51, What is the cost I should pay our HR staff
One of the questions organisations frequently ask is what kind of salary or cost they should be paying their HR staff. Since HR plays a critical role in shaping culture and supporting business outcomes, this decision needs to be approached with clarity and consistency.
Using Market Benchmarks for HR Roles
When organisations decide how much to pay employees in line or technical functions, they usually follow a structured approach. This involves identifying a set of comparable organisations and understanding what people in similar roles are being paid in the market.
The same approach should be applied to HR roles. Organisations should not create a separate or isolated benchmark for HR. Instead, HR salaries should be evaluated using the same competitive universe and market positioning used for other functions.
Positioning HR Within the Organisation
Every organisation implicitly decides whether it wants to pay at the market median, above the market, or at a premium level. This positioning decision applies equally to HR roles.
HR leadership roles, especially at mid‑management and senior levels, should be viewed in the same way as technical or delivery leadership roles. At whatever level the organisation believes technical leaders should be paid, HR leaders should be treated similarly.
Why Consistency in Pay Matters
The HR function has a unique responsibility of building and reinforcing organisational culture. The messages HR sends—through programs, policies, and daily interactions—are shaped by how the organisation treats the HR team itself.
When HR is compensated consistently and fairly, it reinforces the message that the organisation values the function and expects it to treat all employees with the same fairness and consistency.
Managing Overpayment and Underpayment
Whether an organisation believes it is overpaying or underpaying its HR staff is a strategic decision. If adjustments are required, they can be managed through role design by adding responsibilities, redefining scope, or adjusting team size.
The key is to have a clear methodology rather than making ad‑hoc or emotionally driven decisions about HR compensation.
Building a High‑Impact HR Function
Following a consistent compensation methodology for HR roles helps build a motivated and effective HR function. Without such a structured approach, there is a significant risk that the HR team may not perform at the level required to support organisational growth.
A well‑paid, well‑positioned HR function completes the circle by influencing culture positively and supporting the business in a meaningful way.
Related Podcast Episode
This article is based on the transcript of the original podcast of the same name featured in India HR Guide.
The transcript has been translated into this article with the support of AI and a human‑in‑the‑loop process.
