COMPENSATION STRATEGY.

Compensation Strategy



Compensation Strategy

Compensation

The term compensation is used to 'designate everything that people are getting for their work' as employees of a company. Apart from the salary, employees are given incentives, when available, and benefits, both cash and in kind. The other important part of compensation is for the satisfaction that staff to obtain directly with the execution of their work and the conditions under which it happens (Henderson, 2009).

Compensation Philosophy

Compensation and benefits are of primary importance for employees as a competitive compensation mix can help retain employees by keeping the employee satisfied and can help him focus on the job, instead of fretting over and looking for a better paid job. If the compensation package has various elements, how they can take decisions on the level of compensation to employees in the company? Under these concepts, the characteristics of a compensation package can be analyzes on different levels of integration. Indeed, when discussing compensation package, one should be clear about the degree of integration or structure is discussed (Henderson, 2009).

Compensation speaks of the base compensation structure, when we refer to 'nominal monthly salary multiplied by twelve months'; of structure guaranteed cash compensation, when referring to the base compensation plus any guaranteed cash benefits such as vacation pay and bonuses or vouchers pantry or savings fund (Stefan, 2005).. When one refers to the guaranteed compensation in cash, plus all contingent incentive payments received by staff refers to the total compensation structure to dry, when we are referring to the total cash compensation, plus all the benefits in kind or benefits received by staff, value equal to its economic value. If we talk about the effectiveness of an approach, or system, particularly for making decisions on staff compensation, it is necessary first to consider what the goals of ...