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Brief Overview of Costco's Compensation System
Costco has a unique compensation system within its industry. The company competes as a cost leader, where it features low prices as a means of winning business. Cost leaders typically try to have rock bottom costs throughout their operations, from the supply chain to labor and everywhere in between. These competitors will use their bargaining power to get the cheapest labor possible, bargaining down wages, benefits and other perks. This often results in a poor quality labor pool with high levels of turnover, but these companies accept that as part of having a low cost labor pool and account for that is the design of the low cost business model (Lutz, 2013).
The approach that the company has to compensation is therefore counterintuitive to the way that most of its competitors run their human resources, but there is internal logic to Costco's…
Costco. (2014). Benefits. Costco. Retrieved May 31, 2014 from https://costcobenefits.com/cms/your-wealth/401k/index.shtml
Deci, E., Ryan, R. & Koestner, R. (1999). A meta-analytic review of experiments examining the effects of extrinsic rewards on intrinsic motivation. Psychological Bulletin. Vol. 125 (6) 627-668.
Goldberg, A. & Ritter, B. (2005). Costco CEO finds pro-worker means profitability. ABC News. Retrieved May 31, 2014 from http://www.sba.pdx.edu/faculty/susanm/semaccess/BA%20385/Costco%20CEO%20Finds%20Pro-Worker%20Means%20Profitability.doc
Gray, C. (2014). Tangible benefits of reducing turnover. Houston Chronicle. Retrieved May 31, 2014 from http://smallbusiness.chron.com/tangible-benefits-reducing-turnover-21668.html
Compensation Plan Outline
Ford Motor Company is the largest manufacturer of heavy commercial vehicles and second largest producer of automobiles in the world. Their range of vehicles comprises 70 different types that include Jaguar, Lincoln, Volvo, Mercury, Aston Martin, and Ford with presence in over 30 countries worldwide. Ford employs over 300,000 employees across the globe. In the United States itself, Ford has an employee strength nearing 100,000 employees and sales exceeding three million units (Joesph, 2003).
Compensation Plan of Ford Motor Company
Association with Ford Motor Company is a fulfilling experience for the workforce. The company offers motivation for exemplary work ethics, opportunities for individual and collective growth that translates into challenges to be met and overcome. The vast range of vehicles produced in the company provides the stimulus for development of the personnel at all levels, as does the cultural and regional diversity of the workforce itself. Ford…
Daniels Fund Ethics Initiative (2014).Ford Motor Company Manages Ethics and Social Responsibility. Retrieved from http://danielsethics.mgt.unm.edu/pdf/ford-motor-case.pdf
Ford Motor Company (2014). Notice of 2014 Annual Meeting of Shareholders and Proxy Statement. Retrieved fromhttp://corporate.ford.com/doc/457/143/ir_2014_proxy.pdf
Ford Motor Company (2011). Summary of Compensation and Benefits for Ford Motor Company. Retrieved from http://corporate.ford.com/doc/r-full-time-benefits.pdf
Joseph, B.S. (2003). Corporate ergonomics program at Ford Motor Company, Applied Ergonomics, 34, 23-28. Retrieved from http://www.sciencedirect.com/science/article/pii/S0003687002000807
The sales person is driven by their target, as to fail to meet the target would not only be financially costly but embarrassing. The second target, the hard-to-achieve target -- is something that the salesperson can take pride in achieving. Attaining this target means more for the success and improvement it represents than for the payout that comes along with it.
The third component is the Top Performer incentive. For some sales staff, this may not serve as significant motivation as they may not feel as though they are in contention. For those high-performing staff members, however, this award gives the opportunity for bragging rights -- fulfillment of the ego. This can be powerful motivator for sales people. This incentive will work for the strong sales people, so while the others may not push themselves to attain it, all of the best sales people will and in doing so they…
New compensation plan for the employment team
As a result of the changes which have recently been implemented within InterClean, a new need arises in the necessity to align the compensation plan with the new organizational features. In other words, the changes implemented would only succeed if they are adequately supported by the staff members and a means of attaining employee support in times of organizational change is that of readdressing compensation issues (Lamm, Gordon and Purser, 2010).
Given this situation, the current endeavor proposes a new compensation plan based on the following:
A guaranteed minimum wage established for all of the team members
Additional wage increases based on specific employee features, such as experience, loyalty to the firm or level of education acquired
Premiums and bonuses based on performance
Non-financial compensations, such as flexible working schedules or the offering of training programs.
The above presented pay system stands…
Carlson, D.S., Bozeman, D.P., Kacmar, K.M., Wright, P.M., Mcmahan, G.C., 2000, Training motivation in organizations: an analysis of individual-level antecedents, Journal of Managerial Issues, Vol. 12, No. 3
Lamm, E., Gordon, J.R., Purser, R.E., 2010, The role of value congruence in organizational change, Vol. 28, No. 2
Mellor, E.F., 2002, Shift work and flexitime: how prevalent are they? Monthly Labor Review, Vol. 109
managerial decisions: Structuring compensation plans
Economics / Chapter 14
Firms attempt to create attractive compensation plans in order to retain as well as motivate qualified employees. These compensation plans will vary among firms due to factors such as the nature of the product, competition, and location. In this particular case, Kaufmann's is a large chain department store which carries a broad range of products with a target of middle income consumers. With the knowledge that middle income consumers tend to spend more of their money on goods and services, this would tend to mean that there is the possibility for them to sell more goods than Parkleigh Pharmacy, as Parkleigh Pharmacy sells very expensive products. Taking this into consideration, Kauffmann's offering a five percent commission on sales will motivate the sales person to increase sales. This will in turn benefit Kaufmann's, as it would increase its sales revenue. On the…
Fischer, S. (Ed.). (1986). National Bureau of Economic Research Macroeconomics
Annual (Vol.1). Massachusetts: MIT Press.
Polachek S., & Siebert, W.S. (1993). The Economics of Earnings. Massachusetts:
Human esources Pay Package
Employee Compensation Plan
Target Job: egistered Nurse (N) in a Hospital
Hillcrest Hospital is a 496 bed hospital located in Mayfield Heights, a Cleveland Ohio Suburb. Hillcrest is ranked in the nation's top 100 in cardiac care. It is part of the Cleveland Clinic system. The mission of the hospital is to provide nationally ranked healthcare to the surrounding community. It holds clinical excellence, safety, ethics, integrity, individual responsibility, respect for diversity and caring for others as key tenets (Hillcrest Hospital, 2012a). Its vision is to service as an example of state-of-the-art medical facility in every department that delivers consistent high quality service to Northeast Ohio (Hillcrest Hospital, 2012b). The Cleveland Clinic system is one of the best renowned systems in the nations in a number of specialties in which they operate.
Hillcrest Hospital strives to put their patients first and looks for enthusiasm in employees.…
Bureau of Labor Statistics. Occupational Outlook Handbook, 2010-2011Edition. Registered Nurses. Retrieved from http://www.bls.gov/oco/ocos083.htm
Hillcrest Hospital (2012a). Mission. Retrieved from http://www.hillcresthospital.org/AboutHillcrestHospital/Mission/tabid/574/Default.aspx
Hillcrest Hospital (2012b). Vision. Retrieved from http://www.hillcresthospital.org/AboutHillcrestHospital/Vision/tabid/575/Default.aspx
Hillcrest Hospital (2012c). Hillcrest-Hospital-Jobs. Retrieved from http://www.clevelandclinic-jobs.com/go/Hillcrest-Hospital-Jobs/28206/
organization's ability to recruit and retain talented employees requires ensuring employees are rewarded proportionately for their contribution towards achieving organizational goals and profitability. To achieve this, a benefits and compensation policy is developed and implemented for all workers. This company has established a compensation policy that offers a full range of conventional benefits, dental, vision and medical benefits in addition to a rewards program that offers incentives based on employees' input. However, there are numerous complaints from the workforce that these benefits do not effectively address a growing problem. To address this growing problem, it's important to develop a Benefits and Compensation plan that offer packages that correspond to the employee type, reflects the organization's culture, and is comparable to the company's competitors.
Components of the Benefits and Compensation Plan
The current benefits and compensation plan is seemingly ineffective because it does not provides benefits and compensation based on the…
Dunne, P.M., Lusch, R.F. & Carver, J.R. (2014). Retailing (8th ed.). Mason, OH: Cengage Learning.
Linton, I. (n.d.). Basic Responsibilities for Retail Workers. Retrieved October 14, 2016, from http://smallbusiness.chron.com/basic-responsibilities-retail-workers-36997.html
White, M.C. (2014, April 27). The Many Ways Retailers Pay and Reward Employees. Retrieved October 14, 2016, from http://www.jckonline.com/2016/02/19/many-ways-retailers-pay-and-reward-employees
The company I have chosen is Starbucks. The two positions within the company are barista and assistant store manager. The compensation plans for these two positions will be compared.
