Compensation Calculations

Here is the deal with compensation planning…

It takes a ton of spreadsheet know-how (aka work). Planning to give hundreds or thousands of employees a pay raise is tough enough. But if we only gave employees a pay check they would leave your organization!

What…. I get more than a paycheck?

Of course! Most of us receive benefits & retirement contributions from our employers.


How do you tackle compensation planning. You may call it collective bargaining, meet & confer, pay for performance, executive comp, or simply a pay raise.

But here is the kicker:

At the end of the day pay raise calculations come down to what your organization can afford. You have to answer the question, how much of a pay raise can we afford?

You must calculate the total pay raise PLUS + the cost of benefit premium increases PLUS + the increase to retirement contributions as employees receive pay raises. (repeat now for every employee!!)

The most widely used tool to calculate your payroll costs for the next fiscal year is a spreadsheet.

This is crazy:

A spreadsheet? Yes! There are crazy detailed pay raise calculation techniques that you can build in a spreadsheet.

Why? Because a pay raise has a trickle down impact. A properly built compensation spreadsheet is a powerful tool.

When you increase an employee’s salary or hourly wage you normally immediately impact their retirement contribution and you always impact PAYROLL TAXES!

It gets worse:

Worse than what? Well… worse than guessing. Maybe if your Facebook you can blindly give every employee a 10% pay raise and no one cares!

But you probably don’t have unlimited money $!$!

That is why modeling your compensation costs is VERY important to retain and attract high quality employees.

It gets better:

Your salary and hourly wage schedules can be built in a compensation spreadsheet model. HURRAH!

Now…You want your model to calculate TWO things at a minimum:

  1. First > your total current payroll costs. How much are you spending to execute payroll. You’ve got to break it down to compensation, benefits, retirement contributions and payroll taxes!
  2. Second > your future payroll costs. What will you pay to execute payroll this coming fiscal year? You need to know how much you will be spending on compensation, benefits, retirement contributions, and payroll taxes.

You might be wondering:

Wait, I’m doing this in a few spreadsheets that I’ve hacked together. Well… that is better than guessing!


How can you get proven compensation planning spreadsheet models? Proven comp models that work accurately every time you run a pay raise scenario! Read below…

What is the bottom line:

At the end of the day most of us don’t wake up thinking about building compensation models in a spreadsheet!

That is where CompPro comes into play! CompPro is a compensation modeling software where you don’t need crazy spreadsheet models to calculate pay.

Your compensation model is unique! With CompPro we customize the web based software to match your compensation model. No formulas. No links. Just model the cost of payroll.

Ok… now what?

You can use my proven compensation modeling spreadsheets or use CompPro!

Learn through my youtube videos & get the spreadsheet models by reaching out to me HERE. 

Or…you can become Facebook and have unlimited resources and blindly give all employees a 10% pay raise every year!

Be happy!