In these times of labour shortages, human resources professionals are trying to find creative solutions to retain and attract talent. At the end of last year, the French e-learning platform 360Learning published an article entitled “Why We Don’t Negotiate Salaries at 360 Learning“. Let’s take a look at this original practice.
When it comes to annual interviews, our salaries are calculated, not negotiated. And our laws are completely transparent,” writes Nicholas Wagner, 360Learning’s Chief People & Culture Officer.
This practice has 4 merits according to him:
– Greater employee empowerment
– Less authority from leaders who can act more as coaches than as managers with salary leverage
– No bias: people who are less good at negotiating are no longer harmed
– Greater simplicity
On this last point, the HR expert for the past twenty years points out the considerable time savings of this process:
Certainly not for me who has to build the model! But for the employees and the coaches who avoid numerous discussions that are not very productive. In one hour, it’s settled. In fact, I used to notice that people liked to have coffee with me in November and December. This year, I’ve had far fewer”.
Implemented since January 2021, this model works on the principle of progression levels. This level, attached to the person, is assigned upon hiring. It is non-negotiable and is visible to the entire company. At 360Learning, there are 8 levels, each with an intermediate step… making a total of 16 levels.
What does the level have to do with salary?
Simply put, it’s a salary scale… designed to be at the top end of the technology talent market. The latter is determined through market research purchased by companies specializing in the field and updated annually. Both geographically (market in France, US, UK etc.) and functionally (sales, commercial, tech, etc.).
A concrete example based on the table below for US-based employees: if you have a 4.5 level, your offer cannot be below $200,000 per year (with 50% variable) and can go up to $216,000 maximum. This $16,000 is a small negotiation margin.
Every year, compensation reviews are held to review the employee’s position in the company. This is based on 3 factors:
– the employee’s current level. Knowing that, twice a year, they can raise their hand to be evaluated and pass an additional level
– The performance, obviously, measured every quarter
– the current salary
All of these factors are then put together in an increase matrix, which is:
Note that the figures in this matrix are defined in advance by the company’s budget. So as not to spend money it doesn’t have! Thus, each employee, knowing his of her level and performance, can simulate his or her own increase.
I see only advantages. It generates a lot of trust within the teams and towards the organization,” says Nicholas Wagner.
Negotiation could potentially shift to setting the level of each person. But the way they are set, with lots of cross-reviews and full transparency to the rest of the company, makes this process relatively fair, he says.
So, are you ready for the end of salary negotiations?
