Day 13: How Much to Pay Each Person on Your Team (Part 2)
By: Brian Howard
If you want to build a dream team, you have to know how much to compensate each person on your team. In our last post, we unpacked three considerations for how much to pay each person on your team - The Four Times Rule, Comparable Salaries, and Local Context.
But the MOST IMPORTANT consideration for compensating a person is ALWAYS Replacement Value.
Above all else, fair compensation must be determined by replacement value. If a person in a role vacates the position, what will it cost to replace her with a person of comparable gifting and experience? The world of compensation is ruled by replacement value.
Seldom does a person earn $40 per hour if other equally competent people are willing to do the same job for $30 per hour. Conversely, it is unwise to pay a person below their replacement value. We are not encouraging you to use replacement value as an opportunity to save money. When replacement value is considered, competent church leaders are underpaid most of the time. The royal flush question for paying any person is: What would it cost us to replace the person in this role with a person of similar gifting and competence?
Before we wrap up these three posts on compensation, let’s discuss one final consideration. Sometimes, a church team member is so valuable to a congregation that his particular needs override other guidelines. A friend of mine has four children, two of whom are special needs. He needs the best health care money can buy and a house with hallways wide enough to accommodate two wheelchairs. He has a specific and unique need. He is so valuable to his church that they have decided to pay him what he needs to take care of his family, even though that may be more than the going rate for a pastor in his area.
Are you looking to build your dream team? Make sure to compensate them well. Your five considerations are:
1) The Four Times Rule
2) Comparable Salaries
3) Local Context
4) Replacement Value
Walking through these five steps will set you well on the way to a solid strategy for compensation.
And remember, we started Context Staffing to help you find the right leader. We specialize in finding leaders for churches. Our team spends hundreds of hours searching, recruiting, and vetting potential leaders for your church so that you can confidently build your dream team.