There are many similarities between these two plans, based on the way that Starbucks has designed all of its compensation plans. However, there are some differences. One of the biggest differences is that the barista position is typically an hourly position, based on part-time work usually. The company's compensation plan is designed around the principle of base pay for all positions, with some positions being eligible for bonuses. The latter are typically the salaried positions of which assistant store manager is one. The barista has an incentive to perform because performance creates opportunities at higher levels of the organization, and move upwards from an hourly position. Managerial roles within the company are eligible for performance-based bonuses, as there are…
Kappel, M. (2012). What is internal equity? Patriot Software. Retrieved June 7, 2014 from http://www.patriotsoftware.com/small-business/blog/what-is-internal-equity/
Starbucks (2014). Your special blend. Starbucks. Retrieved June 7, 2014 from http://globalassets.starbucks.com/assets/13aefdbe8b2c4da8856116c1fd5fe54c.pdf
Employee Contributions 30/05/2015
Two methods an H professional could use to determine incentive pay
Legally mandated benefits that the company must currently offer to its employees
Additional benefits that should be considered for its employees
Efficiency of common techniques for communicating compensation plans to employees.
Ethical risks of incentive pay and recommendations to mitigate the risks.
Two methods an H professional could use to determine incentive pay
There are a number of methods that are generally used by companies to link work, output and expertise to the remuneration of the employees. In this section we examine two methods that can be used by the company to create more loyalty among the employees to stay back in the company through the increasing in pay.
The reward management practices would help the company to determine the amount that would be paid to the employees. The underlying principal is that the company would…
Hoffmann, F., Inderst, R., & Opp, M. Regulating Deferred Incentive Pay. SSRN Journal. doi:10.2139/ssrn.2284337
Rosenbloom, J. (2001). The handbook of employee benefits. New York: McGraw-Hill.
Rosenbloom, J. (2011). The handbook of employee benefits. New York [u.a.]: McGraw-Hill.
Schraeder, M., & Becton, J. (2015). An Overview of Recent Trends in Incentive Pay Programs. The Coastal Business Journal, 2(1), 18-25.
Compensation Components Offered at a Foreign Work Site
The compensation components offered to an employee of a U.S. company with the opportunity to take a job at a foreign work site availed through some form of an insurance plan. An important set of components is always non-insurance based and provides income to the employees at a foreign work site. These benefits can be classified into three major segments:
Loss of job income continuation
Disability income continuation
Accident and health protection
Liability and property protection
A special set of services and benefits known as prerequisites (Henderson, 2006).
All the categories contain various compensation components with various features given to an employee of a U.S. company with the opportunity of working at a foreign work site.
Disability income continuation
Disability can be categorized as temporary, singular, partial, or total. When the employee is unable to work because of some health related problem…
Henderson, R.I. (2006). Compensation management in a knowledge-based world (10th ed.). Upper Saddle River, NJ: Prentice Hall.
Goel, D. (2008). Performance appraisal and compensation management: A modern approach. New Dehli: Prentice-Hall of India.
In the past, Payless was hesitant to determine salary increases on individual performance, because of the possibility of demoralizing employees. However, the company decided to follow other companies, because it helps retain top performers and provides more a greater degree of accountability in the corporate culture (Marquez, 2006).
s a result, at Payless, the average salary increase for high performers jumped from 9.5% in 2004 to 9.9% in 2005, while the average merit increase only rose 0.2% over the same period. Payless' new program requires its 12 business unit leaders to create a "nine box," with each box detailing an employee profile, how the manager should address the employee's performance and growth potential and what the range of the salary should be. One box may have the name of an employee who is out the door for not performing well enough and another box may have a top performer who…
As a result, at Payless, the average salary increase for high performers jumped from 9.5% in 2004 to 9.9% in 2005, while the average merit increase only rose 0.2% over the same period. Payless' new program requires its 12 business unit leaders to create a "nine box," with each box detailing an employee profile, how the manager should address the employee's performance and growth potential and what the range of the salary should be. One box may have the name of an employee who is out the door for not performing well enough and another box may have a top performer who is getting a huge increase (Marquez, 2006). Both of these companies say it is too early yet to know if this change in compensation approach will be a positive or negative.
There have always been certain professions that felt more comfortable or expected working this way, such as salespeople. Sales compensation can be distinguished from other employee pay programs because salespeople have a direct and measurable impact on the company's revenue. This impact creates the opportunity to directly hinge a salesperson's individual performance as it relates to developing a positive impact on the business by: 1) Supporting the company's marketing and selling plans;
2) Communicating performance expectations; 3) Influencing the efforts and behaviors of employees engaged in the selling process by rewarding based on performance outcomes, and 4) Contributing to the
Q12. Describe the impact of legislation on the field of compensation management.
Minimum wage and overtime laws restrict the minimum amount employers can offer to workers; anti-discrimination legislation mandates that employees are compensated without regards to their racial, ethnic, gender, or disabled status.
Q13. Identify the impact of incentives such as bonuses to a compensation program.
For some professions, such as sales and investment banking, bonuses derive the bulk of the individual's expected salary. Bonuses can also be a means of distinguishing social status between employees. Bonuses can also simply be used to encourage higher levels of performance, based upon short-term outcomes.
Q14. Explain how the global market affects U.S.-based companies' compensation.
In a global marketplace, high-quality employees are more 'portable,' but because of the ability to outsource labor, employees may also find their salaries kept artificially low through the availability of lower-cost foreign workers.
Q15. Describe salary/market surveys.
Compensation Improvement Company ABC
The goal of this review will be to examine the overall objectives of the pay model for ABC corporation, a small manufacturing plant that specializes on developing nanosecond electronic components for select suppliers. As a job analyst my position requires that I evaluate each position in the company and ensure that a compensation structure is developed that is in line with the strategic goals and objectives of the organization which include having the workforce reflect the diversity in the community.
The use of automation and high tech systems has enabled the workforce to remain relatively low, less than 100, and may even substantially reduce the workforce in the upcoming years. The number of employees that must be reduced may be limited if employees are offered alternative forms of compensation rather than pay based incentives, which will decrease the overall financial burden on the company at large.…
Crafting a Compensation and Benefits Plan
Fishers is a mid-sized manufacturing company out to maintain market leadership through the development and implementation of a compensation plan that meets the needs of the owners, clients, as well as employees. Compensation programs are critical to the effectiveness of the organization as they play a fundamental role in employee motivation, satisfaction, and productivity. The company seeks to achieve two crucial objectives from the implementation of this compensation and benefits plan; i) to reduce turnover, which has been an imminent problem over the last couple of years; and ii) to attract new talent, while retaining and improving the existing one.
The company is at a critical juncture; it can no longer offer the perks of a small entrepreneurial enterprise since it has exceeded the employee threshold for such categorization. Employees have been complaining over what they think is below-market compensation, and…
Basset-Jones, N. & Lloyd, G.C. (2005). Does Herzberg's Motivation Theory have Staying Power? Journal of Management Development, 24(10), 929-943.
Beam, B.T. & McFadden, J.J. (2012). Employee Benefits (6th ed.). Chicago, IL: Dearborn Trade Publishing.
Cappelli, P. (2011). Why Good People can't Get Jobs: the Skills Gap and What Companies do about It. Pennsylvania, PA: Wharton Digital Press.
Miner, J.B. (2007). Organizational Behavior 4: From Theory to Practice. New York M.E. Sharpe.
Offering benefits such as healthcare and even stock options to lower-level employees, a compensation strategy also pursued by Starbucks (a company both literally and figuratively 'green' in its image), is another example of a policy that can benefit both the company and employees -- employees enjoy greater security, while the companies reduce the high rate of workplace turnover that is endemic to the service industry at companies like McDonald's. In fact, as Eric Schlosser observed in Fast Food Nation, fast food companies have often deliberately made life unpleasant for lower-level employees, to reduce the need to offer them promotions, benefits, and higher pay, on the theory that it is easy to train a new worker to operate a cash register. "How can workers look to this industry as a career…when it pays them the minimum wage and provides them no health benefits" (Schlosser 2001, p. 88). hole Foods and Starbucks…
"Benefits." Google website. February 8, 2010.
"Careers." Whole Foods Market. February 8, 2010.
Starbucks is a quick service restaurant that focuses on coffee and snacks. The company operates globally, with over 18,000 stores, roughly 55% of which are company-owned and the rest are franchised. Over 10,000 of these stores in are in the United States. Starbucks earned $14.89 billion in revenue in the last fiscal year (2013 Starbucks Annual eport). Starbucks employees are known as associates. In total, there are 191,000 associates (full-time equivalent) in the Starbucks system, most of whom work at the retail level (MSN Moneycentral, 2014). For this reason, this paper will mainly focus on the human resources policies that apply at the retail level.
The basic business strategy that Starbucks follows is differentiation. The company seeks to provide a unique mix of product and service offerings that distinguish it from other locations where consumers can acquire coffee and snacks. The basic commodity, coffee, is difficult to…
2013 Starbucks Annual Report. In possession of the author.
Caldicott, S. (2014). How the minimum wage is reshaping workforce strategies. Forbes. Retrieved December 2, 2014 from http://www.forbes.com/sites/sarahcaldicott/2014/07/18/will-starbucks-eat-mcdonalds-lunch-how-the-minimum-wage-is-reshaping-workforce-strategies/
Martel, L. (2003). Finding and keeping high performers: Best practices from 25 best companies. Employment Relations Today. Vol. 30 (2003) 27-43.
