Good employers are hard to find, but so are good employees. To retain top talents that will make a big difference in your company’s success, you need to prepare a competitive, and desirable compensation plan.
What is a compensation plan?
Simply put, it is the manner of paying your workers, according to the job or role they take. They vary widely because different employees require a different pay structure, depending on what motivates them and helps them achieve their financial and career goals.
To determine what works, you must know what is desirable for them, taking special notes on monetary and non-monetary offers that will equate their value to the company.
Apart from an attractive compensation plan, it also helps to provide employees with a fun working environment. Establish camaraderie and teamwork by offering bonding activities in which they can interact with the rest. It is also worth ensuring that every corporate celebration will give them much delight.
You can hold funfair events like those provided by https://www.wearetricycle.co.uk/ for your employees during special occasions like company anniversaries, Christmas parties, and others.
What are the basic elements of a compensation plan?
Before going into details about the elements of an ideal compensation plan, care to understand that compensation is grouped into two: direct and indirect.
Direct compensation is the foundation of the payroll. It accounts for the basic salary, hourly rates, commissions, and bonuses. Indirect compensation, on the other hand, pertains to employee benefits of different kinds.
To develop a desirable compensation plan means paying attention not just to the monetary compensation but also to the other benefits. Here are the elements to stuff your compensation package with and make it attractive to the people on your payroll:
- Base salary. The regular pay is determined according to the job description. It should also be checked against the market information for equity. On top of that, you should also denote the growth potential in the package. Employees surely need to know from the get-go your raise schedules and other fringe benefits.
- Bonus and commissions. Different bonus packages may be offered, depending on the job the employee is signing up for. Salespeople, for example, get a commission for hitting targets. Others get a profit-sharing bonus or a performance bonus, which are largely based on merits.
- Health care coverage is another feature that you may want to add to your compensation offer to make it more attractive.
Employees who sign up to work for you will judge their success rate and how soon they will achieve their established goals based on your offer. That’s pretty much the yardstick of how long they will work for you and how eager they would be to grow with your company.