COMPENSATION AND BENEFITS

Compensation and Benefits



Compensation and benefits plans

Outline new compensation plans specifically for American Widget

Consideration of the company's compensation system, it is done in terms of cost / benefit that is, when setting a fee or providing an incentive, expected result of their investment. Incentive means a stimulus located outside the body that is associated, with one or more intra-organic factors, to produce a given activity. Extra-organic stimulus is also used to manage or maintain a motivated behavior. There are objectives and criteria for a benefit program. The objectives relate to the expectations of short and long term organization with regard to program outcomes. The criteria are factors that weigh in relative weighting of the program (Boden, 2005).

The objective for the compensation and benefit plan is the reduction of turnover and absenteeism, raising the moral and strengthening security. New compensation plan comprises higher basic wages, gain sharing or bonus, employee old age benefit and other allowances such as medical reimbursement. The indirect or non-monetary compensation plan would include Flexible working hours schedule; paid leaves, vacations, and sick leaves; meals and free; transport facility; cell phone, car and other perks and insurance (Boden, 2005).

Why pay system will work

Payment for labor, being due to the nature of social production, determines the legal mechanism for distributing the product of labor between the employee and the employer. This distribution is characterized by the following points. First, part of the product is distributed in accordance with the magnitude of work cast by an employee in the manufacturing process. This provides an incentive of workers in the complete, intense and productive use of their time. Second, labor is paid higher qualifications higher than for the same cost unskilled labor time, that interest the workers in professional development, academic level and professional skill. Third, work in difficult and hazardous conditions, the material is encouraged in higher amounts than in normal difficulty (normal) conditions. It provides business compensation for supplemental labor costs (Corby, 2005).

The first is a cash payment, which is intended to reimburse costs incurred in the performance of their employees and other labor-related employment, duties. The payments provided for in Article 164 of the Labor Code and intended as precisely offset expenses. Therefore, they are in the system of remuneration are not included and are not subject to UST. Wage consists of two parts. First is the remuneration and payment of compensation and incentive-based. In this case, compensation payments those do not compensate for specific costs of the employee, and are part of wages. That is, employees receive them for a certain kind of work as compensation for the difficulty or difference from generally established standards. These payments, in effect, and are also payments to employees as part of wages and should be included in the tax base for the UST (Corby, 2005).

Components of a benefits system that would give incentives

The new compensation plan will include two types of rewards: Monetary compensation and non-monetary benefits. The direct or monetary compensation will include:

Higher Basic Wages: The employees ...