Compensation and Benefits Plan Executive Summary
Due to shrinking local labor market and increasing turnover within SMC Company, the board members of SMC will propose a comprehensive and progressive compensation and benefits plan to the CEO to increase retention in the Company. Traditionally SMC has paid only minimum wage and mandatory benefits. The following paper will propose the costs of the plan, external and internal equity, and creative methods of compensation and voluntary benefits for SMC.
Cost Of Plan
In order to address the issues of retention at SMC, we must first look at cost: are we spending too much, or are we not spending enough in addressing the compensation and benefits needs of our employees. We plan to look at the following areas to see how cost will affect our bottom line in profits; current benefits plan vs. optimal benefits package, incentive programs such as bonuses and profit sharing, and last implementation of routine job evaluations to reflect current trends in compensation factors, ranking, and pay grades.
Our HR department will be responsible for providing the initial data to support our claim, that we are not doing enough retain our employees, thereby we have incurred a high turnover rate. SMC believes the market, overall profit of the company, and employee motivation will drive the cost of change in these areas. Trade-off in these areas of corporate improvement will payoff in overall employee satisfaction, which will lead to higher profits.
External and Internal Equity
As a growing organization in office supply business, SMC is experiencing a high turn over rate. SMC recognizes it is necessary to retain and motivate a sufficient number of our qualified employees. This requires a base pay program that pays competitively by at least three percent or higher than our competitors.
SMC will also...