How much should you pay your employees? A concise guide.

Editorial Team

4 min read
Man in green shirt holding cash

Figuring out how to pay employees is a key consideration when running a business. And, in a competitive labor market, getting employee pay right is essential to attracting and retaining quality staff to run and grow your operations.

Even if you’ve hired a number of employees in the past, it’s important to consider the appropriate pay for each new role based on the assigned responsibilities. Pay transparency has also become a standard expectation for job candidates, so you’ll want to determine employee pay before advertising a new position. 

Here’s a simple checklist to keep in mind for how to pay employees as you approach the hiring process. 

1. Check local labor laws

First, make sure you’re abiding by minimum wage laws in your area. There have been changes to these requirements in recent years, so you’ll want to confirm that your employee pay meets the mark. 

You should also be paying employees fairly for the value they bring to your business. If you don’t pay enough, you won’t attract quality talent. And if you overpay, you may tip your profit scales out of balance.

READ: Tips for hiring in a super tight labor market 

2. Write a clear job description 

Writing a job description is necessary to post a hiring notice. This process can also help you determine how much to pay employees. In listing the responsibilities for the role, you may find that the position entails more (or less) than you initially thought. Use the writing process to consider what level of employee you’re really looking for and how compensation should reflect your performance expectations. 

In your hiring notice, pay particular attention to the language you use to describe the position, as that will indicate the experience level you’re looking for and help determine employee pay. If you want to hire a manager with experience supervising other employees, you’ll want to advertise the appropriate pay to attract quality candidates. Look at local job boards to see how other businesses describe their open positions to make sure your hiring notice is suitable in comparison.

3. Survey the hiring market

Consider looking at job listings in your area to gauge how much other businesses pay employees for similar positions. To recruit and retain top talent, you’ll want to be aligned with industry standards. Talk to other business owners and make sure your advertised pay is aligned with what job seekers expect.

4. Determine a fair range for compensation

Most potential employees expect to know hourly wages or salary upfront–often in a job listing. Familiarizing yourself with the local job market should also help you figure out a fair range for paying employees. You can offer more experienced candidates a wage that sits in the higher end of the range, while those with less experience may start out on the lower end–eventually working their way up.

Once you get new employees on the books, Clover POS systems can streamline the employee management and payroll process

5. Consult your budget

It’s important to pay employees fair and competitive wages, but you also need to ensure you have the budget to do so (after you pay yourself first). If your new employee’s needs don’t fit into your budget, consider whether the role could be part-time. You might also consider hiring an employee with less experience upfront and training them to assume responsibilities you’ll be able to pay them for in the future.

Whether you opt to hire a full-time employee or a part-timer, Clover’s employee management software solutions can help you keep your employees on the same team as you work together to grow an efficient business.

To learn more about using Clover’s retail, restaurant, or service industry POS solutions to run your business, contact a Clover Business Consultant today.


This information is provided for informational purposes only and should not be construed as legal, financial, or tax advice. Readers should contact their attorneys, financial advisors, or tax professionals to obtain advice with respect to any particular matter.

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