You've been in your new job as human resources director for only a week, and already you have a major personnel crisis on your hands. Some employees in the marketing department got their hands on a confidential salary report and learned that, on average, marketing employees earn less than engineering employees. In addition, several top performers in the engineering group make significantly more than anybody in marketing. The report was instantly passed around the company by email, and now everyone is discussing the situation. You'll deal with the data security issue later; for now, you need to address the dissatisfaction in the marketing group. Case Table 11.1 lists the salary and employment data you were able to pull from the employee database. You also had the opportunity to interview the engineering and marketing directors to get their opinions on the pay situation; their answers are listed in Case Table 11.2.

Your task
The CEO has asked for a short report, summarizing whatever data and information you have on engineering and marketing salaries. Feel free to offer your own interpretation of the situation as well (make up any information you need), but keep in mind that because you are a new manager with almost no experience in the company, your opinion might not have a lot of influence.

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CASE TABLE 11.1 SELECTED EMPLOYMENT DATA FOR ENGINEERS AND MARKETING STAFF Engineering Department Marketing Department Employment Statistic Average number of years of work experience 18.2 16.3 Average number of years of experience in current profession 17.8 8.6 Average number of years with 12.4 7.9 company Average number of years of college education 6.9 4.8 Average number of years between promotions Salary range 6.7 4.3 $58–165k $45-85k Median salary $77k $62k CASE TABLE 11.2 SUMMARY STATEMENTS FROM DEPARTMENT DIRECTOR INTERVIEWS Engineering Director Marketing Director Question In general, yes, but we need to make professionals receive allowances for the roughly similar pay? special nature of the engineering profes- sion. In some cases, it's entirely appropri- ate for an engineer to earn more than a 1. Should engineer- ing and marketing Yes. marketing person. 2. Why or why not? Several reasons: (1) Without marketing, Top engineers are ex- the products the engi- tremely hard to find, neers create wouldn't and we need to offer reach customers, competitive salaries; and the company (2) the structure of the wouldn't have any engineering depart- ment doesn't provide teams make equal as many promotional contributions to the opportunities, so we company's success. can't use promotions as a motivator the way marketing can; (3) many of our engi- neers have advanced degrees, and nearly all pursue continuous education to stay on top of the technology. revenue. The two 3. If we decide to balance pay between cap or reduce engi- If we do anything to If we can't increase payroll immediately the two departments, neering salaries, we'll to raise marketing lose key people to the salaries, the only fair thing to do is freeze raises in engineering and gradually raise marketing salaries how should we do it? competition. over the next few years.