Credit Union Compensation

• Competitive market studies
  
• Salary administration
  
• Executive compensation
  
• Performance management
  
• Incentive compensation
  
• Sales compensation
  
• Deferred compensation arrangements
  
• Employment and change of control agreements
  

Case Studies:

Case Study #1: Salary Administration Program / Competitive Benefit Study

• Tired of the “usual” players, and wanted fresh eyes
  
• Concerned regarding credibility of compensation process
  
• Turnover was increasing and compensation was often the issue
  
• Utilized the step rate pay system for determining salary increases and grade assignments were tied to seniority
  
• Desire to move to a pay-for-performance program
  
• Often provided salary increases to employees in which performance did not warrant an increase
  
• Desired to develop a market pricing designed program to attract and retain employees
  
• Policies and procedures to handle compensation issues were not current or clearly defined
  
• Benefit Plans had not been compared to market practices in many years
  

• Adopted a Compensation Philosophy that emphasized a market driven approach for salary administration
  
• Market priced all positions based on a market driven approach
  
• Developed appropriate salary structures for various employee groups
  
• Compensated employees at the competitive market levels
  
• Provided increases to employees that were tied to performance
  
• Developed salary administration guidelines and procedures to ensure consistency
  
• Communicated with employees regarding the new program
  
• Provided a detailed Benefit Practices Study with recommendations for improvement, where necessary
  

Case Study #2: Executive Compensation / Salary Administration Program / Incentive Compensation

• Credit Union experienced a great deal of growth in the past couple of years
  
• Board of Directors wanted to align total compensation package for Senior Management with competitive market
  
• Board wished to implement formal incentive compensation program, including short- and long-term incentive awards
  
• Wanted to tie incentive awards to demonstrable awards
  
• Current sales incentive plans had questionable relationship between goal achievement and appropriate payout
  
• Desired to streamline sales compensation process
  
• Needed to focus sales incentives on definitive results
  
• Compensation levels were not aligned with the competitive market
  
• Provide rewards based on individual and team-related performance
  
• Compression occurred between new hires and experienced employees
  
• Desire to develop a market pricing designed program to attract and retain employees
  
• Pay-for-performance not actively used to determine increases and bonuses
  
• No salary structures were in place
  
• No formal policies and procedures existed to handle compensation issues
  

• Interviewed Board members in order to understand the organization’s culture, and confirm their position on compensation
  
• Interviewed executives to fully understand their duties and responsibilities
  
• Adopted a Compensation Philosophy that emphasized a market driven approach for salary administration and integrated sales compensation with the business objectives and marketing direction for the Credit Union
  
• Conducted a market analysis to determine the competitive market utilizing published survey data
  
• Developed appropriate salary grades and ranges for all employees
  
• Developed salary administration guidelines and procedures to ensure consistency
  
• Communicated with employees regarding the new program
  
• Provided recommendations to the Board regarding base salary, annual incentives, and long-term incentives
  
• Designed the plan documents covering the short- and long-term incentive programs, and assisted with each program’s on-going implementation
  
• Designed sales incentives based on desired mix of fixed and variable compensation
  
• Developed sales compensation guidelines and procedures to ensure consistency