An effective compensation system must satisfy three criteria:  (a) fairness, (b) linear relationship between performance and pay, and (c) organizational success.  While always important, compensation has become more integral to employees during the past several years.  Sage organizations continue to rely upon compensation as a strategic advantage capable of benefitting employees, the company, and the future.

A simultaneous index of motivation, reward, and status, compensation is a complex equation that stimulates creativity, fosters resourcefulness, and gauges accountability.  The principles inherent within a company’s compensation system aver the organization’s values, character, and destiny.  From those tenets, an employee, an applicant, or competitor can singularly articulate the company’s relative standing within an industry.

The amount of detailed consideration necessary to design a merit-oriented pay system cannot be overstated.  Whether it is an hourly wage rate, salaried compensation, discretionary bonus plan, or an executive pay package, the legal, individual, and organizational factors must be uniquely weighed, debated, and validated.  To ensure a sound compensation system that attracts, motivates, and retains high-caliber talent, the following factors deserve attention:

  • Compensation Plan
  • Exemption Classification Analysis
  • Incentive Plans
  • Internal, Individual, and External Pay Equity
  • Job Descriptions
  • Wage and Hour Issues
  • Performance Appraisals
  • Salary Surveys
  • Accountability
  • Performance Management Strategies

Merit is a strategic advantage.  Employee compensation is too important, fragile, and indelible to be perceived as being arbitrarily conceived, capriciously assigned, or politically distributed by the workforce.  Always have a strategic advantage.

Steve Cesare Ph.D.

has more than 25 years of Human Resources experience. Prior to joining The Harvest Group, Steve worked with Bemus Landscape, Jack in the Box, the County of San Diego, Citicorp, and NASA. Steve earned his Ph.D. in Industrial/Organizational Psychology from Old Dominion University, and has authored 68 human resources journal articles. As a member of The Harvest Group, Steve’s areas of expertise include: staffing, legal compliance, wage and hour issues, training, and employee safety.  Read Steve's full bio.

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