Moroko, L. & Uncles, M. (2008). Characterstics of successful employer brands. Journal of Brand Management. Vol. 16 (2008) 160-175.
I believe that Keith was entirely justified in insisting that the job, not the person, be evaluated. If a company has established protocol, then that protocol should be followed. The receptionist in question has a boss who is in charge of evaluating her performance on a regular basis; the committee would likely be overstepping its boundaries if they had decided to evaluate a single person, rather than the position they were intended to evaluate. Keith would likely be justified in reminding the other committee members of their responsibilities and duties regarding the committee's purpose.
Initially, Keith was bothered by the possibility of a confrontation at the meeting with certain committee members. It would therefore behoove Keith to approach the situation with care and consideration, while maintaining a sense of balance and humbleness. One thing that Keith does not want to do is approach the other members of the committee…
Baumann, A. & Kolotylo, C.; (2009) The professionalism and environmental factors in the workplace questionnaire: Development and psychometric evaluation, Journal of Advanced Nursing, Vol. 65, Issue 10, pp. 2216-2228
Johnson, R.E.; Silverman, S.B.; Shyamsunder, A.; Swee, H.Y.; Rodopman, O.B.; Cho, E.; Bauer, J.; (2010) Acting superior but actually inferior?: Correlates and consequences of workplace arrogance, Human Performance, Vol. 23, Issue 5, pp. 403 -- 427
Roberts, G.E.; (2001) An examination of employee benefits cost control strategies in New Jersey local governments, Public Personnel Management, Vol. 31, pp. 301 -- 315
Tocher, N.; Field, H.S.; Giles, W.F.; (2006) Valuations of compensation and benefit items by new entrants into the professional workforce: Do men and women differ?, Journal of Employment Counseling, Vol. 43, Issue 2, pp. 84 -- 96
Compensation in Wachovia Bank's Base Employee Tier
Bank Teller Pay
Compensation in Wachovia Bank's Base Employee Tier
Banking Industry Practices
etention ates for Tellers
Opportunity Cost for Promotion
Consideration of Drawbacks
Compensation of tellers at Wachovia Bank is closely tied to turnover rates. Employee turnover is costly because resources must be expended to replace employees who leave. ecruitment and training can be expected to be approximately one-third of an employee's salary. In the banking industry, the turnover rate for tellers also impacts the bank's ability to efficaciously cross-sell investment products. High turnover rates of promotable employees contribute to increased expenditures by the human resources department since searches must be orchestrated with outside executive search consultants. The banking industry is in survival mode. In order for Wachovia Bank to survive in this industry, we must take care of our frontline. The frontline of Wachovia Bank is our tellers. A…
Careers: Teller, (2011). Wells Fargo / Wachovia [Web] Retrieved https://www.wellsfargo.com/careers/fit/opportunities/teller
Hourly rate snapshot for bank teller jobs, PayScale. (n.a., n.d.) [Web] Retrieved http;//www.payscale.com/research/U.S./Job=Bank_Teller/Hourly_Rate
Looking for research on the cost of staff turnover? (2011). LinkedIn. [Discussion] Retrieved http://www.linkedin.com/answers/management/business-analytics/MGM_ANA/
612746-20209499 [Chartered Institute of Personnel and Development (CIPD) in the UK]
The current plan is a defined contribution plan, but the employees are not using it effectively. Many are heavily weighted in money market, and over 70% of employees are not even making contributions. Both of these problems need to be addressed.
The first question that should be raised with senior management is whether to offer a defined benefit plan, rather than a defined contribution plan. Part of the reason that many employees do not use the plan is that they probably do not truly understand the plan. A defined benefit plan is much easier to understand for employees because it gives them a set benefit (DOL, 2012). The risk in a defined benefit plan, however, is on the company, whereas with a defined contribution plan the risk falls to the employees. So from the company's point-of-view it is probably better to have the current plan, and maybe we just…
DOL. (2012). Retirement plans, benefits and savings. United States Department of Labor. Retrieved April 23, 2012 from http://www.dol.gov/dol/topic/retirement/typesofplans.htm
Ramsay, L. (n.d.). Compensation and benefits as recruitment and retention tools: The impact of the downturn. SHRM. Retrieved April 23, 2012 from http://www.shrm.org/Research/FutureWorkplaceTrends/Documents/Spotlight%20Q2%202009.pdf
Compensation and Benefits: The Family and Medical Leave Act
The Family and Medical Leave Act (FMLA)
The FMLA came into effect on 5th August, 1993. The Wage and Hour Division of the U.S. Department of Labor (DOL) is responsible for its administration. The law covers all employees in the state, including those in the private sector and a majority of those in the congressional and federal sectors. The law entitles "eligible employees of covered employers to take up to 12 weeks of unpaid leave per year," in order to attend to specified medical and family issues (AFSCME, 2013). This could extend to 26 weeks, over the same period, in cases that involve serious illness or injury. The decision as to when the one-year period should actually begin is dependent on the employer and the policy of the organization. In the past, the FMLA has been amended a number of times…
AFSCME. (2013). The Family and Medical Leave Act. AFSCME. Retrieved from http://www.afscme.org/members/education-and-trainings/education-resources/fact-sheets/the-family-and-medical-leave-act-fmla
American Society of Employers. (2012). 2013 Employment and Labor Law Legislation. American Society of Employers. Retrieved from http://www.aseonline.org/ResearchbrnbspServices/EmploymentandLaborLawLegislation.aspx
United States Department of Labor. (2013). Family and Medical Leave Act. United States Department of Labor. Retrieved from http://www.dol.gov/WHD/fmla/2013rule/
Compensation Strategy for a Limo Service
The compensation strategy and benefits strategy for a limousine service in Austin, Texas will represent an essential component to the overall business strategy. The projected annual net revenue for the first years of the business is a negative fifty thousand dollars. Therefore any potential savings in employee compensation might represent something that could reduce this financial burden. Furthermore, any amount of compensation that would go beyond the planned amount would increase the company's loss. Creating an efficient strategy for compensation and benefits will be exceedingly important in the company's first year because it is expected to operate at a loss.
The compensation and benefits strategy will also be important because it will largely influence the quality of the candidate pool that the company will have to select its employees from. Higher wages will draw more qualified candidates and a lower compensation package might reduce…
CCLAustin.com. (2015, July 25). Limousine Driver. Retrieved from Indeed: http://www.indeed.com/cmp/1821,-LLC/jobs/Limousine-Driver-caa563266df09236?sjdu=QwrRXKrqZ3CNX5W-O9jEvc_0arWZVL8kBZq_BJ55IeacX4zQS5v9EEfHtSBIrvbSgRNqfatL5qHmPK9ugjQ-5w
Pay Scale. (2015, July 2). Limousine Driver Salary. Retrieved from Pay Scale: http://www.payscale.com/research/U.S./Job=Limousine_Driver/Hourly_Rate
Given the long hours and the large quantity of information the employees at the Fit Stop will have to acquire, it is only natural for the management to offer the a wide series of incentives aimed to increase their performances and ensure the complete satisfaction of customers' needs, all to the overall benefit of the organization. Founder Susan Superfit could offer a fixed payment plan, plus sales commissions, plus other financial and non-financial incentives. She should also constantly analyze the markets as to identify new trends in rewarding the staff but also to identify the strategies implemented by the competition.
