Compensation Methods Paper

In: Business and Management

Submitted By u192986
Words 1771
Pages 8
Compensation is a routine approach to granting monetary value to employees in exchange for work completed and can accomplish numerous purposes helping in areas of recruitment, job performance, and job satisfaction. The competitive and global marketplaces as well as employee benefit programs today has become known as necessary tools used by companies to draw creative and useful employees. Meeting the requests and needs of employees can be rather complicated during difficult financial times in which businesses must find its balance between compensation methods and keeping overhead costs low. This paper will analyze the impact of various compensation methods and benefit programs on employees and organization. The paper will also relate salary and benefit administration strategies to organizational culture and performance.
Compensation Methods Compensation and benefit strategies are ways that organizations can use pay and benefits to recognize and reward employees’ contributions to the organization’s success (OPPapers, 2008). In a retail or customer service organization, workers are usually compensated by one of the following methods: 1. A direct salary or hourly rate, 2. Salary in addition to commission, 3. Quota bonus, 4. Commission without advances or 5. Commission with advances. Although commission payments are tied to sales, the requirements of the exemption are that more than half the employer’s compensation characterizes commissions on services; which can include all sorts of commission usually based on the services in which the organization provides and not solely those measured by sales of goods and services. An organization has several choices in regard to compensation methods. It not only affects the business, it also affects the future of the employees. Other than compensation and pay, one of the major compensation packages an organization can offer is…...

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