Promotional Guidelines - WorldatWork

Promotional Guidelines

WorldatWork February 2015

About WorldatWork? ? The Total Rewards Association WorldatWork () is a nonprofit human resources association for professionals and organizations focused on compensation, benefits, work-life effectiveness and total rewards ? strategies to attract, motivate and retain an engaged and productive workforce. WorldatWork and its affiliates provide comprehensive education, certification, research, advocacy and community, enhancing careers of professionals and, ultimately, achieving better results for the organizations they serve. WorldatWork has more than 65,000 members and subscribers worldwide; 95 percent of Fortune 500 companies employ a WorldatWork member. Founded in 1955, WorldaWork is affiliated with more than 70 local human resources associations and has offices in Scottsdale, Ariz., and Washington, D.C.

WorldatWork Society of Certified Professionals? is the certifying body for six prestigious designations: the Certified Compensation Professional? (CCP?), Certified Benefits Professional? (CBP), Global Remuneration Professional (GRP?), Work-Life Certified Professional? (WLCP?), Certified Sales Compensation Professional (CSCP)TM and Certified Executive Compensation Professional (CECP)TM.

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Introduction & Methodology

This report summarizes the results of a November 2014 survey of WorldatWork members to gather information about current trends in promotional guidelines. This survey focuses on a variety of practices and policies, including what employers consider to be promotions as well as the standard pay increases that often accompany promotions.

On Nov. 12, 2014, survey invitations were sent electronically to 4,989 WorldatWork members. Randomly selected members had designated compensation only or compensation and benefits as their primary job function in their WorldatWork member profile. The survey closed on Dec. 12, 2014, with 541 responses, an 11% response rate. The dataset was cleaned, resulting in a final dataset of 443 responses.

In order to provide the most accurate data possible, the data was cleaned and analyzed using statistical software. Any duplicate records were removed. Data comparisons with any relevant, statistically significant differences are noted within this report.

The demographics of the survey sample and the respondents are similar to the WorldatWork membership as a whole. The typical WorldatWork member works at the managerial level or higher in the headquarters of a large company in North America.

The frequencies or response distributions listed in the report show the number of times or percentage of times a value appears in a dataset. Due to rounding, frequencies of data responses provided in this survey may not total exactly 100%.

WorldatWork conducted similar promotional guidelines surveys in 2012, 2010 and 2006. The reports can be viewed on the WorldatWork website. Many historical comparisons from 2012 and 2010 are illustrated in this report; however, the 2006 data is not shown in this report due to various changes in questions and limited space. Please visit the WorldatWork website to view the 2006 data in its entirety.

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Table of Figures

Demographics

Figure 1: Sector ................................................................................................................................................ 4 Figure 2: Organization size .............................................................................................................................. 4 Figure 3: Industry ............................................................................................................................................. 5 Figure 4: Region............................................................................................................................................... 5

Definition of Promotion

Figure 5: Promotion definitions and criteria ................................................................................................... 9

Size and Determination of Promotional Increases

Figure 6: Average promotional increase ......................................................................................................... 9 Figure 7: Influential factor(s) in determining rates of promotional increase .................................................. 10

Number of Promotions

Figure 8: Percentage of employees promoted .................................................................................................. 10

Funding of Promotional Increases

Figure 9: Funding of promotional increases..................................................................................................... 11 Figure 10: Size limitation on promotional increases ........................................................................................ 11 Figure 11: Maximum amount of promotional increases .................................................................................. 12

Communicating Promotional Guidelines

Figure 12: Communication of promotional guidelines or policies................................................................... 12

Position Movement

Figure 13: Limitations on grades, levels or bands employees are permitted to move ..................................... 13 Figure 14: Number of grades, bands or levels an employee can move in one promotion ............................... 13 Figure 15: Employee eligibility for an increase when moving laterally .......................................................... 14

Effect of Promotions on Merit Increases and Variable Pay Awards

Figure 16: Management of merit increases for promoted employees ............................................................. 14

Timing and Frequency

Figure 17: When promotions occur.................................................................................................................. 15 Figure 18: Promotion eligibility after an employee is hired............................................................................. 15 Figure 19: Frequency of employee eligibility for a promotion ........................................................................ 16 Figure 20: Calculation of bonuses or incentives after a promotion ................................................................. 17

Promotional Opportunities and Employee Motivation

Figure 21: Promotional opportunities to attract new employees...................................................................... 17 Figure 22: Effect on employee engagement and motivation............................................................................ 18

Global Practices

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Figure 23: Promotional guidelines or policies designed and administered by global regions ......................... 19 Figure 24: Consistency of promotional guidelines or policies by global regions ............................................ 19

Additional Analysis Comparisons by Sector

Figure 25: Organization sector, by percentage of employees promoted .......................................................... 20

Comparisons by Effect of Promotional Opportunities on Employee Engagement

Figure 26: Communication approach of promotional guidelines or policy, by effect on employee engagement ...................................................................................................................................................... 21

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