Salary reviews

Jan. 1, 2006
The new year is a good time to review team members’ contributions and how they have supported the practice’s vision and goals, and to award deserved and affordable raises.

The new year is a good time to review team members’ contributions and how they have supported the practice’s vision and goals, and to award deserved and affordable raises. Last month, we discussed growth conferences, which are one-on-ozne meetings with staff members to recognize strengths and achievements and set goals for new challenges. Ten to 12 months after the conference, assess how well team members met their goals and demonstrated new skills, and reward their accomplishments with appropriate raises.

If you set clear, agreed-upon benchmarks at the growth conference and share feedback with team members all year, your salary review is simply a wrap-up of what has transpired. It should contain no surprises or shocks for either doctor or team member.

Here’s how to conduct salary reviews that are affordable and based on demonstrated knowledge, skills, and abilities:

1) Determine the practice’s collections increase for the past year.

2) Create a salary pool based on a percentage of this collections increase (10, 15, or 20 percent is the norm).For example, if your practice collected $65,000 more than in the previous year, and you want to allocate 15 percent as a pool for staff raises, you have $9,750 to spend.

3) Review each employee’s growth conference and job description and your practice’s philosophy statement.Sort each employee’s competencies into three categories: 1) job specific skills (familiar with all aspects of their goals, performs excellent, accurate, efficient, and consistent work); 2) teamwork skills (collaborative, communicative, gives and receives feedback, cross-trains); and 3) practice-management skills (understands practice vision, supports it through daily actions, takes initiative in resolving system or patient problems, recognizes role in the big picture). Using a system similar to ours, assign a value for success in each category. This will help determine what percentage of the salary pool each employee merits.

4) Complete a performance review worksheet. Em-ployees need to see in writing if they have met, not met, or exceeded their goals in each category (job-specific, teamwork, and practice-management skills). The performance review worksheet determines this. At the salary review, share this worksheet with employees. It serves as a performance appraisal and justifies your decisions about what level of salary increase is warranted.

5) Create an employee compensation worksheet. This contains an itemized account of the total benefits package and its dollar value for the employee’s current and new compensation. The salary review is an excellent opportunity to educate employees about the value of their compensation package. Many employees don’t recognize the worth of benefits such as vacations, sick days, and Social Security contributions because that worth is seldom discussed. One way to help staff visualize the value of these benefits is to incorporate it into a worksheet.

6) Schedule a 30-minute salary review with each staff member to discuss the performance review worksheet and employee compensation worksheet. Begin the sal-ary review with an analysis of the action plan. Explain that your decision regarding the employee’s raise was based on these agreed-upon goals. Discuss the specific goals and how effectively the team member met them. Acknowledge the team member’s contribution with the raise you have determined. Ask the person for his or her thoughts, as well. Then schedule the next growth conference to review accomplishments and set goals for the upcoming year.

With this method, the guesswork and arbitrariness are taken out of salary increases. You can rest assured that raises are fair, affordable, and motivating. This method gives your staff control over their compensation and encourages them to grow in their jobs. It’s all up to you as the leader!

Amy Morgan is CEO and lead trainer of Pride Institute, the practice-management firm helping dentists better their lives by mastering the business side of their practices. For more information on staff motivation, order Pride’s workbook/CD training resource, “Take Pride in What You Pay.” For information on Pride’s seminars, training materials, transition services, and management programs, or to ask Amy a question for this column, call (800) 925-2600 or visit

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