Most organizations spend an enormous amount of money on compensation and benefits of an employee. Whenever an employee joins in an organization, the salary and benefits are attached to the contract. Compensation and benefits are the extra benefits and remuneration given to an employee for serving the company well. The possible benefits are health care, retirement, paid vacations. According to Dessler and Varkkey (2011), it is said that organizations offer benefits and compensation to attract employees. For this report, the FMCG industry is chosen. In this report, the employee compensation and benefits of employees in Unilever is developed. Unilever has established and get known to people from 20th century by the founder William Hesketh Lever. Unilever has near about 400 brands offering from food and beverages to personal care and other branded products.
Employee compensation and benefits package
For a new secretary position, the following employee compensation and benefits package will be offered. The packages are medical and Dental plans, life insurance, domestic partners and children, healthy care, retirement plans, tuition reimbursement, paid vacation. Besides this Unilever also provide performance related rewards to retain long term employees. In Unilever, employees also get a fixed benefits based on individual performance.
Exempt and non- exempt employees
Exempt employees refer to those who do not cover the requirements of overtime of Federal Labor Standards Act (FLSA) (Mckay, n.a.). The employees like executive, administrative, and managers will come under this category. Non- exempt, on the other hand, are those employees who are the subject matter of the Act and will get 1.5 times more than their regular payment if the workers work more than forty hours in a week. Most blue collar employees like electrician, construction workers fall under this category. In Unilever, executives and managers are exempted and do not get any additional pay for the overtime work.
Other benefits to consider for enhancing employee performance
Other benefits that the Unilever needs to consider are- flexible working hours, appreciating employees for the work done, participate and encourage employees in decision making, rewarding the best employee of the month, celebrating the birthday of an employee, extra payment for the overtime.
Government regulations and influence on compensation
Government plays a significant role in influencing employee’s compensation. Government is concerned about three important issues- whether fair pay in an Organization is going on or not, protection of employees from exploitation and concern about the disadvantaged employees. Government regulation also influences on compensation of Unilever. Under the health care Act, Unilever is bound to provide health related benefits of employees because the government has regulated. Under the Fair Labor Standards Act (FLSA), Unilever is bound to give minimum wage rate of $5.15 an hour to the workers. Other major issues that are the most concern for government is the protection of child labor and minorities. According to the law, no person is allowed to work in a hazardous task less than 18 years. Unilever carries out the issues regulated by the government.
Employee compensation and benefits offered by educational service industries and hospital industries
Educational services and hospital organizations have been taken into considerations for analysis and compare the employee benefits and compensation of Unilever. Both the organizations are providing employee benefits and compensation, but the quantities of benefits are different. Both educational services and hospitals provide paid leave benefits to the employees. Both educational services and hospital belong to service sectors, therefore, according to data collected from Bureau of Labor Statistics (2013), stated that paid leave benefits in the service sector is less that is $1.99. But Unilever is an excellent producing industry. In Unilever paid leave benefits are significantly higher that is employer cost is $ 2.35 per hour worked. Other benefits educational services and hospitals are offering to employees’ are- supplemental pay, insurance, health benefits, retirement and savings (Bureau of Labor Statistics, 2013).
Unilever is a multinational company, and they adopt many diversified strategies to retain employees by providing various types of employee compensation and benefits. One of the most essential benefit packages used by Unilever is fixed that is basic plus benefits for performing well at organization. The benefits will motivate an employee to show more talent in them. Other unique benefits that Unilever provides are celebrating a birthday of employees, farewell party, recreational trip, rewarding best employee of the month. The package Unilever is using will enable employee to maintain in the business for many years and the upper management should implement Unilever employee benefits package.
The way competitive compensation and benefits package will align with the HRM strategy
The compensation strategies operated by organizations are linked to their Human resource strategic plans. They involve organization's position in the job market, total cash, rules and principles of the main bonus in the organization. The top management approves the compensation plan as the impact of costs is enormous on the organization (HR Management Guide, n.a). In Unilever, the Human Resource department takes the compensation and benefit packages for employees. The HR department decides the type of benefits to be provided to new employees. If the newly appointed employee has an MBA degree or other relevant degrees then his starting basic salary will be more compared to others who do not have the degrees.
Every Organization aims to retain the current skilled employees and to attract the new talented employees. Talented employees need more than just working in a renowned company. Talented employees need favorable working environment, recognition for performing well, promotion, holiday leave, paid leave, recreational trip, retirement benefits, etc. Unilever is a multinational organization and follows a standard employee compensation and benefit package so that the employees do not get de-motivated and dissatisfied. If the employees get good employee compensation package then they will never leave the job. Hiring new employees added enormous cost for the organization rather than retain the current employees till the retirement. Therefore, every top management of an organization should follow an absolute standard to retain the employees.
Bureau of Labor Statistics (2013). Overview of BLS Statistics on Pay and Benefits. Retrieved from http://www.bls.gov/ro9/ro9_az.htm#wages (4-6-14)v
Gary Dessler, Biju Varkkey (2011). Human Resource Management (12th Edition), Pearson Prentice Hall, Noida – 201309 HR Management Guide. (n.a.). Compensation Strategy. http://www.simplehrguide.com/compensation-strategy.html (4-6-14)
McKay, D.R.(n.a). What is an Exempt Employee? About Career Planning. Retrieved from http://careerplanning.about.com/od/federallawsus/g/def_exempt.htm (4-6-14)
SBA.gov (2011) “Employee Benefits” Retrieved June 6, 2014, from http://www.sba.gov/content/required-employee-benefits (4-6-14)