What Is A Compensation Strategy?
As a small business owner, you know that it's important to make sure that your employees are compensated fairly for all their work. Trying to figure out the appropriate compensation for your current employees and any new employees can be very difficult.
Most people think of employee compensation as just wages. However, while wages are part of employee compensation, they aren't the only thing that makes up employee compensation. Compensation includes absolutely everything that your employee may get through their employment, health care benefits, incentives, bonuses, retirement benefits, as well as any other things that you may routinely give your employees. The entire package is called your compensation strategy.
Your compensation strategy is more than just that entire package, though. It's a formal statement and plan that your employees should have access to. It should also include information about pay ranges. Two employees may be hired for the same basic position but get different benefit packages because of experience or education. The general reasons why they are getting paid should also be in the compensation strategy.
Generally, an HR department would be in charge of helping to write up the compensation strategy. They do that by looking at a lot of things. One of them is your budget, how much you can set up to spend on all the various kinds of benefits. They will also keep track of what the standard benefit package in your industry is. Keeping track of that will mean that your compensation strategy will need a regular audit. It's that audit that will make sure that your compensation package is competitive within your industry.
If you don't have an HR department, you may not have time to set up a good compensation strategy or have the time to do the research to make sure that your compensation package is competitive and stays competitive. If that is the case, then you will probably need some help. One thing that you can do is to hire consultants that can help you with that. The consultant will come in and look at what salary you are offering your employees, plus all the benefits. Once the consultant has done all that, they will look at everything compared to what your industry standards are.
Making sure that your employees are getting adequate compensation is important. Knowing what a full compensation strategy is can really make it so that you know everything you need to have. For more information, contact local professionals like Fox Lawson & Associates, A Division of Gallagher Benefit Services Inc.