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Financial ServicesISCO 2423

Compensation analyst

A compensation analyst is a person who sets and orders pay within a company: establishing rates, assessing what they cost and seeing that pay answers to what an employee contributes.

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Rate 5 of the 18 essential skills of this occupation (European ESCO data). No account needed.

provide cost benefit analysis reports

estimate profitability

determine salaries

analyse financial performance of a company

calculate compensation payments

About compensation analyst

The analyst starts from the worth of each post and establishes remuneration levels: comparing posts inside the company, setting them against market pay data, and seeing that employees doing comparable work do not earn amounts whose difference cannot be justified.

Pay is also a cost. The analyst carries out financial analysis and estimates the profitability of pay arrangements, calculates benefit and compensation amounts, and delivers cost-benefit analysis reports to management.

A pay system is meant to reward what matters to the company. The analyst ties salaries and bonuses to contributions and to the behaviours that support corporate objectives and values, develops the rules for bonuses and writes them into company policies. The analyst knows employment legislation and takes corporate social responsibility into account, including the principle of equal pay for equal work. The work calls for financial analysis skills and knowledge of employment law and company policies.

Key Work Functions

Core areas of responsibility for a compensation analyst.

1

Compensation Strategy Development

  • Design competitive compensation packages aligned with company business objectives and corporate values
  • Conduct market research and salary benchmarking to position compensation competitively
  • Develop total rewards strategies that consider base salary, bonuses, benefits, and long-term incentives
  • Ensure compensation strategies comply with employment law and support business profitability
2

Financial Analysis and Reporting

  • Analyze financial performance data to estimate profitability of compensation programs
  • Provide detailed cost-benefit analysis reports to senior management and finance departments
  • Calculate compensation payments, bonuses, and employee benefits with accuracy and attention to detail
  • Track compensation expenses and monitor budget allocation for payroll and benefits
3

Salary Determination and Analysis

  • Determine appropriate salary ranges for different positions based on market data and job evaluation
  • Conduct job analysis and business valuation to support salary decisions
  • Analyze salary equity across organizational levels and departments to ensure fairness
4

Equal Pay and Compliance

  • Promote and monitor equal pay practices to ensure women and men receive equal compensation for equivalent work
  • Conduct pay equity audits and recommend corrective measures where disparities are identified
  • Ensure compliance with Polish labor law and EU employment regulations regarding compensation
5

Benefits Administration

  • Design and manage comprehensive employee benefits programs including health insurance, retirement plans, and wellness initiatives
  • Calculate and communicate employee benefit costs and coverage details
  • Maintain benefits records and ensure timely processing of employee benefit transactions

European Skills Framework

Skills and knowledge areas required for this occupation based on European classification.

Essential (18)

