9 Factors To Consider Before Creating Your Employee Compensation Plan
Deciding how to compensate your employees can be a big deal. You want to make sure you pay them fairly and according to industry standards; however, you also want to keep the company afloat and all the lights on. Remember, you’ve got two kids who need to get through college, and one of them already looks like she needs braces.
So how does one go about deciding the best way to set up a plan?
9 Factors to Consider:
- What is your budget? While you will want to pay everyone the best of everything, that won’t always be possible. You might need to readjust your expectations or hire people with less experience if you can’t afford to pay them what the going rate is.
- Do you want to pay more in salary and less in benefits? Sometimes people want the highest salary and fewer benefits so they can choose their own health plans and dental options. Others want to make sure that their health plans are properly taken care of first. In the best of both worlds, it would be spread evenly across the map. See what the best is you can do with your budget.
- What makes your employees happy? Some people want benefits reflected in other ways, like a gym membership or a parking payment.
- Where do you live? Location can be a large issue for people, especially in metro areas. Remote working a few days a week or gas reimbursements can really help.
- How can you incentivize performance? Make sure there is some sort of golden ring, or nobody will have anything to aim for. Extra vacation time perhaps?
- Will they be salaried or hourly? This is huge, especially if you’re thinking about overtime with those hourly workers.
- What about pay raises? You will want to hammer this out before your first-year associates wander into your office with a huge ream of papers and an Excel spreadsheet that show their accomplishments since they started working.
- What are the other guys paying? Make sure to keep up with competition in the area, or your employees will walk out the door.
- Is everyone going to be on the same plan, or are the bosses on a different plan? Make sure that everybody knows what the strategy is at the start, or some of the lower-level employees might get upset.
If you aren’t sure how to set up a good compensation plan, contact SuitsOn Staffing for help. We have been in this business for quite some time and know how it works, so we are well versed in keeping employees happy. Get in touch with us today!
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