Compensation Methods Ã¯Â¿Â½ PAGE Ã¯Â¿Â½1Ã¯Â¿Â½
Total Compensation Methods Paper
Human resources assist in the development of key components to various compensation packages with the intention of attracting the best candidates, increasing morale and decreasing employee turnover. When it comes to compensation methods, a company has many options. Compensation not only has an effect on the company, but in addition the employee and potential future employees. Compensation packages may be an additional benefit to the employees offered by a company, or a requirement by law. This paper will look at both types of compensation, and supply an evaluation of the effect of assorted compensation methods, concluding with how salary and benefit administration relate to culture and performance within an organization.
Compensation methods and benefit programs are major elements of the human resource decision-making process. Not all compensation is monetary, thus enhancing employee incentives and contributing to the overall needs of the labor market (Noe, et al, 2006).
Compensation and benefits are strategically designed to compete in the job market and attract qualified employees who will contribute significantly to the goals and objectives of an organization (Noe, et al., 2006). Compensation and benefit packages determine which individuals will seek employment with certain employers, and how much an employer values the skills
and efforts of its workforce. Every organization has a different package, tailored to meet the needs of the company (Noe, et al., 2006). Various packages are composed of benefits required by law and optional benefits willfully selected by employers.
The benefits required by law include, social security, unemployment insurance, workers' compensation insurance, and family and medical leave (FMLA). Such benefits are intended to support and protect employees who are retired, laid-off, injured on the job, or responsible for the medical needs of a family member. Smaller businesses tend to avoid...