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Compensation Philosophy Guide A compensation philosophy, sometimes referred to as a pay philosophy or remuneration policy, is an ideology or policy statement outlining an organization's core beliefs and values regarding why and how it rewards employees.

Most compensation professionals understand the importance of basing the geographic differentials on cost of labor, rather than cost of living.

Amanda Garcia Compensation Manager Southwest Research Institute CCP®, GRP® Read Bio Andrew Welt Senior Vice President, Rewards Consulting Practice Leader Fidelity Investments Workplace Consulting CCP® Read Bio Brandon Staheli Compensation Consultant Employers Council CCP®, GRP®, CBP® Read Bio Catherine (Cathy) Peffen Principal CMP Consulting, LLC

Done right, a compensation plan should serve to achieve competitive advantage and improve the return on investment in executive compensation.

Save Reuse Permission Sales compensation costs are on the rise.

CCOS is often in the range of 7% to 10% of revenue for B2B companies (but will vary by industry, company size and go-to-market model).; CCOS at Forecast When sales compensation practitioners develop their annual sales compensation plans, they conduct careful financial modeling to ensure the new plan pays ~100% of the sales compensation budget when the company achieves its sales forecast.

Editor’s Note: Additional Content For more information and resources related to this article, see the pages below, which offer quick access to all WorldatWork content on these topics: ;Employee Compensation; ;Organizational Performance; ;People Analytics; ;Total Rewards; #1 Total Rewards & Comp Newsletter Subscribe to Workspan Weekly and always get the latest news on compensation and Total Rewards delivered directly to you.

Save Reuse Permission Editor’s Note: Workspan Daily will be reproducing a monthly Compensation Café blog post for the benefit of our readers and to encourage further discourse on topics vital to compensation professionals.

Employee Compensation Survey Results This study delves into key compensation issues, including: the prevalence of base pay structures, the percentage of organizations with jobs that pay near the minimum wage, the degree to which multinational corporations vary their compensation approaches from one nation to another, and more.

When reviewing a sales compensation plan, analyze the overall financial picture, how it is functioning and paying out against overall objectives and how the plan differentiates payouts between sales reps.