Compensation Structure
Question:
Discuss about the Manage Remuneration and Employee Benefits.
The remuneration strategy at Star Industries is aimed to attract and retain top quality employees by bringing changes and develop further skills and knowledge. In order to ensure effectiveness the management and the team has to ensure that each team member is remunerated according to the work he/she has done. The organizational policies are related to the reward procedure (Marchington, Wilkinson, Donnelly and Kynighou, 2016).
The organization will be giving away the wages as per the industrial standard without differentiating among the employees. This will give a fair position to the organization. The salaries of the employees are kept after consulting with the GM, Finance and Administration, HR Manager Etc. For the purpose of disbursing salary the Star Industries has classified the responsibilities according to three levels.
The employees are promoted according to the performance. The ratings are given by the management on the basis of the individual performance. The purpose is to guarantee long-term sustainability and goals. The employee is upgraded with the applicable proposal in relation with the results.
- Market plus philosophy: The employees are been paid in excess to the ongoing market rates.
- Market minus philosophy: The employees are paid lesser than the nominal industry pay. This strategy is based on paying lesser that the pre-decided market rates.
- It is important to consider the ongoing legislation regarding the remuneration.
- The management need to consider all the external factors including taxation while planning out the remuneration plan.
- The compensation and other benefits concerning the area need to be considered on priority in order to develop an effective plan.
- The internal policies of the organization and yearly appraisal cycle need to consider.
- Market standing of the organization need to be considered before development of the compensation policy
- Organizational policies
- The internal environment of the organization
- Effective HRM strategies followed in the organization(Bloom and Van Reenen, 2011)
Job evaluation is an important technique necessary to evaluate the individual performance. In order to gain long-term objectivity it is important to evaluate individual capacity on the basis of performance. Rewards at Star Industries are distributed on the basis of their performance. Employees performing at par are been rewarded monetarily. This allow in gaining recognition and long term understanding in between the employees and the employers (Scullion and Collings, 2011).
The organization is able to gain competitive over the other organization in the industry. In order to gain sustainable objectives it is important to evaluate individual performance without any biasness. This provides them with a strong base to perform well. This will help in gaining sustainability among the employees. The overall purpose it to understand the employee’s behavior and giving them a chance to grow efficiently.
This policy related to the job evaluation is reviewed annually. After 12 months’ of permanent service, every employees has to make an extra contribution to the superannuation Fund. The contribution starts on the next payday after the first anniversary.
For retaining employees, STAR Industries is devoted to attracting and retaining top quality employees. The organization ensures that the employees are highly satisfied develop additional skills and information essential to guarantee STAR’s continuing success.
Job evaluation is one of the important aspects in systematic progress for evaluating the relative worth of the organization. A wide-ranging analysis at every position derives value for the employer. The job evaluation is a measurement tool for the internal relativity. The analysis contributes to draw an effective job design. This process thereby helps in providing a specific competency by understanding skills and competency required to meet the job functions.
Performance Evaluation and Recognition
The overall goal of the organization is to evaluate the job evaluation program where the employee is promoted as per his qualification and responsibility. The job evaluation needs to be conducted considerably in order to imitate the current role and procedure. It is done to give recognition to existing employees There expectations is to retain the most efficient employees in the organization and to provide them with a guaranteed growth (Werner and DeSimone, 2011).
The organization has a better human resource policy helping them. Job Ranking is the simplest technique to make a job assessment by ranking jobs in order from highest to lowest. Job Classification divides the Groups in comparable positions into job classes based on pre-defined class terms. The Point Factor is widely used technique to conduct internal relativity. Job descriptions are evaluated to compensable factors. Points are allocated to the variety of factors that obtain a total score and conclude the appropriate pay level (Armstrong and Taylor, 2014). Lastly the Factor Comparison technique is used to identify Benchmark positions based on compensable factors. The factors are assigned in term of monetary and non-monetary functions.
Employees tend to make comparison with the organization in the same industry. It is thereby allowing in making a quick comparison. Star Industries is paying the best remuneration in the industry. Employees do compare it with the other companies that tend to raise their expectations (Noe, Hollenbeck, Gerhart and Wright, 2007).
People tend to compare their salary with the other people working in the organization. Star Industries is paying remuneration as per the level of experience with the company. There is no bias in case of disbursement of salary. Employees are paid according to the amount of experience and the level at which he/she is working (Stahl, Björkman and Morris, 2012).
Employee motivation is the key to gain trust in employees. Employees leave the organization in case if they are not given recognition. For gaining employees trust it is important to develop a systematic recognition process.
It is recommended that the organization should carry out the recognition process by evaluating it on the yearly basis. Employees should be listened in the appraisal meeting and should be given an opportunity to measure effective growth (Schuler and Jackson, 2008).
