I tell my clients all of the time that their compensation system is one of their most powerful communication vehicles.
If your highest-paid employee violates company values, you are telling your team that the values do not matter.
If you give everyone the same pay increase regardless individual performance or company performance, you could be saying either that team matters most, you value equality, or risk/innovation is not a company priority.
If you reward most heavily on longevity, then you are communicating that you value those actions that allow people to stay there over time: Loyalty? Stasis? Quality?
What is your compensation system saying about your company's values?
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