Wyatt, W., Compensation Trends in Canada, Watson Wyatt Data Services Canada, http://watsonwyatt.com/lastaccessed on April 19, 2008
Compensation: Outline and Definitions, H Guide to the Internet, 1998, 1999, 2000, last accessed on April 19, 2008
Pay Systems, ACAS, etrieved from www.acas.org.uk/media/pdf/p/0/B02_1.pdfonApril 19, 2008
The Fit Stop, Strategic Compensation in Canada,…
Wyatt, W., Compensation Trends in Canada, Watson Wyatt Data Services Canada, http://watsonwyatt.com/lastaccessed on April 19, 2008
Compensation: Outline and Definitions, HR Guide to the Internet, 1998, 1999, 2000, last accessed on April 19, 2008
Pay Systems, ACAS, Retrieved from www.acas.org.uk/media/pdf/p/0/B02_1.pdfonApril 19, 2008
The Fit Stop, Strategic Compensation in Canada, Case for Analysis
Compensation and Benefits Package for a Secretary
A pharmaceutical company has recently hired a new director for its human resource department as part of its initiatives to enhance productivity and organizational success. The company is also seeking to hire a new secretary for the H department and develop an employee compensation and benefits package for this position. This package will be utilized for the position of secretary for the H department once a suitable candidate is hired. Generally, pharmaceutical companies hire educated and highly talented individuals because of the nature of their operations, which requires high academic qualifications. In essence, the need for high academic qualifications for this industry is fueled by the fact that these professionals deal with patients whose needs are constantly evolving. The development of a suitable compensation and benefits package for a H secretary in this pharmaceutical company requires examining compensation and benefits packages in the…
Bureau of Labor Statistics. (2014, January 8). Occupational Outlook Handbook -- Pharmacists. Retrieved from U.S. Department of Labor website: http://www.bls.gov/ooh/healthcare/pharmacists.htm
"Human Resources: Compensation, Benefits & Reward." (n.d.). All About Careers Ltd. Retrieved December 11, 2015, from http://www.allaboutcareers.com/careers/career-path/human-resources-compensation-benefits-reward
UCSF Human Resources. (n.d.). Chapter 11: Employee Development & Training. Retrieved University of California, San Francisco website: http://ucsfhr.ucsf.edu/index.php/pubs/hrguidearticle/chapter-11-employee-development-training/
The author of this report is asked to analyze and summarize the compensation plan of Merck Corporation, how it can be better, what they are doing right and what they are doing wrong. Inclusive in that will be an overall evaluation of their current plan, the beneficial ratio of internally consistent and market-consistent compensation systems, an evaluation of the current pay structure, two overall recommendations that the author of this report feels that Merck can and should undertake and the types of employer-sponsored retirement plans and/or health insurance plans that Merck makes use of as compared to that of competitors like Johnson & Johnson and others. While Merck, like most other companies, should always work to fine-tune and perfect their compensation plan, Merck is actually going quite well as made possible by their market and internal research as well as its wealth of resources and options that they…
Herper, M. (2013, April 17). Merck Could Return To Greatness If CEO Can Leave His Own Past Behind. Forbes. Retrieved February 28, 2014, from http://www.forbes.com/sites/matthewherper/2013/04/17/merck-could-return-to-greatness-if-ceo-can-leave-his-own-past-behind/
McIntyre, D. (2013, December 5). Can Walmart and McDonald's Afford a $15 Minimum Wage?. Yahoo Finance. Retrieved February 28, 2014, from http://finance.yahoo.com/news/walmart-mcdonald-afford-15-minimum-111559234.html
Merck. (2014, February 28). Merck.com. Merck.com. Retrieved February 28, 2014, from http://www.merck.com
Thurm, S. (2013, March 20). 'Pay for Performance' No Longer a Punchline. The Wall Street Journal. Retrieved February 28, 2014, from http://online.wsj.com/news/articles/SB10001424127887324373204578372444079319544
Total Compensation Methods
Impact of various compensation methods and benefit programs on employees and organizations.
The compensation term is used for the combination of salaries, benefits and wages for the employee. It also includes hourly or annual salary, bonuses, benefits and incentives like short-term disability insurance, retirement plan and health coverage. Thus, a comprehensive package includes a combination of different components. The collection of all components is relevant to "Employee Compensation Plan" along with the way of payment and the reasons individuals collect salary increases, incentives and bonuses (Milkovich and Newman, 2005).
Employees who are not exempted, receives hourly wages with an addition of overtime payment for working more than 40 hours in a week. The rate of overtime to hourly wages is one and half. Employees having a bargaining and collective contract with the management have already set wages according to the contract for certain period and…
Conrad DA, Christianson JB. Penetrating the 'Black Box': Financial Incentives for Enhancing the Quality of Physician Services. Medical Care Research and Review. 2004;61(3, Suppl):37S -- 68S
Hadley J, Reschovsky J. Medicare Fees and Physician's Medicare Service Volume: Beneficiaries Treated and Services per Beneficiary. International Journal of Health Care Finance and Economics. 2006.
Kukreja, P. (2011). Employee Retention of McDonald's. Taken from: http://www.managementparadise.com/forums/human-resources-management-h-r/219372-employee-retention-mcdonald-s.html
Milkovich, G.T. & Newman, J.M. (2005). Compensation. 8TH Edition. Chicago: Irwin.
In Eric Borden's case, his knowledge of the industry and of the developments that occur on this segment recommends him either for the research and development department or for marketing, since he would be able to ensure that the marketing strategy that the company has is in line with what occurs on the markets. From that perspective, his salary structure could be changed so as to ensure that he receive an increased base salary rather than the sales bonus program he receives now.
In the case of Ving Hsu, his financial package needs to be adjusted, because he currently works as a sales representative, but receives only the base salary, although he is eligible for the sales bonus. However, it seems that much of his activity is focused on training his customers on how to use the products rather than on increasing his volume of sales. A more relevant measure…
In the case of retirees of 65 and over, it decreased from 7.5% in 2007 to 6.36% in 2008. The rate to which the cost trend is assumed to decline was maintained at a constant level of 5% in 2007 and 2008.
Given the company's financial situation and the current global economic conditions, it is estimated that the compensation and benefit costs will decrease in the following years. The company estimated the following evolution:
Pension benefits: $4,964 in 2008, $4,841 in 2009, $4,864 in 2010
Postretirement benefits: $2,520 in 2008, $2,636 in 2009, $2,733 in 2010
Medicare subsidy receipts: $120 in 2008, $130 in 2009, $140 in 2010
The company is very active in the stock-based compensation plan. This type of compensation is encouraged by the company's board of directors. The compensation cost in 2005 reached $143, in 2006 it reached $301, and in 2007 it reached $720.
McNamara, Carter (2008). Employee Benefits. Adapted from the Field Guide to Leadership and Supervision. Retrieved February 19, 2009 at http://www.managementhelp.org/pay_ben/benefits/benefits.htm .
Annual Report (2007). at&T. Retrieved February 20, 2009 at http://www.att.com/Investor/ATT_Annual/downloads/07_ATTar_FullFinalAR.pdf .
Executive Stock Option Plans
"If the company does not do better than its competitors, but the stock market goes up, executives do very well from their stock options. This makes no sense." Discuss viewpoint. Can you think of alternatives to the usual executive option plan that take the viewpoint into account?
Executive stock options are performance-based incentive plans that became popular in the 1950s and 1960s. They declined due to the stock market crash of the 1970s, but returned aggressively returned in the 1990s (Kole, 1997). Today, most companies grant stock options to their top officers as part of executive compensation, along with salary and bonuses. Options that are awarded as part of a compensation package can be very valuable to executives when stocks are performing well. The challenge comes in when stock value is realized for executives even when a company is not faring well at all. This is…
Cicero, D.C. (2009). The manipulation of executive stock option exercise strategies: Information timing and backdating. Journal of Finance, 64(6), 2627 -- 2663.
Collins, D.W., Gong, G., & Li, H. (2009). Corporate Governance and Backdating of Executive Stock Options. Contemporary Accounting Research, 26(2), 403-445.
Hamilton, S. And Wise, D. (2008). Adding performance criteria to your stock options. Hay Group. Retrieved from http://220.127.116.11/haygroupusmkting/e_article001162460.cfm.
Hess, D. (2012). More Stock Rewards Tied To Performance. Crain's New York Business, 28(31), 0015.
Direct Compensation and Fringe Benefits
Fringe benefits refer to those elements of the total compensation package which are apart from the monetary payment made to an employee by the employer (Schuler and Jackson, 1996). These can include "employer's contribution to social security, workers compensation, unemployment compensation, health, life and dental insurance, private pension plans and cafeteria style benefits plan. " (Brookshire and Smith, 2008 p. 69)
Unionized organizations have often been faced with the problem of choosing between fringe benefits and direct compensation. But over the years, this trend has also been witnessed in non-unionized organizations where employees demand more monetary compensation as opposed to fringe benefits believing that the latter do not matter as much as the former. This has had companies in a quandary: should they let go of fringe benefits when some employees do not seem to value them?
The answer is an emphatic" No" in my…
Michael L. Brookshire and Stan Smith, 2001 Economic/Hedonic Damages: The Practice Book for. Plaintiff and Defense Attorneys (Cincinnati: Anderson Publishing
Berger, L. Berger, D. 2000. The compensation handbook: a state-of-the-art guide to compensation strategy and design. McGraw-Hill Professional, 2000 - Business & Economics - 646 pages
Despite Crystal's criticisms of executives earning outrageous sums of money that are not linked to their performance, the reality is that most executives have a compensation package that is based on performance in some way or another (Codon and Lynch, 2004). However, the use of stock options and other equity-based incentives create enormous incentives to manage the performance of companies for short-term stock price gain. This often comes at the expense of strategy implementation that could sacrifice profits in the short-term for long-term benefits. Also, underlying executive actions there may be the desire for personal wealth, not the strength of the corporation obtained through a well thought out strategic plan.
Of the recommendations offered in the case, the two that are the most promising are linking pay to long-term profitability and putting workers on the boards of directors. Instead of being pressured to make quarterly and annual profits,…
Codon, D. And Lynch, D. (2004, January). Recent developments in executive compensation. The Corporate Compliance and Regulatory Newsletter, Vol 1. No. 5. Retrieved June 26, 2005 from Web site: http://www.rkmc.com/pdf/exec_compensation.pdf
Glassner, F. (2002, March 6). Who is to blame for outrageous executive pay? One less Barbie dream house won't hurt anyone. HRM Guide. Retrieved June 26, 2005 from Web site: http://www.hrmguide.net/usa/rewards/rewarding_performance.htm
Other acts include the Federal Employment liability Act, the Marchant Marine Act and the Longshore and Harbor Workers' Compensation Act.
