OREANDA-NEWS. April 08, 2010. PricewaterhouseCoopers (PwC) presents the results of a survey of recent changes in HR practices, remuneration and benefits: “Changes in Salaries Survey”, held in February 2010 among financial and general industry sector companies.

Financial sector compensation survey

59 Russian and international financial institutions of various sizes and lines of business took part in the survey.

According to the survey results, the vast majority of respondents review salaries (98%). Slightly less than half of respondents (48%) held planned salary reviews from 1 June 2009 to 15 February 2010. Among companies that did not hold salary reviews during the above period, the majority (63%) planned to hold a review within the next few months, a further 20% of companies have not made a final decision, and only 17% of companies cancelled altogether holding a salary review. The average increase rate in companies that reviewed salaries or planned to hold salary reviews of each employee or a majority of its employees is 11%.

The majority of survey respondents (97%) have variable levels of pay. As of 15 February 2010, fewer than half of companies (42%) paid 2009 performance bonuses to their employees.

Among banks that did not pay bonuses, approximately half (42%) planned to make bonus payments in the next few months, a further 33% of respondents have still not made a final decision on bonuses, and only 15% of companies cancelled 2009 performance bonus payments altogether.

The majority (98%) of companies that have long-term incentive plans (LTIPs) (31% of total respondents) made or have planned to make payments under (LTIPs).

The majority of survey respondents (82%) have an annual employee performance appraisal system in place, with a further 9% of companies planning to introduce such a system. The individual goals and competencies appraisal prevails over other appraisal criteria for all categories of employees. 89% of respondents use appraisal results in salary reviews, 85% – in career promotion decisions and training and talent pool decisions (79% and 70%, respectively). The appraisal process in companies takes on average two months.

Changes in benefits generally took place with respect to medical insurance coverage of employees and their families, as well as sick leave pay in excess of statutory limits.

General industry sector compensation survey

43 companies from various sectors of the economy took part in this survey, including telecoms, automotive, transport, consumer goods and retail, and industrial companies.

According to the survey results, the vast majority of respondents review salaries (98%). Overall, less than a half of respondents held planned salary reviews from 1 June 2009 to 15 February 2010 (45%). Among companies that did not hold salary reviews during the above period (55%), the majority (57%) planned to hold a review within the next few months, a further 39% of respondents have not made a final decision, and only one company cancelled a salary review altogether. The average wage increase rate in companies that reviewed salaries (or planned to hold salary reviews of the majority of employees) is 8%.

All survey respondents have a variable pay system in place. Fewer than half of companies (44%) paid 2009 performance bonuses to their employees. Among respondents that did not pay bonuses (56%), the majority (79%) planned to make bonus payments in the next few months, a further 13% of respondents have not made a final decision on such payments, and only two companies cancelled 2009 performance bonus payments altogether.

All companies that have long-term incentive plans (30% of total respondents) made payments under LTIPs.

The majority of survey respondents (82%) have an annual employee performance appraisal system in place.  To appraise individual performances, companies almost to the same degree use the appraisal of individual goals, key performance indicators and competencies. 95% of respondents use appraisal results in salary reviews, 74% in employee training decisions and 72% in employee career promotion decisions. The appraisal process in companies takes on average two months.

Changes in benefits generally took place with respect to medical insurance coverage of employees, life and disability insurance, and meal allowances.