Money matters:

• Competitiveness – as the job market has changed a lot in recent years and for many kindergartens it has become increasingly difficult to find qualified staff. As a matter of fact almost all non-profit kindergartens like rainbowtrekkers pay less than church or public kindergartens due to the mode of public financing. Within the non-profit sector wages have gone up in recent years which is definitely a good sign. Unfortunately, there is still a huge gap in income between kindergarten teachers and, for example, elementary school teachers in this country.
• Transparency is also a factor in changing the pay scale. As an organization, rainbowtrekkers has matured over the years. We understand that there will always be talk about the salaries of others, but by encouraging more transparency on who earns how much, we hope to instill more mutual trust and harmony. Employees will no longer need to hold salary negotiations on his or her own. Employees will not receive favoritism and no one is outsmarted.
• Renewed dynamics within the teams is what we hope for. We believe we finally have a system that encourages people to advance themselves professionally and provides them with an opportunity to develop their language skills.

Our new pay scale is a spawn of shared leadership, responsibility and creativity of the Management Meeting, but mainly the principals. Together we researched and analyzed the market situation, developed a matrix of qualifications for the different job descriptions, agreed on a child-caregiver-ratio that makes sense pedagogically. From that we derived a staffing plan for the different institutions. We also brainstormed a list of different salary components and how they could be used to reflect our values in the best way possible. Together with the calculation phase this creative process, which was commonly managed by the principals, HR and CEO, took slightly more than a year.

During our final calculation phase the plan had to be readjusted more than once due to financial restrictions. The share of salary costs covered by rainbowtrekkers has grown steadily during the last 13 years and now reaches far beyond 60%. When designing a more dynamic pay scale for the long term, we had to calculate very conservatively as to not endanger the liquidity of the organization. Tomorrow we want to be able to pay the salaries that we promise today. Another factor we had to take into account is that the generated income through public funding is growing only by a very slow rate per annum.

So here we go….. What is the new pay scale?

The main idea is to create a more differentiated structure which directly relates to a team member’s training, position, skills and experience. To get there we decided to grant a basic salary component of the same level to everybody and on top of that to pay different additional components, namely

• Qualification bonus
• Role benefit
• Bilingual bonus
• Experience premium

This results in a multi-layer style of salary according to the following illustration:

• Other young companies actually use a similar scheme, which reaffirms to us that we are on the right track. When pricing the different factors our aim was to produce as many “winners” as possible. According to our calculations, about 90% of rainbowtrekkers’ staff will experience a financial improvement under the new scheme immediately, depending on their qualification and experience. For others this effect will take place during the next few years.We are aware of the fact that no pay scale can be a hundred percent fair. We are sure that there will be surprises and things will show up that we did not take into consideration. However, we tried our best to create a system as fair as possible. We see it as a process which must and will be readjusted as time goes by.Studies have shown that money can’t buy us happiness and salaries don’t buy us satisfaction or motivation, but too low a salary can be demotivating. That’s why it’s important for us to pay at an average level and to be clearly above average with our overall package. Even under the new pay scale an educator might still earn a slightly higher salary at Stadt Köln or elsewhere, but we are confident that with motivated leaders, the right spirit and meaningful work we can create a place that is special for us and the children in our care.