Employee Compensation and Benefits
Compensation is a very crucial aspect in Human Resource Management and impacts the rapport between employees and the executive. It is also one of the leading reasons of disagreement between employees and employers. Workers offer their services to an organization; they dedicate their skills, knowledge and time to the firm. By considering this dedication, an employer offers compensation to workers. Aspects that affect employee compensation can be grouped into external and internal factors. Internal factors are aspects within the organization that determine employee benefits and compensation. On the other hand, external factors are aspects that are outside the firm control that determine employee compensation and benefits.
Compensation that encompasses both benefits and pay is closely linked to performance appraisals. Employees with high performance are likely to get good pay rises (Qader, 2015). Various aspects impact employee’s compensation. An organization must consider both external and internal elements when planning and developing their employee benefits scheme.
Pay configuration and internal influences. Salaries, benefits, and wages depend on expertise, skills, and the level of the task. High-level ranks like chief information officer, chief financial officer, and the president are remunerated at high rates. Also, diverse tasks of equal significance to the organization are remunerated at identical rates. Reasonability increases as the level of management increases, and consecutively the pay. On the contrary, compensation is also affected by external influences. In determining employee remuneration, an organization must consider compensation by their rivals. If the oppone