Employee compensation is the most important thing when we talk about hiring new staff, and new talent in particular. You can work for an amazing company, one that pursues lofty ideals and goals, trying to change the world, or perhaps save it.

Yet as long as you do not offer competitive remuneration to job applicants, they will sell their time and skills to one of your competitors. Because while we all dream of having meaningful jobs and making an impact with our work, we also have bills to pay, kids to feed, and nice things we want to buy for ourselves…

Compensation analyst is one of the key employees in any organization. Maximizing employee retention and optimizing labor costs, they can make a huge difference for the company. You made a good career choice, but you’ll have to pass a tricky interview. Let’s have a look at questions the interviewers will likely ask you.


Why do you want to work as a Compensation Analyst?

You should try to refer to two things in your answer: meaningful purpose of the job, and skills and abilities that make from you the right candidate.

Perhaps you earned degree in Human Resources or in Business Administration, but that’s not the most important thing. You have excellent analytical skills, ability to extract the right information from a bunch of numbers. What’s more, you have a decent knowledge of market trends and conditions, and believe to understand how to design proper compensation packages.

You may lack experience, but you compensate for it with motivation and eagerness to learn–which is already reflected in the seminars you attended, books you read, and certification you got (or want to get in the future, once you meet the requirements).

At the same time you understand the pivotal role proper compensation plays in hiring new staff, and the difference you can make for your employer with a good job. This alone is highly motivating for you.

Another alternative is telling them a story. It starts with your education and continues with the experience you’ve gained up to this point in the field. It culminates at this moment, when you finally feel ready to apply for a job which you always wanted to have…

Try to talk with enthusiasm about your career choice. They shouldn’t get an impression that you apply because you have to, and not because you want to.


Can you please walk us through your resume?

Try to focus on relevant things. That means your education–you can point out two or three subjects or courses that prepared you in particular for the role of a Compensation Analyst (financial analysis, time row analysis, statistics, HR management, etc).

Talking about your experience, you can emphasize duties you had in your last jobs that at least somehow prepared you for this one–any work you did with numbers and data, any creative work, communication with colleagues and people, analyzing and forecasting, etc.

You can also mention one or two hobbies, or briefly something from your personal life. At the end of the day interviewers are also people, with their life and hobbies. They want to see a good job candidate in you, but also an honest and interesting human being, someone they perhaps have something in common with, a good new colleague.


Imagine that we hire you for the job. Your first task is to evaluate the existing remuneration packages. How will you proceed?

What they are looking for is a complex approach. If you focused on one facet of remuneration packages analysis only, for example the experience of the employees, they would not hire you. Or at least you would not get many points for your answer to this question, and everything else would be an uphill battle from there.

Try to show holistic approach to your work. Say them that you will:

  • Look at the data in compensation surveys, comparing the averages with the packages the company pays to employees on various positions.
  • Do questionnaires, or one on one meetings with all employees, trying to understand their point of view, whether they are satisfied with the remuneration, and areas for improvement they suggest.
  • Talk to the managers, trying to understand the bigger picture, the budgets, the value of different positions and how it relates to the compensation offered to each particular employee.
  • Study the latest market trends and try to forecast the future development on the job market for each position, since it also impact the salary and benefits for each employee…

Taking all 4 things into your consideration, you will evaluate the existing packages and suggest areas for improvement.

How would you develop a compensation package for a new position in the company?

When we talk about a new position (new job title, company does not have the same employee yet), you cannot help yourself with the existing data from the company.

Say that in such a case you’ll rely primarily on the available data from salary surveys. You’ll analyze them properly, trying to find a benchmark, a number that’s competitive enough–because if you set the bar too low you’d miss on the real talent. They would just skip your offer.

At the same time, however, you’ll consult the responsible manager, trying to understand the value of the position for the company, and you will also inspect the situation on the employment market–whether supply exceeds the demand or on the contrary, companies fight for skilled job applicants in this field…

Summarizing everything, you should be able to come up with the proper compensation package for the new position, competitive enough to attract some real talent.


Describe a conflict you had with one of your colleagues in your last job. How did you handle the conflict?

When money is at stake, there will always be conflicts. One time an employee won’t be satisfied, demanding a raise which a company cannot give them.

Another time you’ll have to convince one of the managers about your suggested remuneration for a new employee. They will demand a lower sum, but you will know (following the research you did), that this the bare minimum a company has to offer, as long as they want to attract at least any decent applicants.

Narrating a conflict from your last job, try to show the right attitude to conflict situations. An “ideal conflict” should have the following characteristics:

  • You argued about some professional issue related to the job, and not about some pointless personal stuff.
  • You did your best to keep emotions out of the conflict. It was a matter of fact discussion.
  • The other conflict party had their point, and you did not hesitate to admit that they were right–at least from their perspective.
  • The conflict ended in a positive way, you came to a conclusion that was acceptable for both conflict parties.


What do you do to stay up to date with the changes in labor legislation?

This one is relatively easy. You can talk about the trade publications you read, newsletters you receive regularly (concerning the changes in labor legislation), conferences and seminars you attend, or at least read about.

Alternatively you can point out 2 or 3 websites you follow regularly, websites that monitor the latest changes in labor legislation.

Just like with any other question, your attitude is the most important thing for the interviewers. When they see that you care, that you are honestly interested in your field, checking the latest trends and news, doing what you can to stay on the top of things, they will be satisfied with your answer.


Other questions you may face in your Compensation Analyst job interview

  • What do you want to accomplish as a Compensation Analyst in our company?
  • Describe us your idea of a typical day in this job.
  • Tell us about as time you struggled with motivation in work. What did you do to overcome the crisis?
  • Why did you leave your last job? Why do you plan to leave your present occupation?
  • Describe a time when you struggled to communicate something to one of your colleagues in work. What did you do to eventually get your message over?
  • What do you consider your biggest weakness when we talk about a job of a Compensation Analyst?
  • Where do you see yourself in five years time? How long would you like to have this job?
  • What are your salary expectations?
  • What do you hope to gain from this experience?
  • Why shouldn’t we hire you?

* Special Tip: If you are not sure how to answer the questions from my list, or experience interview anxiety, have a look at our Interview Success Package. Up to 10 premium answers to basically all tricky questions you may face in your Compensation Analyst job interview will help you streamline your interview preparation, outclass your competitors, and eventually get the job. Thank you for checking it out!


Conclusion, final thoughts

Interview for a job of a Compensation Analyst belongs to difficult job interviews. A popular job title which pays a good annual salary, it typically attracts a lot of job applications, from a variety of skilled HR employees and graduates.

What’s more, interviewers will ask you some tricky situational and behavioral questions, examining your readiness for the job, and your attitude to various situations that may happen in the workplace. Try to prepare the questions, and do a good research about the employer (their core values, salaries and benefits they offer to employees on different positions, organizational structure of their HR department, etc).

This is a tricky interview, and unless you devote enough time to your preparation, you’ll find it hard to succeed. But I hope you will make it, and ace your interview. Good luck!


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Matthew Chulaw
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