Pay and Benefit
Pay and benefit refers to compensation an individual receives from employment (Jones, 2007). Compensation can be monetary or non-monetary in nature. Decision makers in organizations are paying more attention to pay and benefit schemes in order to tailor them to suit both organizational and employee needs.
Pay and benefit management to improve employees should begin with carrying out pay and benefits reviews in order establish which adjustments are necessary to develop value-creating compensation schemes. Pay and benefits should address each individual employee to establish adjustments necessary to make them more productive in the organization. A good pay and benefit scheme addresses employees financial and personal needs enabling them to concentrate on their tasks at work. The pay and benefit package should be commensurate to the work done and position an employee holds in the organization (Jones, 2007). Management should introduce car, housing, and insurance benefits to the compensation package as an incentive for employees to increase their productivity. The pay and benefit should be sensitive to employees with families by introducing statutory maternity and paternity compensation. In addition, management should introduce childcare for employees with small children to ensure they are at ease when at work because they can spend time with their children during breaks.
According to Jones, (2007), a good compensation scheme helps an organization to attract and retain high skilled employees. This reduces cost of recruitment due to reduced rate of turnover. Well-tailored pay and benefit schemes increase employee’s job satisfaction thus increasing their productivity and effectiveness (Jones, 2007). In addition, pay and benefit schemes help an organization to avoid bad publicity and legal costs involved in pay related lawsuits.
Jones, G.R. (2007). Introduction to Business: How Companies Create Value for People. New York: McGraw Hill. Pp. 398-432