Everyone wants more money. But how do you know if you’re being paid enough in your current position? Google can usually tell you what the salary ranges are for a generic “hospitality staffing wages” search. But that’s only a basic glimpse into what criteria employers use to pay you. What are the other factors that come into play when determining an employee’s salary in the hospitality industry?
Understanding Pay Structures
The first place to start is to consider what you’re making now. Do you know the exact hourly rate you’re making? How much is coming out of your pay in taxes and benefits? Also, consider PTO, vacation or other benefits you have. This will help you figure out a more accurate figure of what your salary is.
Total employee compensation is more than the hourly or salary wage you’re making. It includes:
- Base wage or other financial compensation
- Recognition or non-financial compensation.
The base pay can be hourly or salary and it usually depends on the responsibilities and requirements of the job. Benefits can include insurance, educational opportunities, or other perks like signing or retention bonuses. Additionally, it can also include free meals or flex time. There are signs that hospitality employers are working to improve their benefits offering to attract more candidates into the field. But some of the typical benefits you might find include:
- Health, dental, vision insurance
- Life insurance
- Employee discounts
- Professional development
- Employee assistance programs
Some roles have commission or other performance-based bonuses. Non-monetary benefits can include anything that attracts or retain employees longer. Advancement is a key perk for employees. Other non-cash related benefits can include:
- Flexibility in the work schedule
- Transit passes
- Social activities
- Discounted or free meals
- Discounted or free uniforms
- Performance rewards like gift certificates or on-site discounts
- Health and wellness benefits
But how do employers figure out what rates to pay for the various jobs in the organization?
Employers take into account a variety of factors when determining pay scales. They can include:
- The cost of replacing employees. Churn is a big problem in the hospitality field, so employers may decide to pay more to help retain the best workers on the team. This could include performance bonuses for a job well done or opportunities to advance up the ladder to make more money.
- This can add to the cost of a new hire and employers may consider this when setting basic salary rates for employees.
- The availability of talent for a particular role. If the job requires special skills that not everyone has, the employer may pay higher because the candidate pool is thinner. The good news for workers these days is that unemployment is very low, so employers are considering higher financial compensation to attract all kinds of candidates, not just the ones with special skills.
There are a lot of considerations when establishing employee salaries. The best organizations constantly evaluate the wages, benefits, and perks offered to employees to keep their organization competitive. It’s a complex balancing act of creating an attractive package for workers while still balancing corporate profits.
If you believe your compensation package hasn’t been adequately prepared, talk to the expert hospitality recruiters at Gecko Hospitality. You have job options and we have opportunities available. It’s worth the call. We can help you get paid what you’re worth.