business valuation techniquesbusiness valuation techniquesThe processes to valuate the worth of the assets of the company and the value of the business following techniques such as asset-based approach, business comparison, and past earnings.corporate social responsibilitycorporate social responsibilityThe handling or managing of business processes in a responsible and ethical manner considering the economic responsibility towards shareholders as equally important as the responsibility towards envir...personnel managementpersonnel managementThe methodologies and procedures involved in the hiring and development of employees in order to ensure value for the organisation, as well as personnel needs, benefits, conflict resolution and ensuri...employment lawemployment lawThe law which mediates the relationship between employees and employers. It concerns employees' rights at work which are binding by the work contract.financial analysisfinancial analysisThe process of assessing the financial possibilities, means, and status of an organisation or individual by analysing financial statements and reports in order to make well informed business or financ...business processesbusiness processesProcesses which an organisation applies to improve efficiency, set new objectives and reach goals in a profitable and timely manner.human resource managementhuman resource managementThe function in an organisation concerned with the recruitment of employees and the optimisation of employee performance.company policiescompany policiesThe set of rules that govern the activity of a company.provide cost benefit analysis reportsprovide cost benefit analysis reportsPrepare, compile and communicate reports with broken down cost analysis on the proposal and budget plans of the company. Analyse the financial or social costs and benefits of a project or investment i...estimate profitabilityestimate profitabilityTake various factors into account to calculate the cost and potential revenues or savings gained from a product in order to evaluate the profit that could be generated by the new acquisition or by a n...determine salariesdetermine salariesDetermine salaries for employees.analyse financial performance of a companyanalyse financial performance of a companyAnalyse the performance of the company in financial matters in order to identify improvement actions that could increase profit, based on accounts, records, financial statements and external informati...calculate compensation paymentscalculate compensation paymentsCalculate the amount due by the insurance company in case of a legitimate claim, authorise the financial transfer and address reclamations to other insurance companies if needed.calculate employee benefitscalculate employee benefitsCalculate the benefits which the people connected to the organisation are entitled to, such as employees or retired people, using the information of the person and the interplay between governmental b...labour marketlabour marketThe trends, functioning, and fluctuations of the labour market, career options, wages, unions, working population and the supply and demand of certain professions in a sector.financial capabilityfinancial capabilityFinancial operations such as calculations, cost estimations, budget management taking relevant commercial and statistical data into account such as data for materials, supplies and manpower.business analysisbusiness analysisThe research field which addresses the identification of business needs and problems and the determination of the solutions that would mitigate or prevent the smooth functioning of a business. Busines...promote equal paypromote equal payPromote actions which aim to close the pay gap between the different genders by researching the current circumstances which facilitate the continuance of the pay gap and the fields in which pay gaps p...
Optional (11) — show
financial forecastingfinancial forecastingThe tool used in performing fiscal financial management to identify revenue trends and estimated financial conditions.business loansbusiness loansLoans which are intended for business purposes and which can either be secured or unsecured depending on whether a collateral is involved. The different types of business loans such as bank loans, mez...human resources department processeshuman resources department processesThe different processes, duties, jargon, role in an organisation, and other specificities of the human resources department within an organisation such as recruitment, pension systems, and personnel d...actuarial scienceactuarial scienceThe rules of applying mathematical and statistical techniques to determine potential or existing risks in various industries, such as finance or insurance.analyse unemployment ratesanalyse unemployment ratesAnalyse data and perform research concerning unemployment in a region or nation in order to identify causes for unemployment and possible solutions.carry out job analysiscarry out job analysisResearch and perform studies on occupations, analyse and integrate data to identify the content of jobs, meaning the requirements to perform the activities, and deliver the information to business, in...control financial resourcescontrol financial resourcesMonitor and control budgets and financial resources providing capable stewardship in company management.manage payroll reportsmanage payroll reportsMaintain personnel records as well as payroll reports. Record evaluations, promotions or disciplinary actions.calculate dividendscalculate dividendsCalculate the payments made by corporations as distribution of their profit to the shareholders, ensuring that the shareholders receive the correct amount in the correct format, meaning in monetary pa...develop employee retention programsdevelop employee retention programsPlan, develop, and implement programs aimed at keeping the satisfaction of the employees in the best levels. Consequently, assuring the loyalty of employees.manage staffmanage staffManage employees and subordinates, working in a team or individually, to maximise their performance and contribution. Schedule their work and activities, give instructions, motivate and direct the wor...

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Frequently asked questions

What does a compensation analyst do?

Compensation analysts recognise and reward contributions and behaviors that support company’s business objectives and corporate values.

What skills does a compensation analyst need?

A compensation analyst needs 18 essential skills, including business valuation techniques, corporate social responsibility, personnel management, employment law, financial analysis.

Will AI replace compensation analyst jobs?

The AI disruption score for compensation analyst is 80/100 (very high risk). Skills most exposed to automation: calculate dividends, provide cost benefit analysis reports, calculate employee benefits. Most resilient: human resource management, develop employee retention programs, business analysis.

AI Replacement Risk

80/ 100
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Quick Facts

SectorFinancial Services
ISCO GroupBusiness and administration professionals
Essential Skills18

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