In every company, nonprofit and government organization, employees get paid a certain amount of money. Their salary or hourly wage is determined in part by their superiors in their given departments, but it is also largely calculated by the organization's personnel or human resource department. Within the human resource department, the compensation specialist is the individual who is responsible for coming up with salaries, hourly wages and entire benefits and compensation packages. A compensation specialist can also be an outside consultant brought in to assist the human resource department.
The compensation specialist in the basic sense is the human resource professional who sets up how employees at various levels in the corporate structure get paid. For instance, the specialist can determine what a department supervisor gets paid versus what an upper level manager gets paid. The various pay grades are calculated, not only with salary in mind, but employee benefits, retirement assistance, travel allowances, company car and other perks and benefits. The specialist can also be part of the team that writes the actual job descriptions for these department supervisors and upper level managers, for instance.
Ultimately, the compensation specialist's goal is to make sure that the employer is not spending too much on any given employee. The other side of the issue, though, is to ensure that the employer is not underpaying any of its employees. By not giving talented employees the compensation they deserve, the employer could run the risk that those employees will seek jobs elsewhere. The compensation specialist must balance the pay structure with an actual budget too, for each given department and company unit.
This task can be done in several ways. Within the company, the compensation specialist can help to establish a review system. Talented personnel can then be recognized and rewarded. The specialist can also work with managers in the human resource department and executives in the company to ensure that departmental budgets are maintained and updated to have the money to support such raises.
Another tool in the compensation specialist's belt is the ability to compare the salary structures at competitors in the same area. This can be done by studying public documents from the other employers or by doing competitive research online or by interview. In certain situations, human resource departments from various companies within a given industry will cooperate and talk. It could simply be a matter of the compensation specialist comparing pay and benefit strategies with friends and former colleagues at other employers.