Compensation Plan

NEW COMPENSATION PLAN

FaLesia B. Miles

MGT/531 Human Capital Management

March 22, 2010

Bob Ficken, Jr.

To: HR Staff

From: FaLesia B. Miles

Date: March 22, 2010

Re: Compensation Plan, Pay Scale, and Total Rewards

I would like to thank all of you on your hard work since the new merger. You remembered to be fair in your treatment of all employees during this transition which helped us to retain or current employees. You have ensured excellent working relationship between yourself and the employees. You have maintained a healthy working environment that employees know that you will be fair and just.

New Compensation Plan

We have a new task; this task is to develop a new compensation plan for our employment team. In this new compensation plan we need to include incentive that will attract new employees, retain and motivate our current employees. Compensation, which includes direct cash payment, indirect payments in the form of employee benefits, and incentives to motivate employees to strive for higher levels of productivity, is a critical component of the employment relationship. Compensation is affected by forces as diverse as labor market factors, collective bargaining, government legislation, and top management’s philosophy regarding pay and benefit (Cascio, 2005). Through the process employees are given incentives to accomplish company goals that serve to align employee incentives with organizational goals and to communicate these goals to employees. In additional, the organization’s employees will be aware of the importance of their contribution in attaining company goals through the process. The system is designed to provide format to measure and reward achievement of both operational and value goals and thereby help ensure the success of the organization (Santone, Sigler & Britt, 1993, p. 85).

Keys to Successful Employee Compensation Plans ("How to write a compensation plan: Some fundamentals during a recession," 2009)....