There are also workers compensation acts that are geared towards problems associated with illnesses or health concerns that have arisen from working in certain industries. One example of this is the Black Lung Benefits Act. This particular act provides compensation for miners who acquire www.nlm.nih.govPneumoconiosis a lung disease that develops over time as a result of ingesting coal, graphite, or man-made carbon dusts (Coal worker's pneumoconiosis). This particular act ensures that mine operators compensate workers in the form disability payments and creates a fund managed by the Secretary of Labor (Workers Compensation). The fund is responsible for supplying disability payments to miners in cases where the mine operator is not known or does not have the ability to pay (Workers Compensation).
As you can see worker's compensations takes on many…
Coal worker's pneumoconiosis. Retrieved February 18, 2008 from; http://www.nlm.nih.gov/medlineplus/ency/article/000130.htm
Insurance Glossary. Retrieved February 18, 2008 from; http://www.kanetix.com/glossary-of-insurance-terms
United States Department of Labor, Workers Compensation. Retrieved February 18, 2008 from; http://www.dol.gov/dol/topic/workcomp/
Workers Compensation. Retrieved February 18, 2008 from; http://www.law.cornell.edu/wex/index.php/Workers_compensation
Broadbanding: Compensation of a "Different Color"
In a 1997 survey reported by the American Federation of State, County and Municipal Employees, more than two-thirds of state government personnel managers indicated they "would like to change their state's salary and classification systems" (http://www.afscme.org/wrkplace/cbr2971.htm). They believed that their governments had far too many job titles, far too few people filling each title, and outmoded salary systems (some over two decades old). But what kind of solution would help companies win that "numbers game"?
Enter "broadbanding," the practice of structuring job classifications to have fewer "layers" than a traditional compensation system. For example, a company that starts out with eight layers compresses those layers to four broader ones, creating a new set of job classifications that grou p
similar skill sets and skilled personnel together. Overnight (or so it can seem), a company's entire compensation picture shifts, its grades change, and the "lay…
Auxillium West - The HR Manager - Broadbanding. 2001, Auxillium West. .
Broadbanding . 2002, American Federation of State, County and Municipal Employees, AFL-CIO. .
Jackson, John H., and Mathis, Robert L. Human Resouce Management. 9th Ed. South-Western Thomson Learning, 2000. pgs. 422-424.
Incentive Plan at Watson Pharmaceutical
Watson Pharmaceutical Company is located in Corona, California and is a leading company worldwide for pharmaceutical products. The organization develops, manufactures, markets and distributes generic pharmaceutical drugs specialized in women's health and urology, in the United States and throughout the world ("About Watson," 2010). Watson utilizes an incentive plan to motivate their employees to work harder and achieve their sales goal. The incentive plan motivates the employees to achieve their individual goals, allowing the organization to accomplish the organization goals. This is a strategy that is utilized by many organizations in pharmaceutical industry, as well as other sales agents. In this paper I will discuss Watson's incentive plan and how it is utilized to achieve the organization goals.
Incentive plans are extremely popular in the pharmaceutical industry. This is short-term compensation for achieved sales goals and increased revenue (Morningstar, 2011). Watson Co. utilizes…
About Watson. (2010). Retrieved from http://www.watson.com/about.asp
Custers et. al. (2008). Selecting effective incentive structures in health care: A decision framework to support health care purchasers in finding the right incentives to drive performance. BMC Health Services Research. 8 66-72
HR Focus (2001). Incentive Pay Plans: Which Ones Work and Why? HR Focus 78 (4) 3-5
Morningstar (2011). Big Pharmma Incentive Model Flawed, According to New Research from Hay Group. Retrieved from http://news.morningstar.com/all/business-wire/20110318005825/big-pharma-incentive-model-flawed-according-to-new-research-from-hay-group.aspx
Strategic Human esource Management in Small and Growing Firms: Aligning Valuable esources" by Michael B. Hargis and Don B. Bradley (July 2011)
Hargis, M. B. & Bradley, D. B. (2011, July). Strategic human resource management in small and growing firms: Aligning valuable resources. Academy of Strategic Management Journal, 10(2), 105-110.
According to Hargis and Bradley, there is a growing body of evidence that many of the same types of human resource management challenges that are experienced by larger corporations are no different than those encountered by smaller firms, including the need to identify optimal compensation and reward packages that will help recruit and retain talented employees. At present, though, there remains a dearth of timely and relevant research concerning the impact that human resource management practices have on the performance of small companies. To help fill this gap in the body of knowledge, Hargis and Bradley review…
Resources" Hargis and Bradley cite the need for additional research concerning optimal compensation and reward practices in small businesses and draw on a national sample to highlight various strategies that have proven effective -- and ineffective -- in helping small companies address many of the same types of problems that are experienced by their larger counterparts. The presentation of typical strategies currently that are being used by small businesses makes this a particularly useful study for practitioners interested in small to medium sized enterprises.
The statement regulating accounting for stock-based compensations defines a fair value-based method of accounting for an employee stock option or similar equity instrument and encourages all entities to adopt that method of accounting for all of their employee stock compensation plans. However, it also allows an entity to continue to measure compensation cost for those plans using the intrinsic value-based method of accounting prescribed by APB Opinion No. 25, Accounting for Stock Issued to Employees. The fair value-based method is preferable to the Opinion 25 method for purposes of justifying a change in accounting principle under APB Opinion No. 20, Accounting Changes. Entities electing to remain with the accounting in Opinion 25 must make pro forma disclosures of net income and, if presented, earnings per share, as if the fair value-based method of accounting defined in this statement had been applied.
Stock options are the most frequently used method in…
Cadbury, Sir a. 1992. Committee on the Financial Aspects of Corporate Governance. London, Gee.
Combined Code. 2003. The combined code on Corporate Governance. London, Financial Reporting Council.
Directors' Remuneration Report Regulations. 2002. Available at http://www.opsi.gov.uk
Girma, S., Thompson, S. And Wright, P.W. 2007. Corporate governance reforms and executive compensation determination: evidence from the UK, the Manchester School, vol. 75(1): pp. 65-81.
Performance Management Process and the CEO
Critique and evaluate considerations that are traditionally used to determine CEO compensation
Many reward compensations adopted by the CEOs of this era contain five primary components: limited stock grants, limited option grants, payouts for incentive plans, annual bonuses, and salary. While the amounts of bonuses, compensation and perquisites found in not-for-profit sectors may pale in comparison to those in the for-profit world, they generate combined reactions. Their existence can ignite debate, especially in periods of shrinking budgets and increasing costs. However, the ability to hire, maintain, and compensate CEOs is essential in all sectors, and is mostly achieved using a variety of executive compensation plans. The issues around the design of these systems in both the business and not-for-profit areas are similar (Bhattacharyya, 2011).
The last two decades have witnessed a drastic transformation of the executive compensation in many organizations. Compensation of top executives…
Bhattacharyya, D.K. (2011). Performance management systems and strategies. Dehli: Pearson.
Bebchuk, L.A., & Fried, J.M. (2004). Pay without performance: The unfulfilled promise of executive compensation. Cambridge, MA: Harvard University Press.
Blazey, M.L. (2013). Insights to performance excellence, 2013-2014: Understanding the integrated management system and the Baldridge criteria. Milwaukee: Asq Quality Press.
Chingos, P.T. (2004). Responsible Executive Compensation for a New Era of Accountability. Hoboken: John Wiley & Sons.
List and explain the five different stakeholders of a company's compensation system
Both federal and state governments have their own regulations, laws and directives that have an influence on compensation schedules. For instance, the federal government has set minimum wage levels and also has legislation on payroll issues. The federal government also has a lot of influence on economic matters. Governments also draft policies that can help them to increase the ease of doing business. While many governments have free-market and non-interference policies, they also have set rules and regulations, with regards to the treatment of workers, occupational safety, social security contributions and hiring practices (Fred-Adegbulugbe, 2010).
Executives / Managers/Owners or Founders
Company executives and managers ought to actively know the link between their employees and their performance, and reward and budget management. The main objective of compensation systems is to enhance employee productivity so as to…
Fred-Adegbulugbe, C. (2010). Minimum wage: Law to compel payment by states, firms underway. Punch Newspaper (July 12):1.
Lazear, E. (2000). Performance Pay and Productivity. American Economic Review. 90(5). pp. 1346-1361.
Markel, K. S. (2010). Discretionary Employee Benefits, Society for Human Resource Management.
Martocchio, J. J. (2008). Employee benefits: A primer for human resource professionals, 3rd ed. New York: McGraw-Hill Higher Education.
iordan Manufacturing: Internal and External Compensation
iordan Manufacturing: External and Internal Equity Compensation
iordan Manufacturers, being a leader in its industry, appreciates the need to meet the needs of its employees through a fair compensation policy - one that equates pay with the value of the task performed, because fair treatment boosts employee performance and morale, and is an effective employee retention technique (omanoff, Boehm & Benson, n.d.). Internal equity compensation describes an employee's compensation in relation to that of other employees at the same level within iordan Manufacturing (H Council, 2014). External equity, on the other hand, compares iordan Manufacturing's wages with those of organizations within the industry.
