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LPL Financial’s Employee Compensation Philosophy

At LPL Financial, we strive to offer total rewards, including compensation, benefits, and recognition programs that help our company be an employer of choice. Compensation is performance based, market informed, and business driven.

At LPL, the primary objective of our compensation program is to provide employees with competitive and equitable compensation that helps attract, motivate, and retain the talent needed for the company's success. In order to align to business results and reward top performers, we differentiate rewards based on both company and individual performance.

In order to achieve that objective, we believe that personalizing pay to an employee’s role and sharing that information transparently is the best way we can deliver on our promise to employees to create an environment that empowers our employees to thrive. 

Job-based Pay Ranges

Job-based pay ranges provide a unique salary range for each job at LPL Financial. Each range is specifically determined based on the job duties and skills required for the role. The ranges are reflective of the salary opportunity for similar jobs in the external market. Additionally, job-based ranges provide an agile compensation structure that supports LPL's continued growth by enabling us to identify and update ranges for jobs that are seeing significant growth in the market, while not changing the ranges for jobs that are experiencing slower growth.

How are LPL’s job-based pay ranges determined?

We use market data and trends to determine job-based pay ranges. Each range is based on market data for the specific role. LPL’s Compensation team works with business leaders and HR Consultants to validate the roles and their responsibilities. Roles are then matched with multiple, similar roles from best-in-class labor market data providers. LPL uses employer-reported labor market data we purchase from reputable providers; not crowd-sourced or employee-reported pay information. The ranges are validated annually and, as needed, to address changes to the job or the competitive landscape.

Market Informed, Business Driven

As a pay-for-performance company, compensation within the pay range will vary based on relevant factors such as qualifications, skill set, and performance, and will evolve based on those same attributes. Employees are encouraged to actively engage in career development conversations with their managers to unlock their potential, develop their strengths and foster continuous improvement. Managers and leaders then have the flexibility to consider a number of factors to determine pay, including:

  • Qualifications
  • Performance
  • Internal Equity
  • Business and Operational Needs

LPL Financial has two geographically-based compensation structures. In areas where external data surveys note the cost of labor is high, such as Boston and San Diego, market salaries for jobs are about 10% higher than the salaries for the same jobs in other locations, such as Fort Mill. We regularly evaluate the compensation structures for internal and external movement and update them periodically to reflect salary market movement.

Focus on Pay Equity

LPL recognizes being proactive in the analysis of equitable pay treatment across our pay programs prevents situations where similarly situation employees aren’t being compensated in alignment with our compensation philosophy. 

In order to deliver on that commitment, after our own internal review, we engage outside experts, to conduct three distinct analyses—of base pay, merit increases, and discretionary bonus awards—of employees below the EVP level who are not on sales incentive compensation plans. Using computer models created for LPL, these analyses take into account the factors that underlie LPL’s specific compensation decisions and identify individuals whose base pay, merit, or bonus, as applicable, is lower/higher than expected to a statistically significant degree.

In particular, we ask the outside experts to focus on whether there are statistically significant variations tied to race, ethnicity or gender. Once the data has been analyzed, any outliers tied to race/ethnicity or gender are reviewed again internally by LPL’s HR consulting, compensation and legal teams. This group will meet with managers to better understand if there is a specific rationale for the compensation decision and, if appropriate, implement adjustments. These compensation analyses are an important component of LPL’s compensation strategy and overall efforts to ensure each employee’s compensation fairly aligns with their role, level, contributions, performance and other relevant factors.