Jva Corp.

JVA Corporation

To: Katelyn Van Michelson, CEO

From: Cindy Greer, Human Resource Director

Date: April 1, 2012

Subj: Compensation Restructuring

Dear Ms. Mickleson:

JVA Corporation had a devastating net loss of $53 billion during the last fiscal year and it has been suggested that we close a couple of international factories to help stabilize the corporation and remain in business. As the HR director I fear that these closures will have a negative impact for the employees as well as JVA Corp. The closings will move the production further away from the customer base and several employees will become unemployed. In order to avoid this drastic measure, I feel as though we need to look at our compensation packages along with implementing a new performance management system. This will help identify areas where cuts can be made without too much undue hardship being placed on the employees or JVA Corp.

Compensation

JVA Corp employees have become use to the intrinsic perks of the onsite exercise room and playground, along with having a break room and a kitchen, therefore; they should remain for the enhancement of the employee. However; I recommend that we drop the additional compensation programs with the exception of profit sharing until due time that the corporation is once again growing and prospering. Bonuses will be paid based on a performance rating that will be discussed later.

Eliminating the commission’s part of the compensation package will be the hardest hit for the employees. It will be suggested that the employees be evaluated using the new performance review format based on their current profile, external market and internal organization in order to determine how close the pay scale is to that of the industry. Using this information together with the job analysis and the performance evaluation, will determine the new baseline wage, medial wage and the high end wage. This may result in a pay raise for some employees, but more...