Employee compensation is fundamental to iordan Manufacturing, just as is stipulated in the company's compensation philosophy. iordan realizes the intensity of global competition and understands that in order to maintain its industry position and market share, it has to acquire the…
HR Council. (2014). Compensation and Benefits. HR Council. Retrieved 2 May 2014 from http://hrcouncil.ca/hr-toolkit/compensation-systems.cfm
Romanoff, K., Boehm, K., & Benson, E. (n.d.). Pay Equity: Internal and External Considerations. Pay Equity Article. Retrieved http://theperfectpayplan.typepad.com/Pay_Equity_Article.pdf
WHERE CREDIT IS DUE
Methods to Determine Incentive Pay
The first method is to align the objectives of the incentive pay with the organization's business strategy (Gordon & Kaswin, 2010). The second method is to test the pay plan with a small group of employees to discover its defects or problems and to solve these. When these are accomplished and the plan seems appropriate, it should be implemented throughout the organization and regularly enforced (Gordon & Kaswin).
While incentive plans are major attractions to job applicants, businesses have shifted their focus on the risks, which may go along with incentive compensation agreements (De Toro & Pohle, 2011). These are a major concern to the company that cannot be overlooked. These embedded risks may be hard to detect and manage so that the company should adapt measures, which would align incentive pay with the company's goals, strategies and the…
De Toro, K. And Pohle, N. (2011). Managing risks in incentive compensation plans.
SHRM: Society for Human Resource Management. Retrieved on March 11, 2015 from http://www.shrm.org/hrdisciplines/compensation/articles/pages/incentiverisks.aspx
Gordon, A.A. And Kaswin J.L. (2010). Effective employee incentive plans: features and implementation processes. Cornell HR Review: Cornell University. Retrieved on March 16, 2015 from http://www.digitalcommons.ilr.cornell.edu/cgi/viewconent.cgi?article=1011&content=chrr
Grant, R.W. And Sugarman, J. (2004). Ethics in human subjects research: do incentives matter?
Nike Inc. is an America multinational company with engagements in development, manufacturing, design, and global marketing of equipment, apparel, footwear, services, and accessories. The firm has its headquarters in Beaverton in Portland metropolitan region. The company remains part of the largest apparel and athletic shoes supplier in the world. The company is a notable manufacturer of different sports equipment reaching a revenue mark of U.S.$23.1 billion in 2012. The year 2012 was illustrated by the employment of close to 44,000 individuals across the world. Further, the brand was estimated to be at the value of $19 billion that made it a valuable brand within other sports businesses. Nike was developed in 1964 under the name Blue ibbon Sports (Farrell, 2009).
The founders were Phil Knight and Bill Bowerman who later adopted the name Nike, Inc. In 1971. The firm took the name against the Greek meaning of 'goddess of victory'.…
Berger, L., & Berger D., (2008). The compensation handbook. New Jersey: McGraw-Hill Professional.
Biswas, B.D. (2012). Compensation and Benefit Design: Applying Finance and Accounting Principles to Global Human Resource Management Systems. New York: FT Press.
Estreicher, S., & Reilly, D.J. (2010). Employee Benefits and Executive Compensation: Proceedings of the New York University 59th Annual Conference on Labor. New York: Kluwer Law International.
Farrell, B.S. (2009). Human Capital: Actions Needed to Better Track and Provide Timely and Accurate Compensation and Medical Benefits to Deployed Federal Civilians. New York: DIANE Publishing.
Verizon Compensation Strategy
Verizon Communications is a publicly traded company registered in the United States as a telecommunications and broadband company. It trades under the name Verizon. It is a market leader in the telecommunications industry and strives to provide excellent services that satisfy consumers. Worker compensation has always been an important aspect of Verizon's overall strategy to keep employees motivated and provide excellent service to consumers. In 2010, the company did a review of their compensation strategy with the aim of improving it. The 2010 compensation decisions, designed by a committee and approved by shareholders, took effect in 2011.
Briefly describe the company you researched, its compensation strategy, best practices they are applying, and compensation-related challenges they are facing.
Verizon's compensation strategy is founded on providing fair compensation to its employees. All of Verizon's employees get a base salary that is pegged on market rates and incentives…
Cheng, Q., & Farber, D.B. (2008). Earnings Restatements, Changes in CEO Compensation, and Firm Performance. The Accounting Review, 83(5), 1217-1250. doi: 10.2307/30243544
Tosi, H.L., & Greckhamer, T. (2004). Culture and CEO Compensation. Organization Science, 15(6), 657-670. doi: 10.2307/30034768
Williams, M.L., McDaniel, M.A., & Ford, L.R. (2007). Understanding Multiple Dimensions of Compensation Satisfaction. Journal of Business and Psychology, 21(3), 429-459. doi: 10.2307/30221746
New Trends in Employee Compensation and Benefits
This essay examines new trends in compensation and benefits. The essay discusses the impact of benefits offerings for both employer and employee, and reviews recent trends and discusses their significance.
Reasons for working vary from individual to individual, and compensation is usually among the most important reasons. However, many people list other factors that are almost equally important to them. These factors can range from opportunities to develop new skills, to an experiencing a sense of community, to more tangible benefits such as provisions for retirement. Currently benefits programs account for approximately one third of the average worker's total compensation, based on the size, profitability and philosophy of a particular employer. Programs that are effectively designed and promoted work to the advantage of both employers and employees (ish).
Compensation packages have changed significantly over the years. They no longer consist of a flat…
Gioia-Herman, Joyce. (2011). Trends in Employee Benefits. Engine Builder Magazine. Web. 3 March 2012.
Society for Human Resource Management. (2011). 2011 Employee Benefits Research Report. Web. 3 March 2012.
Wish, Fred. (2012). Trends in Employee Benefits -- Beyond the Fringe, Benefits Plans for Today's Workforce. Web. 3 March 2012. .
Zoo Media Group. (2012). New Trends in Employee Compensation. Web. 3 March 2012.
Dental care under MCSS fee schedule for Ontario Works adults;
Prosthetic appliances such as back braces, surgical stockings, and artificial limbs (provision, replacement, and repairs);
Wheelchairs and repairs for the portion not covered through ADP;
Hearing aids and batteries (co-payment under Ministry of Health and Long- Term Care's Assistive Devices Program (ADP) for the provision, replacement, and repairs to hearing aids);
Vision care for adults;
Dentures where deemed appropriate;
Cost of completing other medical forms; and Other items may be approved individually based on medical documentation stating the need and the benefits.
7. It is important to carefully define these factors and determine an appropriate number for the organization. The definitions should not overlap, resulting in the same job dimension being measured multiple times. However, the important aspects of each job and what the organization wants from its employees must be included. From there, home country-based compensation is the following…
Caywood, Steven C. (2010). Wasting the Corporate Waste Doctrine: How the Doctrine Can
Provide a Viable Solution in Controlling Excessive Executive Compensation. ichigan Law Review, 109(1), 111-136.
ajor Thesis: This article reviews and seeks a solution for the controversial issue of corporate executives receiving enormous compensation. The article points out that public outcry against grossly, outrageously inflated bonuses and other compensations for executives has rarely done any good, but the group that suffers the most when executives receive such huge compensation are the shareholders. eantime this paper suggests that the "corporate waste doctrine" is one way to limit "excessive executive compensation"; if the corporate waste doctrine were enforced legislatively, the author explains, and executives continue to be paid outlandishly huge bonuses, the stakeholders would have a legal recourse in response.
Clearly it is unfair when an executive -- specifically a CEO -- receives "…roughly 400 times that of an…
Moreover, how could this article and the knowledge of corporate waste doctrine be of benefit to me in the future? If I were in the position of a shareholder in a corporation -- all I would have to do to become a shareholder is buy shares in any given company -- and executives in the corporation were given grossly over-the-top salaries, I would organize other shareholders and together we stakeholders would retain a competent attorney and plan to use the corporate waste doctrine.
Is there a precedent for bringing corporate waste to the point of litigation? There are a number of cases that have failed. But in the first big case, in which the Supreme Court recognized the corporate waste doctrine was in 1933 (Rogers v. Hill). Shareholders rebelled against the American Tobacco Company for paying what they believed to be excessive compensation; the High Court held that corporate waste occurs "…if a bonus payment has no relation to the value of services for which it is given" but the hard part for plaintiffs is proving corporate waste (Caywood, 117).
Conclusion: Before launching litigation as a shareholder holding stocks in a corporation, this article has shown me that in order to make a case for corporate waste, every previous case that has been brought by shareholders against boards of directors -- contesting absurdly high compensation -- must be carefully reviewed. What mistakes were made? What can be learned? Did the litigants make erroneous assumptions? What is the most recent ruling by courts at any level of the judiciary? How many shareholders can I get to back up my assertions, when a top executive walks away with a $22 million bonus, and we shareholders actually took a loss in this fiscal year? These are things I learned from this article and that I can apply in the future, because I do plan to become a shareholder in a successful corporation.
Fun is Good
The Benefits of Google Inc.
The benefits and compensation system for Google Inc. is both varied and complex. It offers many options for the worker at Google Inc. And is meant to increase employee retention rates within the company. Compensation and benefits systems enable leaders to generate and maintain a chance for an effective mechanism that stimulates a culture of self-empowerment, creative modernization, and self-motivating employees. Google is among the top companies in promoting self-motivation and innovation within its employee pool leading to its continual success and high profits.
