Best Compensation Management Software - Page 2

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Researched and written by Grace Savides

Compensation management software helps organizations plan and administer employee compensation packages. Sometimes known as compensation planning or compensation solutions, the software manages salaries through an administrative dashboard or data visualization, develops merit matrices, and reports on company compensation data. Organizations use compensation management software to view and adjust compensation policies, plan employee bonuses and structure incentives, and recommend pay adjustments. HR departments most commonly implement compensation management systems, enabling managers to develop streamlined compensation strategies for their teams. That way, organizations can ensure equitable employee compensation and optimize salary budgets.

Compensation management software can be implemented either as a standalone solution or as part of an integrated HRMS & HCM software. Many compensation management systems integrate with performance management software to incorporate employee performance data into compensation decisions. Some compensation management products offered as part of a suite may include capabilities from sales compensation software.

While basic compensation management software focuses on budgeting and bonus structures, more robust systems also include salary benchmarking features that allow users to compare salary data across the industry and see where performers are being paid above or below certain salary bands. This may also include or integrate with pay equity software, allowing administrators to break down information by certain demographics and protected identities to ensure fair payment across an organization and mitigate legal risk from lack of compliance.

To qualify for inclusion in the Compensation Management category, a product must: