Why is salary management more challenging?

Salary management refers to the process applied by an organization to determine the bonuses, benefits structure, and compensation forms that all employees should receive for the services they provide. During this process, the enterprise makes decisions on the salary level, welfare system, allowance structure, and salary composition of special employee groups. Meanwhile, as an ongoing organizational process, the company must continue to develop compensation and recruitment plans.
Salary management is a challenge for any organization, mainly because the company’s salary management system needs to maintain a balance between fairness, effectiveness, and legality. There are increasingly more factors to consider when deciding on a salary system. In addition to the basic economic capacity of the enterprise and government laws and regulations, it also involves the enterprise’s strategy in different periods, internal talent positioning, external talent market and field competition, as well as the employer’s strategy.

What should salary management include?

A typical payroll is divided into four forms:

• Basic salary: The basic cash compensation paid by the employer for the workload undertaken by the employee, reflecting the value of skills or job difficulty. However, it may overlook individual differences among employees. Basic salary can be adjusted based on overall living standards or inflation, further enrichment of employee experience, improvement of employee performance, and enhancement of skills;
• Performance compensation: recognition of past work behavior and achievements. As a supplement to basic salary, performance-based pay is usually adjusted based on employee performance;
• Incentive pay: Incentive pay is also related to employee performance and is considered variable pay, including short-term and long-term incentive pay. Short term incentive compensation is usually applicable to specific performance situations, while long-term incentive compensation focuses on the organization’s long-term goals, such as employee returns, market share, and net asset returns.
• Other benefits: including holidays, work-related support (medical subsidies, employee cafeteria support, etc.), holiday rewards, and insurance. It is becoming increasingly popular and important in salary services.

Considering salary management for outsourcing companies?

Who should consider outsourcing salary management?

• There are many reasons why companies choose to outsource salary management and even the entire human resources department to third-party professional service providers. Generally speaking, the following types of companies are more willing to cooperate with payroll service agencies rather than establish their own internal teams:
• Start up companies or small and medium-sized enterprises: For a company that only employs a few dozen people, due to cost constraints, it is becoming increasingly difficult for them to hire their own human resources managers, especially when it comes to salary management. This may be a waste of time and bring more labor burden to the company’s operations.
• Overseas companies’ branches in China: When designing salary systems, it is important to consider local laws and regulations, which may differ from those in the country where the overseas headquarters is located. In this case, the company tends to collaborate with local institutions to better understand local requirements.
• Companies with high employee turnover rates: Retailers, insurance sales, and general labor industry companies can hire thousands of employees who work under different types of contracts, such as open-ended contracts, short-term contracts, long-term contracts, or just verbal agreements, which only a few compensation experts cannot solve. Collaborating with salary management agencies will help reduce costs.

What are the benefits of outsourcing salary management?

• When you choose to outsource salary management, you will find that you not only save a lot of money to hire internal employees to handle the entire system, but also save valuable time and energy to run the business and pursue success. You can also obtain real-time data and always check the progress of the following items:
• Enterprise management: Comprehensive integration of management and personnel demand information, multidimensional analysis, indicator evaluation, and multidimensional decision-making information to provide support for planning enterprise strategic goals;
• Human resources: comprehensively manage personnel, salary, attendance, scheduling and other related matters, assist enterprises in building management mechanisms based on business objectives, and formulate talent development strategies;
• Employee performance: Personal information and related statistical data are available at any time, including employee attendance, performance tracking, and development paths, to help you design appropriate improvement paths for employees;

What help can Simon provide for salary management?

Simon can help you handle the daily work of managing employees and representing your payroll system to save you time and budget.

• Calculate monthly salary, including basic salary, performance-based salary, and other benefits;
• Provide salary details, variance analysis reports, and salary accounting entries;
• Pay monthly salary to the employee’s bank account;
• Bank statements and transfer history records;
• Provide employees with a monthly salary breakdown table;
• Provide annual reports and appendices;
• The calculation of statutory welfare remuneration as stipulated by relevant laws and regulations;
• Prepare and submit employer tax declaration forms;

Why choose Simon?

Rapid Processing

With experienced team members, we can handle your project faster than others.

Unsuccessful, no charge

Simon promises that we will only charge after your project is successfully completed.

Tailored services

We will provide the most suitable business plan based on your situation.

Traceable process

Simon has an online system for you to track any updates to the project.

Frequently Asked Questions

Do you have any further questions? don’t worry! We are happy to answer!