Google Inc. has become one of the top 100 companies in the world with profits increasing since its formation in 1998 and its first public offering in 2004. Ever since the mid-2000's, Google has received a steady wave of success. "Companies like Cisco Inc. And Google Inc. have structured their leadership to provide the best environment to motivate…
Bershidsky, Leonid. "Why Are Google Employees So Disloyal?" Bloomberg. Bloomberg, 29 July 2013. Web. 22 Feb. 2014. .
Cook, Joshua. "How Google Motivates their Employees with Rewards and Perks." HubPages. Thinkingleaders.com, n.d. Web. 22 Feb. 2014. .
Datamonitor.com. "Datamonitor Research Store - Google Inc." Datamonitor | the home of Business Information. N.p., 2014. Web. 21 Feb. 2014. .
Glassdoor. "Google Salaries and Benefits." Glassdoor. N.p., n.d. Web. 22 Feb. 2014. .
Total Compenstion Statement Memo
Human resource (H) policies and decisions play a crucial role in an organization. They serve as a driver of employee productivity as they directly or indirectly affect employee engagement, job commitment, employee satisfaction, and employee retention. An important H function relates to compensation, which is basically concerned with determining the amount of remuneration and benefits employees get as a result of their input to the organization. Sufficient compensation is crucial for attracting and retaining the right people for the job (Stredwick, 2014). The position of an administrative assistant is without a doubt an important position, underscoring the need for competitive and attractive compensation. As per the U.S. Bureau of Labor Statistics (BLS), an administrative assistant earns an average income of $55,460 per year or $26.66 per hour (BLS, 2017). More specifically, an administrative assistant in the category of "Management of Companies and Enterprises" earns an average…
Bureau of Labor Statistics (BLS) (2017). Executive secretaries and executive administrative assistants. Retrieved from: https://www.bls.gov/oes/current/oes436011.htm
Mello, J. (2015). Strategic human resource management. 4th edition. Mason: Cengage Learning.
Stredwick, J. (2014). An Introduction to Human Resource Management. London: Routledge.
Crafting a Compensation and Benefits Plan: Looking Ahead in the Modern Workplace
Increasingly, technologically-driven businesses have become more and more reliant upon attracting top talent to gain a competitive edge. Perhaps the most obvious example of this is the Google organization. Google’s Internet search engine is virtually synonymous with searching on the Internet itself. Google offers generous salaries and time off to its employees. It also offers many amenities, such as free food, medical care, dry-cleaning, fitness classes, and even buses from certain common location hubs in the surrounding area. This enable employees to remain focused on work as well as removes many of the inconveniences of modern life (Cain, 2017). To reduce stress levels about balancing personal and professional lives, Google even offers the option of allowing employees to bring pets to work and daycare (Cain, 2017).
Amazon has been taking the lead from Google, also offering catered lunches,…
psychiatrist, Viktor Frankl, while suffering numerous hardships in his life as a prisoner of war in a Nazi work camp that included being isolated from the rest of the world including his family along with the prospect of facing at the hands of his captors death every day began to question the meaning of his own existence and the meaning of life in general. Frankl eventually came to the conclusion that people derive meaning from their lives as either as result of their suffering, their ability to love another, and their work (Frankl, 1985). A person's work helps them to define a sense of themselves, contributes to their feeling that they are useful, and helps to keep them active (Frankl, 1985; Shacklock, 2006; Waddell & Burton, 2006). These benefits occur at any age; therefore, by continuing to remain in the workforce elderly people can both produce benefits to their community…
Australian Bureau of Statistics. (2006). Retirement and retirement intentions. Canberra: Author.
Beier, M.E., & Kanfer, R. (2013). Work performance and the older worker. Sage Handbook on Aging, Work, and Society, 16, 65-97.
Center for Disease Control. (2012). Older employees in the workplace. In National Center for chronic disease prevention and health promotion. Retrieved September 25, 2014, from http://www.cdc.gov/nationalhealthyworksite/docs/issue_brief_no_1_older_employees_in_the_workplace_7-12-2012_final508.pdf .
Cummings, T., & Worley, C. (2014). Organization development and change. Stanford, CT:
Savannah Engineering, Inspection and Insurance Company (SEIIC):
Trends in compensation and benefits
Savannah Engineering, Inspection and Insurance Company (SEIIC) is a service-based company and thus must cultivate a strong and committed performance from each and every one of its employees to thrive. However, currently its compensation and benefits programs lacks the ability to reward top performers and merely gives annual pay increases to all employees of 2-5%, regardless of the employee's level of productivity. Seniority rather than performance is given preference in terms of the company's evaluation and rewards system. Its benefits are competitive given that it offers health insurance and other benefits but the structure of the benefits is rigid and only includes such traditional benefits as health insurance, life insurance, retirement plan (defined benefit) and a 401(k) plan (defined contribution). This paper will offer suggestions to improve evaluation and rewards systems to ensure that top earners are adequately…
Buckingham, M. (2011). The fatal flaw with 360 degree surveys. Harvard Business Review.
Retrieved from: https://hbr.org/2011/10/the-fatal-flaw-with-360-survey
D'Onfro, J. & Smith, K. (2014). Google employees reveal their favorite perks about working for the company. Business Insider. Retrieved from: http://www.businessinsider.com/google-employees-favorite-perks-2014-7
Dyer, J. (2013). Does Management By Objectives Stifle Excellence? Industry Week.
Utley Food Case Study
Utley Food Markets was founded in the 1930s in the St. Louis area. It grew to 86 supermarkets in the Missouri and Southern Illinois area. Up until 1948 it was a family owned company, but then sold and went public, with the Utleys moving out of managerial roles. The company is now heavily unionized, and even those employees who are not union members receiving similar salary increases as to union members. One of the largest concerns is the manner in which employees are reviewed; now typically with the supervisor answering, "how did this employee do in the past year." There is no quantitative data, dialog, supervisory committee, or employee response. This has resulted in a culture of mistrust and suspicion, with the general view that the system is unfair. hen employees complain, supervisors typically respond with a larger than average raise simply to make the concern…
Challenges of Performance Appraisal. (2007, March). Retrieved from Appraisals.Naukrihub.com: http://appraisals.naukrihub.com/challenges.html
The Strategic Planning Process. (2010, March). Retrieved from QuicMBA.com: http://www.quickmba.com/strategy/strategic-planning/
Beer, M. (2011, March). Pay for Performance Doesn't Always Pay off. Retrieved from Harvard Business School: http://hbswk.hbs.edu/item/3424.html
Kole, M. (2010, January 8). Trying to Understand the Union Mentality. Retrieved from Kole Hard Facts of Life: Retrieved from: http://kolehardfacts.blogspot.com/2010/01/trying-to-understand-union-mentality.html
Scenario Background -- Jack Parks is the benefit manager for a division of USA Motors. He is concerned about the level of absenteeism and the "paid absence" agreement negotiated a decade ago. The theory was that by giving workers a full week of paid absence against which they could charge personal absence, they would be encouraged to plan ahead and let supervisors know when they might be gone so that staffing could remain consistent. In reality, workers discovered that by not charging off any paid absence days they could receive a full week's pay in June when the company paid unused benefit hours. Workers had, in fact, come to think of it as a bonus that coincided with summer vacations when USA shut down for inventory in the summer. Parks believes that he can control this abuse of a benefit by a series of percentile deductions on future…
Absenteeism Control Programs. (2005). Performance Development International. Retrieved from: http://www.pdii.net/hrservices_Absenteeism.aspx
Kole, M. (January 8, 2010). Trying to Understand Union Mentality. Kole Hard Facts of Life. Retrieved from: http://kolehardfacts.blogspot.com/2010/01/trying-to-understand-union-mentality.html
McClenney, M. (1992). A Study of the Relationship Between Absenteeism and Job Satisfaction. Applied Research Projects, Texas State University, 241. Retrieved from: http://ecommons.txstate.edu/arp/241/
Treble, J. And Barmby, T. (2011). Worker Absenteeism and Sick Pay. Cambridge: Cambridge University Press.
Compensation Purpose & Strategy
Each different compensation strategy comes with risks and benefits, and the company has to balance these. We do not know where Chatham sits in terms of strategy, or in terms of its compensation policy. To determine the optimal compensation policy, and understanding of the implications of each policy is necessary.
If the company lags in terms of compensation, it will struggle to attract candidates. The most qualified candidates will go elsewhere, and there is likely to be high turnover as well. The starting candidates will be weaker, and ultimately the company's productivity will suffer. There are few benefits to paying below market, because lower productivity offsets lower wages. If you pay the market, then the company has to differentiate itself in other ways to attract people. This is possible, and can be a cost-effective means of attracting and retaining good people. Paying above market, especially leading…
Csizmar, C. (2010). To lag, lead or lead-lag: Examining the question in the real world. Compensation Cafe. Retrieved February 20, 2017 from http://www.compensationcafe.com/2010/10/to-lag-or-lead-or-lead-lag.html
Sturman, M. & McCabe, D. (2006). Choosing whether to lead, lag or match the market. The Scholarly Commons. Retrieved February 19, 2017 from http://scholarship.sha.cornell.edu/cgi/viewcontent.cgi?article=1338&context=articles
Vending Machine Businsess Plan
Maketing business plan
Location, envionment and taget maket
Value poposition and competitive edge
Maketing and sales stategy
Online maketing technique
H.U.M.A.N. Healthy Vending -- Healthy Seven Vending
Location, envionment and taget maket
Ameica's obesity epidemic has been spialing out of contol in the past two decades, and will continue to gow unless dastic measues ae taken to change Ameican eating habits. It is of paticula concen that the ate of childhood and adolescent obesity is gowing so apidly. H.U.M.A.N. Healthy Vending (Healthy Seven Vending) believes that it is essential that food copoations pai with local municipalities, educational institutions, and othe oganizations that play a vital ole in young people's lives. "Moe than half of U.S. middle and high schools still offe suga dinks and less healthy foods fo puchase. Students have access to suga dinks and less healthy foods at school thoughout the…
references even when they are not eating from vending machines.