In order to realize employees efforts the organization need to realize individual efforts. There is an effective appraisal, compensation and bonus method. Bonus is been paid on the annually basis. Employees are given an opportunity to present their views and provide with an effective review at the end of the year.
Job Evaluation Techniques
The Level 1 management positions includes • General Manager, Manufacturing • General Manager, Sales. The base salary for this category is (LL) $74,000 to (UL) $104,000.
The Level 2 management positions are: • General Manager, Finance & Administration • IT Services Manager The base salary for this category is (LL) $63,000 to (UL) $80,000.
The Level 3 management positions are: • General Manager, Human Resources • General Manager, Marketing • Area Sales Managers. The base salary for this category is management positions is currently (LL) $55,000 to (UL) $63,000.
Whereas the salary of the CEO is higher than Level 1, and is evaluated annually by the Board of STAR Industries.
The organization is positioned at one of the most effective place by gaining employees interest. They are deliberately functioning to provide with applicable results. Star Industries is giving the best remuneration in the industry and thereby giving employees with other benefits in order to grow more efficiently. They have eventually gained a better position in the market due to its objectives and zeal to over perform. The employees are hired on best packages that are helping in meeting the objectives of the organization (Price, 2007).
The benefits are been offered at the prudence of the CEO and the Managers at STAR Industries. They receive an annual bonus connected straight to performance of the organization. The Bonuses given to the employees are reviewed annually. The Incentives Level 1-3 managers are also engaged in the Manufacturing and Marketing of STAR Industries.
Employees, who are under the direct employment for a continuous 12 years of service, will add a supplementary 2% to every management level, or an extra 1% to each usual employee’s superannuation. This part is completely employer-funded Policy. The purpose is to guarantee long-term sustainability and goals
The salary is based on the different level of pay scale at each and every level. There are three levels in the organization. Salary is being paid according to the pre-decided remuneration. Moreover the base salary for Level 1 is divided into $74,000 to (UL) $104,000. The level 2 is receiving a salary of $63,000 to (UL) $80,000 whereas the level 3 is receiving a salary of (LL) $55,000 to (UL) $63,000.
At Stars Industries the Benefits are reviewed annually and applied to Level 3 and above Management positions. It is evident to notice that the FBT is applicable on some benefits. This technique allow in retaining the employees for a longer time-period. It creates a sense of belongingness with the organization. An employee feel accomplished and wants to work more proactively in organization growth. The overall purpose is to gain relativity in terms of growth and competitiveness. It is one of the employee retention technique used by the employers to create differentiation in the mind of the employees. It is possibly done in order to create relationship between employee and employer. In order to retain employees the Level 3 employees are receiving FBT. This is important for gaining organizational goal.
It is recommended that the organization need to develop an effective employee engagement and management plan. This is for guaranteeing a systematic growth. An employee requires growth after a definite period of time. The organization is dedicated towards individual growth and development. In order to gain long term sustainable growth the organization has to develop an effective employee retention plan. This can be made possible by complying with the effective policies (Storey, 2007).
Further the organization has to develop a well-managed plan by motivating an individual growth and development. By improving the current HRM function it is possible to manage the organization in the most appropriate way. . Rewards at Star Industries are distributed on the basis of their performance. Employees performing at par are been rewarded monetarily. The overall purpose is to gain competency on a long run and to attain longevity in term of employee retention. The employer has to develop an effective an appropriate function by gaining long-term effectiveness. The purpose of the human resource management function is to develop an effective growth status. This is to provide an individual growth to the employees and to manage growth
References
Marchington, M., Wilkinson, A., Donnelly, R. and Kynighou, A., 2016. Human resource management at work. Kogan Page Publishers.
Noe, R.A., Hollenbeck, J.R., Gerhart, B. and Wright, P.M., 2007. Fundamentals of human resource management. Boston, MA: McGraw-Hill/Irwin.
Price, A., 2007. Human resource management in a business context. Cengage Learning EMEA.
Schuler, R.S. and Jackson, S.E., 2008. Strategic human resource management. John Wiley & Sons.
Scullion, H. and Collings, D., 2011. Global talent management. Routledge.
Stahl, G.K., Björkman, I. and Morris, S. eds., 2012. Handbook of research in international human resource management. Edward Elgar Publishing.
Storey, J., 2007. Human resource management: A critical text. Cengage Learning EMEA.
Werner, J.M. and DeSimone, R.L., 2011. Human resource development. Cengage Learning.
Armstrong, M. and Taylor, S., 2014. Armstrong’s handbook of human resource management practice. Kogan Page Publishers.
Bloom, N. and Van Reenen, J., 2011. Human resource management and productivity. Handbook of labor economics, 4, pp.1697-1767.
Order an Essay Now & Get These Features For Free:
Turnitin Report
Formatting
Title Page
Citation
Outline
