Compensation and Benefits Plan

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Compensation and Benefits Plan
HRM/531


Compensation and Benefits Plan
Compensation and benefits play a vital role in employee satisfaction and performance; employees in general want an adequate compensation package for their contributions in an organization. However, according to Cascio (2010) a high-based salary alone does not guarantee a productive, motivated workforce. Today, workers have increasing personal demands to balance their quality of work life; more workers desire a strong benefit package that includes health and disability insurance, flexible time, paid time off, retirement plans, and other cluster of gratuities to join or stay in an organization. On the other hand, aside from legal compliance in paying their employees, employers lure talented employees into their companies by offering high-level salaries and attractive fringe benefits packages. However, excessively high labor costs can ruin or break a business. Hence, designing and managing a fair, competitive pay structure without endangering the financial standing of the firm is very important. The objective of this paper is to propose a fair, competitive compensation and benefits package that meet the demands of an employee and the needs of the organization he or she works for. Team A used Salary.com to design an adequate compensation and benefits plan proposal for a service area manager position. Overview of Salary.com

A job search is not complete without knowing the compensation and benefits that come with the job. To research a Service Area Manager’s worth in the labor market, one can research on several websites that provide comparable compensation and benefits ranges information for the job position searched. Salary.com is one of those websites. According to the Salary.com website (2013). “The Salary.com methodology is a state-of-the-art process for benchmarking and analyzing jobs that builds on professional industry standards” (para. 3). Many people consider Salary.com the best website for job-seekers and current employees to research basic salary information. The information provided by Salary.com gives the user a real-time snapshot of the general salary ranges for the position searched. The website also provides a benefits calculator and a cost of living wizard to use to get a closer look at similar benefits offered by organizations in various locations. Salary.com allows users access to its extensive compensation and benefits database and the use of its tool free of charge. For example, under Salary Wizard, users can calculate the annual value of benefit using the benefits calculator. However, to get a more in-debt assessment salary.com recommends using its paid version of the site. The paid version of the site gives the employee a concentrated written report of salary information in relation to others in the exact position within the same geographical area. Access to this type of information can be extremely important in negotiating salaries. The website provides several research tools that can be very helpful to the employees and the employers. Pay Structure Proposal

Firms use competitive pay to ensure they have the talents needed to achieve organizational goals. Consequently, compensation is an essential component of employer-employee relationship. Based on the job description and job specification for service area manager, Team A proposed a compensation system that offers a market-based pay, bonuses, and fringe benefits. Today, majority of organizations prefer market-based pay structure. PR Newswire (2012) quoted Kerry Chou, a Certified Compensation Professional and a practice leader at WorldatWork stating, "Market-based structures have struck a chord with organizations because they combine the more well-defined parameters of a traditional structure with the range spread flexibility of broad bands" (para. 2). In this pay structure, employers can make a job position pay level more or less competitive depending on...
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