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Director of Compensation and Benefits Job Description
  • Publish: April 2, 2021
  • Author: StrongerTeams Editorial
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Director of Compensation and Benefits Job Description

A Director of Compensation and Benefits is responsible for the entire remuneration and benefits system of the organization. The role builds, implements, and oversees all aspects of salary, benefits, and bonuses across the whole organization. The position is highly strategic but includes leadership and management of day-to-day functions.

A successful Director of Compensation and Benefits must be an expert in compensation strategy and must collaborate at the senior management level with every department in the organization. Their effectiveness has a significant impact on employee satisfaction, staff retention, and the productivity of the whole organization.

Similar Job Titles:

HR Director, Human Resources Manager, Assistant Director of Human Resources, Vice President of Human Resources, HR Director, Compensation and Benefits Manager

What Does a Director of Compensation and Benefits Typically Do?

A Director of Compensation and Benefits strategizes, plans, creates, and oversees every element of the organization’s remuneration system. This includes the salary, bonuses, paid and sick leave, welfare benefits, and retirement plans. 

A Director of Compensation and Benefits will work within HR but will typically engage with senior management from all departments. The role is diverse and demands strategic thinking, tactical ability, and strong collaborative skills. 

The tasks a Director of Compensation and Benefits performs include:

  1. Benchmarking current compensation and benefits against the macro environment
  2. Developing a remuneration and reward strategy
  3. Implementing and overseeing remuneration plans
  4. Advising senior managers on compensation issues
  5. Overseeing role or job changes within teams
  6. Managing the annual organizational salary review process
  7. Leading and managing a team of practitioners
  8. Acting as a pension fund trustee

Benchmarking Current Compensation and Benefits Against the Macro Environment

A Director of Compensation and Benefits ensures that the organization’s current remuneration and reward schemes are fair, equitable, and attractive. The policies should be benchmarked against competitors, the local environment, and global trends to ensure that the organization can recruit and retain top-performers. 

The Director of Compensation and Benefits also works closely with top management across the organization to understand projected future needs.

Developing a Remuneration and Reward Strategy

In collaboration with senior management, a Director of Compensation and Benefits develops a clear and concise strategy for the organization. The strategy should take into account the diversity of jobs in the organization, as well as the organization’s growth expectations in the medium and long term.

Developing the remuneration strategy demands a clear understanding of every department’s targets, plans, and staffing requirements. The Director of Compensation and Benefits should reflect each department’s wishes in the strategy.

Implementing and Overseeing Remuneration Plans

A Director of Compensation and Benefits ensures that the plans are translated into reality and that the remuneration process is monitored and tracked. They work with the compensation and payroll team to develop policies and procedures to implement the remuneration plans.

Advising Senior Managers on Compensation Issues

Departmental heads and a Director of Compensation and Benefits work together to resolve any remuneration-related issues that occur. These issues will typically be related to bonuses and benefits, and the Director of Compensation and Benefits should ensure that issues are resolved to the mutual satisfaction of all stakeholders.

Overseeing Role or Job Changes Within Teams

Any promotions, job scope changes, and transfers should be reflected quickly and accurately by the Compensation and Benefits team. These changes may extend to international intra-company transfers, in which case, a Director of Compensation and Benefits should understand all the legislative requirements of the new location.

Managing the Annual Salary Review Process

The salary review process is a bottom-to-top exercise to determine remuneration increases for all employees in the organization. The review will normally be run by departmental heads, but the Director of Compensation and Benefits should be involved in and monitor the process. Following the review, the Director of Compensation and Benefits must ensure that all relevant documentation is collated and input into the HRIS and payroll system.

Leading and Managing a Team of Practitioners

The Director of Compensation and Benefits trains, coaches, and mentors all team members and ensures that they are performing consistently. The management function requires expert knowledge of situational leadership, performance coaching, and career-pathing techniques.

Acting as Pension Fund Trustee

A Director of Compensation and Benefits may be asked to act as a trustee of the organization’s pension fund. Trusteeship will require expert knowledge of the relevant legislation, duties, and expectations of a trustee.

Roles a Director of Compensation and Benefits Typically Collaborates With

A Director of Compensation and Benefits will work closely with the following posts:

Collaborative Roles
HR DirectorHuman Resources ExecutivePayroll Manager
HR ManagerHR CoordinatorPayroll Coordinator
Senior HR SpecialistChief Executive OfficerHuman Resources Project Manager

Director of Compensation and Benefits Salary

The national average salary for a Director of Compensation and Benefits will typically be between $147,000 and $191,000 annually in the U.S. The median is around $167,608.  

What Is the Director of Compensation and Benefits Pay Difference by Location?

Average salaries for a Director of Compensation and Benefits differ by location as follows:

CityAverage Salary
San Francisco, CA$209,510
Seattle, WA$183,263
Denver, CO$169,502
Austin, TX$164,843
Washington, DC$186,582
Milwaukee, WI$165,880
Boston, MA$188,844
New York, NY$201,633

What Is the Director of Compensation and Benefits Pay Difference by Experience Level?

Depending on experience, pay will vary as follows:

Experience LevelAverage Salary
<1 year$155,763
1–4 years$156,698
5–9 years$159,192
10–19 years$166,050
20+ years$166,985

Director of Compensation and Benefits Job Description Template

[Company Name] is seeking a highly experienced and strategically-minded Director of Compensation and Benefits to oversee the company’s entire remuneration and reward policies.

You will take on a senior role, reporting to top management and collaborating with department heads. You will be expected to formulate strategy, implement plans, and ensure that [Company Name] is an employer of choice.

You must be experienced at the top levels of management, aware of the latest global trends in remuneration, and have the gravitas to implement your plans across the organization.

Director of Compensation and Benefits Responsibilities

  • Benchmarking current policies to ensure competitiveness
  • Developing Compensation and Benefits strategies and plans
  • Ensuring faultless implementation of compensation and benefits policies
  • Collaborating with all department heads to drive continuous improvement
  • Managing the annual salary review process
  • Leading the Payroll and Benefits teams

Required Skill Set

  • Bachelor’s degree in HR, Accounting, Finance, or Payroll
  • At least ten years’ experience in an HR managerial position
  • Expert knowledge of accounting
  • Strategic planning expertise
  • At least five years’ successful team leadership experience
  • Expert knowledge of common HRIS
  • Conflict resolution and change management skills
  • Strong grasp of project management
  • Collaborative and client-centric mindset

Hiring Resources for Ambitious Companies

  1. Ensure complete accuracy for your employees’ pay. Implement the best time tracking software solutions and eliminate mistakes
  2. Get rid of confusion, supplication, and clutter. Keep all your employee information neatly sorted in a centralized platform with employee record software
  3. Is your payroll complicated by bonuses, incentives, and commissions? Make complex payroll calculations simpler with commission-based payroll software
  4. Contractors and freelancers on your payroll? Ensure accurate payments with 1099 payroll software
  5. Have all relevant business data at your fingertips with the best HR analytics software. Identify gaps and areas for improvement based on raw data and cut out the guesswork
  6. Not sure how productive your people are? Hold them accountable and boost their performance with the top employee monitoring software solutions
  7. Get new hires integrated into your team faster and better with the best onboarding software
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