By: Dessie Barton, People & Culture Consultant
As BC employers begin compensation and benefits planning for 2027, pay and benefits decisions should be part of the conversation early, not simply addressed when annual salary increases are approved.
Effective compensation and benefits plans start with clear business goals and an understanding of employee needs. Employers should review current pay and benefits, assess internal consistency and market competitiveness, and prioritize changes within a sustainable budget.
For employers, the goal isn’t necessarily to spend more. It’s to make deliberate decisions about where compensation and benefits investments will have the greatest impact.
Step 1: Start With Your Business and Workforce Goals
Before deciding on salary increases or benefit changes, consider what the organization needs to accomplish in 2027.
Ask:
- Are you planning to grow or hire for new positions?
- Are certain roles becoming difficult to recruit or retain?
- Are labour costs increasing faster than anticipated?
- Are you experiencing turnover in particular roles or departments?
- Have employee expectations around flexibility, benefits, or time off changed?
- Are there critical skills or employees you need to retain?
These answers help establish what your compensation strategy needs to achieve.
Step 2: Review Your Current Compensation Structure
Next, assess how employees are currently being paid.
Review:
- Base salaries and hourly wages
- Salary ranges
- Bonuses and incentive compensation
- Vacation and paid time off
- Health and wellness benefits
- Retirement or savings programs
- Other allowances and perks
Gather current salary ranges, employee pay data, benefit costs, and relevant policies to support your review.
BC employers covered by provincial employment standards should first ensure their compensation practices meet applicable minimum requirements. The BC minimum wage in 2026 increased to $18.25 per hour on June 1. Employers should monitor the province’s information for updates affecting 2027.
BC’s Employment Standards Act also establishes minimum requirements for areas such as vacation and vacation pay. These requirements should form the baseline for your compensation review.
Step 3: Look for Internal Pay Gaps
Market competitiveness matters, but so does consistency within the organization.
Review internal pay equity by considering whether employees performing comparable work are being paid consistently and whether differences can be reasonably explained by relevant factors such as experience, responsibilities, performance, or specialized skills.
Watch for:
- New hires earning close to or more than experienced employees
- Employees whose salaries have fallen below established ranges
- Significant unexplained differences between similar positions
- Managers earning only slightly more than their direct reports
- Salary ranges that no longer reflect actual employee pay
Wage compression, also called pay compression, occurs when pay differences narrow between employees with different levels of experience or responsibility. Higher starting salaries or minimum wage increases can contribute when experienced employees’ pay doesn’t keep pace.
BC’s Pay Transparency Act makes structured compensation practices increasingly important. Provincially regulated employers must include expected salary or wage information in publicly advertised job postings, and employers cannot ask applicants about their pay history. The Act also includes protections relating to employees discussing their pay.
Review the Province’s guidance on wage or salary information in job postings when assessing your recruitment practices, and check whether your organization is subject to BC pay transparency reporting requirements.
Step 4: Conduct Salary Benchmarking Against the Market
Once you’ve reviewed internal consistency, use salary benchmarking to compare pay for similar roles in relevant labour markets.
Reliable market data can help employers understand:
- Typical salary ranges for comparable positions
- Differences based on location, industry, and organization size
- Roles where your organization may be significantly above or below market
- Positions experiencing greater competition for talent
Market data shouldn’t automatically determine what an employee is paid. Instead, use it alongside internal equity, organizational priorities, employee experience, and affordability.
Pivot HR Services’ Compensation Strategy & Total Rewards Services can help employers benchmark compensation, develop salary structures, and assess internal and external competitiveness.
Step 5: Review Benefits as Part of Total Compensation
Salary is only one part of an employee’s overall compensation package. A total rewards strategy considers pay and benefits alongside other elements employees value, such as flexibility and professional development.
As you plan for 2027, review whether your benefits still reflect employee needs and organizational priorities.
This could include:
- Extended health and dental coverage
- Retirement or savings contributions
- Vacation entitlements
- Paid personal or wellness days
- Flexible or hybrid work arrangements
- Professional development
- Employee assistance programs
- Other health and wellness supports
Rather than adding benefits simply because competitors offer them, consider employee utilization, feedback, cost, and perceived value.
Step 6: Identify and Prioritize Changes
Most organizations cannot address every pay concern in a single compensation and benefits planning cycle.
Once your review is complete, categorize potential changes by priority.
| Priority | Examples |
| Compliance | Minimum wage or vacation-pay requirements |
| Internal consistency | Significant unexplained pay differences or wage compression |
| Market competitiveness | Critical positions significantly below market |
| Retention | High-turnover or difficult-to-replace roles |
| Employee experience | Benefits employees value, but the current program doesn’t adequately address |
This approach helps employers direct available resources toward the areas with the greatest organizational impact.
Step 7: Communicate Your Approach
Compensation decisions can create confusion when employees don’t understand how decisions are made.
Before rolling out changes, determine:
- What managers need to know
- What will be communicated to employees
- How salary increases will be explained
- How employees progress through salary ranges
- How benefit changes will be introduced
- When changes will take effect
- Who will answer employee questions
Managers should be equipped to explain the organization’s approach consistently without making promises or commitments outside the approved compensation framework.
Start Your Compensation and Benefits Planning
Compensation planning for 2027 is an opportunity to move beyond individual salary decisions and take a more strategic look at your overall approach to pay and benefits.
At Pivot HR Services, we have supported more than 120 organizations across BC and Canada. Our compensation consultants help BC employers assess internal equity, benchmark pay, develop salary structures, and design total rewards strategies that align with organizational goals.
Planning your approach for 2027? Book a free consultation with Pivot HR Services to discuss your priorities and explore how we can help you build a competitive, sustainable compensation and benefits plan.