Strategy

Plastec Company: Machine Operator Strategic Compensation Plan

Machine Operator Strategic Compensation Plan

Plastec Company has not had a good compensation plan, and as a result; the turnover rate has been high. In an effort to make the compensation plan more effective and competitive, Plastec needs to compare their wages including variable pay and benefits with other employers. Additionally, recruiting and retaining machine operators has been a recurring problem and has contributed to the lack of professional development. In addition to the unattractive compensation plan the company needs to provide appropriate benefits that cover the middle aged with a mix of employees who are single and others who have families.

Comparing Pay and Benefits

Recent exit interviews have revealed to Paul and John (HR managers) from Plastec Company that pay and benefits are better at competitor companies such as Acme, including take home pay/holiday time, and vacation. Using some simple analytical methods, the HR team can compare Plastec’s pay and benefits with leading competitors; thus, this process will reveal important labor market information.

Methodology. Paul can use numerous methods to determine comparable pay and benefits locally, nationally, and globally. The baseline data, to include raw data on benefits such as pay, unemployment, Social Security contributions, retirement, holiday and vacation, and wages can be used to compare organizations (in this case, Plastec and their competitors), (U.S. Department of Labor, 2009). Additionally, information obtained from the U.S. Bureau of Labor Statistics can be utilized to compare true employee compensation rate on all benefits the organization has to offer (U.S. Bureau of Labor Statistics, 2012).

Benefit Education. Benefits often allow organizations to retain their best talent, giving that same organization a competitive advantage. It is vital that Plastec Company discover new ways...