, whether they know how to move through the range and whether they think the structure is fair. Questions received by HR in December and January will be logged by theme.

References

Bamberger, P., & Belogolovsky, E. (2010). The impact of pay secrecy on individual task performance. Personnel Psychology, 63(4), 965-996. https://doi.org/10.1111/j.1744-6570.2010.01194.x

Card, D., Mas, A., Moretti, E., & Saez, E. (2012). Inequality at work: The effect of peer salaries on job satisfaction. American Economic Review, 102(6), 2981-3003. https://doi.org/10.1257/aer.102.6.2981

Smit, B. W., & Montag-Smit, T. (2019). The pay transparency dilemma: Development and validation of the Pay Information Exchange Preferences Scale. Journal of Applied Psychology, 104(4), 537-558. https://doi.org/10.1037/apl0000355