Compensation refers to the payment made to an employee in return for the job he or she does for the organization. The commonly known forms of compensation include salaries, wages, and tips (Carraher, 2011). Payment is normally provided as either variable pay or base pay. Variable pay is the one which is based on the performance of the employee on the roles given while base pay does not depend on the return (Chiu et al., 2002). Some jobs have both base and variable pay. A benefit, on the other hand, refers to the optional compensation made to employees besides the usual salaries or the wages (Hofmann, 2015). These may include retirement benefits, insurance on health, vision, dental or even life, sick leave vacation amongst others.
In this case, I focus on an individual employed as a manager in a family organization. This type of an organization embraces the idea that success is achievable through teamwork, individual development as well as shared values and norms.
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Annual Salary
The employee is classified as nonexempt and, therefore, entitled to the overtime pay. The yearly salary of the manager would earn an average annual salary of $100000. The annual wage of the employee will increase based on higher promotions.
Benefits Plans
Benefits enable the employees to attain peace of mind which subsequently leads to increased productivity since they are assured that their fears are protected (Hameed et al., 2014) Employees with disabilities can enjoy protection which includes replacement in case of disability and serious illness. The employee should also have a sense of pride in his or her job and as a result, work better.
Health and dental benefit
Hospital charges for emergency treatment outside the country.
Medication, vaccines and drugs accessible by prescription.
The charges of hospital room will exceed the standard rate to cover private or semi-private accommodation.
Non-emergency ambulance services.
Dental treatment that does not require hospitalization.
Professional services provided by specialized medics such as psychologists, podiatrists, chiropractors naturopaths as well as osteopaths.
Expenses for vision care include contact lenses, frames, fitting and remedial treatment eye surgery.
Options for extended healthcare plans should be selected on the basis of the organization compensation objectives as well as the needs of employees.
Dental
The dental plan is designed to find an elusive balance between foundational priorities and allocation of funds to make sure that the program is necessary and suitable. Depending on the dental problem, the employee requires an evaluation of pre-treatment for certain expenses that help in controlling the cost levels by ensuring the program only caters for reasonable treatments (Milkovich, 1999). The dental plan is optional for the employees, and so only the employees with a dental problem are expected to sign up.
House Allowance
Decent housing enables employees to have peace of mind and thus increase their productivity and working capacity. The employee will be entitled to a house allowance of $ 10000 per month.
Transport Allowances
Transport allowance enables the employees to be timely and to ensure that they travel safely to their place of work. With transport allowance, an employee would not have any excuse for not getting to work early enough. The employee would be entitled to a transport allowance of $100 per month.
Retirement Savings
The retirement savings are significant in the future lives of the employees. Through the savings, an employee gets to the opportunity to relate more to the employer. Every employee is designated to increase 4% of their total earning depending on his or her salary.
Raises, Bonuses and Incentives
The employee's right performance would attract bonus and other incentives to his or her family. Based on the performance rating, the employee would receive annual raises. For instance, an outstanding appraisal may lead into 4% salary increase. There are also cash incentives based on the available funds that are meant for distribution of employees whose performances stand out and contribute to the success of the business.
References
Carraher, S. M. (2011). Turnover prediction using attitudes towards benefits, pay, and pay satisfaction among employees and entrepreneurs in Estonia, Latvia, and Lithuania. Baltic Journal of Management , 6 (1), 25-52.
Chiu, R. K., Wai-Mei Luk, V., & Li-Ping Tang, T. (2002). Retaining and motivating employees: Compensation preferences in Hong Kong and China. Personnel Review , 31 (4), 402-431.
Hameed, A., Ramzan, M., & Zubair, H. M. K. (2014). Impact of compensation on employee performance (empirical evidence from banking sector of Pakistan). International Journal of Business and Social Science , 5 (2).
Hofmann, A. (2015). Compensation and Benefits: Essentials of Base Salary. Handbook of Human Resources Management , 1-15.
Milkovich, G. T., Newman, J. M., & Milkovich, C. (1999). Compensation (pp. 300-530). Burr Ridge, IL: Irwin/McGraw-Hill.
