Compensation

Career Development Plan Part IV-Compensation

Gawain Minor

HRM/531

Mrs. Healy

10/3/10

Many employees look at the compensation when it comes to accepting or declining a job. Compensation plans can also determine if an employee stays somewhere or begins looking for a new job. A compensation plan is what you pay someone to entice them to continue to do work for your company. Many people are more likely to hold a job longer if they are offered a good compensation plan and rewards. There are not many people who want to work for nothing.

When InterClean institutes the new pay system they need to be mindful of fairness and equity within the organization. In the text the three areas of equity cover internal equity which involves the actual worth of the jobs to the organization, external equity which are wages paid by an organization that is fair in terms of the competitive market rates outside the organization and finally individual equity which ask is the individual rate of pay fair and relative to that of others that do the same job (Cascio, 2006.)

The compensation plan for the employees will consist of a salary and commission for the sales team. They will get a base salary and then make commission off of their sales. The employees will also get quarterly bonuses and have the option for health coverage along with dental, paid holidays, flexible work hours and paid time off. Employees will also receive a 401K plan option for retirement.

The pay system will work because by using a base salary the employees will be guaranteed a weekly pay to take home and pay bills and then they will get the chance to take home more by how many sales and the amount of sales they make. The commission is an incentive to encourage them to sale more so they make more money. By giving the employees the options for health and retirement plans it gives them a little flexibility. They do not have to take it if they would prefer the higher salary but...