In December 2022, the Practice Leaders at FlemingMartin held virtual lunches with more than 100 Chief People Officers (CPOs) from leading software and life science companies. It was clear from our interactions that CPOs are feeling a bit burnt out. That said, we were impressed with the resilience of this group of executives. As a community, the vast majority of HR leaders have been role models for their executive teams and have collectively risen to the occasion under incredibly difficult circumstances (Covid-19, labor constraints, inflation, remote work, layoffs, new employment laws, etc.). We ended up discussing a wide range of subjects, including:
Heartburn with New California Pay Transparency Law?
Not all of our attendees have figured out their policies to address the new pay transparency laws. Many are looking to larger companies to see what disclosure language they will use. Many leaders expressed anxiety around potential employee frustration once pay ranges are revealed. Some companies are striving to become globally/nationally transparent in terms of sharing their overall pay ranges. We also heard a preference for narrower pay range disclosure. This topic was one of our most heavily discussed.
Major Merit Increases for 2023 in Light of Inflation?
Most of our tech participants are allocating in the range of 3-6% for merit increases while our life science participants are mostly in the 4-7% range. Many Chief People Officers are also encouraging managers to allocate merit more heavily to high potential employees. There are several companies that have repriced options—particularly in the life sciences sector. Attendees with employees in India noted that wage inflation is a major issue prompting merit increases as high as 20%.
Power Balance Shift Between Employees and Employer Reflected in Return to Office?
While some CEOs may think that the pendulum has swung towards the employer, our attendees still believe that employees have leverage—especially top performing employees. The desire for return to office (RTO) seems to be increasing amongst executive teams, but many employees are still resistant to the idea of returning to the office unless they perceive great value in doing so. Several of our CPOs’ companies are “all in” on a remote model while many more are looking for creative ways to entice employees back 3-5 days per week.
Lack of Trust Between Reports & Managers?
Our attendees for the most part agreed that their companies could improve in gaining employee trust. Most HR leaders are emphasizing manager training to improve communications with their employees.
Holiday Party in December/January or Something Different?
Most companies are planning to host a party or buy a gift. Quite a few companies are hosting celebratory events in other months–instead of December. Companies that had done layoffs during the year are skipping holiday parties or hosting more subdued get togethers/individual team gatherings.
New Year’s Resolutions?
Even with everything on their plate, Chief People Officers are continuous learners and in constant improvement mode. Responses included improving personal health, learning a new language, finding board opportunities, etc.