A growing problem. (2013). Overweight and obesity. Centers for Disease Control. (CDC).
Not even public health experts entirely agree why the obesity rate has skyrocketed in recent decades. This website provides an overview of some of the leading proposed causes, including the popularity of marketing junk food to teens.
H.U.M.A.N. Healthy vending machines. (2013). http://www.healthyvending.com/machines
Company's Compensation And Benefit Package
A number of factors determine how a company compensates its employees. These factors may include economics, psychology and even sociology. To an economist compensation is viewed as a labor market determinant (Filer, Hammermesh, & ees, 1996). As a human resource manager for Vanguard Industries I have been entrusted with the responsibility of explaining to the Chief Executive Officer (CEO) that guided my development of the company's compensation and benefit plan. I will specify economic factors I considered while coming up with the company's compensation and benefit packages, the manner in which they do so and the relative and absolute importance of each. Before coming up with a compensation and benefit scheme, it is imperative that matters pertaining employees' skill level, age, gender and minority and majority status are factored as they affect an individual's reward preferences and their view on what they contribute to an…
Filer, R., Hammermesh, D., & Rees, A. (1996). The Economics of Work and Pay 6th ED., New
York: Harper Collins.
Landes, W.M. (1968). The Economics of Fair Employment Laws. Journal of Political
Economy, 76: 507-52.
Total Compensation Methods
Compensation is widely considered as a primary source of motivation for the employees within an organization.in most scenarios people look for jobs which not only suite their creativity and talents but those which compensate them in terms of salary and benefits. Compensation is one of the fastest changing fields when it comes to Human esource as companies are going ahead with investigations of various ways that can be used for rewarding employees commensurate to their performance. Within any organization there is need to ensuring that the turnover ratio is well maintained while at the same time retaining the best employees. Compensation and benefits are two sure ways that a company can use to achieve such things. This paper therefore looks at some of the common compensation strategies that are found within organizations, analyses the impact of various compensation methods used and also highlight how the salaries and…
Abel, M.(2012).Salary & Benefit Administration strategies to organizational culture and performance. Retrieved February 4, 2014 from http://www.ehow.com/info_8557824_salary-strategies-organizational-culture-performance.html
Payscale. Inc.(2009.). The Impact of Compensation Methods and Decisions. Retrieved February 4, 2014 from http://www.payscale.com/compensation-today/2009/10/impact-of-compensation-methods-on-employees-and-organizations
Answers Corporation, (2014).Employee compensation. Retrieved February 4,2014 from http://www.answers.com/topic/employee-compensation
Total ewards: Compensation That Encourages
Developing a more comprehensive and conscious reward system can be an excellent way to motivate employees, to maintain and exceed ethical human resources management practices, and to attract and retain top talent through performance-based compensation. There are also several legal considerations that need to be taken into account before implementing such a system, however; though it might seem odd that trying to give employees more could have legal barriers, understanding the law helps owners to avoid unintentional errors that could create significant risks for the business. The following pages present a brief overview of some of the total rewards considerations that should be looked into and some of the attendant legal concerns that could arise.
Achieving Total ewards
No rewards system will be effective if the goals that lead to rewards are not clearly defined and carefully adhered to, but part of the beauty of…
Armstrong, M. & Baron, A. (2002). Strategic HRM. London: CIPD.
Mathis, R. & Jackson, J. (2011). Human Resource Management. Mason, OH: Cengage.
Thompson, P. (2002). Total Rewards. London: CIPD.
Compensation strategy is a useful tool that many, if not all, human resources managers can and should use in order to maximize their efficiency and effectiveness within the scope of a larger institution. Compensation strategy allows for the principles and character of the organization to show and demonstrates ability to negotiate the challenging aspects of maintaining a competitive advantage within a given industry.
The purpose of this essay is to explain and highlight the importance of strategic compensation as a component of a the larger corporate strategy within an organization. This essay will examine how pay and different forms of pay can be instrumental in finding new ways to motivate, sustain and increase participatory levels within company organizations and provide a footwork for future successes. This essay will also discuss some of the approaches that may be deemed useful by human resources managers in creating and designing a…
Greene, R. (2010). Effectively Managing Base Pay: Strategies for Success. Society for Human Resource Management, 21 Jan 2010. Retrieved from http://www.shrm.org/hrdisciplines/compensation/Articles/Pages/CMS_005592.aspx
Milkovich, G. & Broderick, R. (1989). Developing a Compensation Strategy. Cornell ILR School 1 Dec 1989. Retrieved from http://digitalcommons.ilr.cornell.edu/cgi/viewcontent.cgi?article=1416&context=cahrswp
Schuster, J. & Zingheim, P. (2012). Compensation and Human Resource Practices During Crisis. World at Work Journal, 1st quarter 2012. Retrieved from http://www.worldatwork.org/waw/adimLink?id=59577
Qualified Benefit Plans
Why company set qualify benefit plans tax benefits company employees maintaining qualify plans. Also, company comply benefit laws regulations order maintain qualify status plan.
Employers sometimes offer their employees and other beneficiaries within the organization retirement plans which they sponsor. These are often referred to as qualified plans. These qualified plans are either established as defined benefit plans or defined contribution plans. When established as defined benefit plans, the employee receives benefits on a formula that factors in personal factors such as the employee's salary history and the duration of contract or employment. In these plans, the risk of investment and management of the portfolio is run by the employer. In these schemes, the employer sometimes has to find funds from alternative sources such as the company's profits in order to fund employee's retirement when there is a shortfall in funding. The other type of qualified plans…
Brown, J.R., Mitchell, O.S., Poterba, J.M., & Warshawsky, M.J. (1999). Taxing Retirement Income: Nonqualified Annuities and Distributions from Qualified Accounts. National Tax Journal, 52(3), 563-591. doi: 10.2307/41789742
Huberman, G., & Jiang, W. (2006). Offering vs. Choice in 401(k) Plans: Equity Exposure and Number of Funds. The Journal of Finance, 61(2), 763-801. doi: 10.2307/3699357
Lipman, J.H. (1983). Valuing Defined Contribution Plans. Family Advocate, 5(4), 19-21. doi: 10.2307/25806070
Lisa Meulbroek. (2005). Company Stock in Pension Plans: How Costly Is It? Journal of Law and Economics, 48(2), 443-474. doi: 10.1086/430807
Stryker Organizational Strategic Plan
Stryker is a world leader in medical technology and works to make healthcare much better. Stryker offers innovative medical devices and technologies reported to include "reconstructive, medical and surgical, and neurotechnology and spine products to help people lead more active and more satisfying lives. Stryker products and services are available in over 100 countries." (Stryker.com, 2014, p. 1) Stryker reports having spent $471 million on research and development during 2012 and 5 to 6.3% of its sales invested each year since 2000 are in research and development having assisted 4,768 patients on a global basis in 2012. Stryker has been recognized by Fortune 500 and is a Gallup Great Workplace Award Winner as well as being recognized by Fortune Magazine as one of the top 100 that are best to work for. While Stryker is a successful company it has recently reported a problem with an…
Customer Care (2014) Stryker. Retrieved from: http://neptunecustomercare.com/new-home/?reg=usa
Stryker Surgical (2014) Retrieved from: http://www.stryker.com/en-us/Divisions/Surgical/index.htm
Urgent Medical Device Recall Information (2013) Stryker. 20 Feb 2013. Retrieved from: http://www.stryker.com/stellent/groups/public/documents/adacct/148290.pdf
Staff Development Plan
Staff development is central to the quality performance of activities in any organization. In order for an institution to achieve its goals and objectives, a clear staff development plan is necessary in order to set priorities and initiate a common spirit of all the staff members. This study examines the necessity of a key staff development plan in an envision higher learning institution. The study explores the importance of staff development to the quality of higher education. Currently, many higher learning institutions do not consider the necessity of proper staffing and development as a key to quality performance. Instead, these institutions fail to achieve their goals or objectives, and consequently low quality of higher education.
Higher education institutions highly depend on people to deliver their missions and objectives. In this regard, the quality of staff and the motivation they receive from the institution's management highly influences their…
World Bank. (1994). Higher Education: The Lessons of Experience. Washington DC
Blackwell, R. (2003). Towards Strategic Staff Development in Higher Education. Berkshire:
Mukherjee, H. & Jasbir, S. (1993). Staff Development Approaches in Higher Education:
Learning from Experience. London: Common Wealth Secretariat.