Week 4 Discussion

South University

file:///C|/Users/CWATKIM/Desktop/Compensation.html[4/16/2020 3:18:27 PM]

Compensation Employee compensation is a critical area for the HR professional to assess continuously because it is linked to the employees’ performance. Employee compensation consumes much of the organizations’ operating budget. Since this is the case, it is essential that the organization conduct a talent search to hire the most qualified applicants, offer various reward programs to keep the employees motivated, and monitor the compensation plan periodically to retain skilled and knowledgeable staff. The organization must ensure that the expenses are relative to the overall operation budget.

The following companies offer a very engaging and comprehensive compensation plan: Google, Costco, Kaiser Permanente, Nestlé Purina, Microsoft, etc. Many of these organizations offer flexible benefit plans and great Work-Life- Benefits.

The HR professional has the opportunity to design a quality compensation program as long as the HR professional has a clear understanding of the mission, objectives, and the goals of the organization. The HR professional will decide if the business strategy will require a monetary incentive plan, nonmonetary, or both, in accordance with culture of the organization.

Other areas of concern are the legal aspects of the compensation plan, ensuring that the plan is equitable, fair, and not used as a method of discrimination on a particular class.

The HR professional must be able to establish a system to monitor and evaluate the employees’ salary as well as the executives’ salary, know when to use the pay-for-performance plan and conduct salary benchmarking to remain competitive.