Presented by Julie Caspar. Cris Wildermuth, Ed.D., SPHR Assistant Professor Drake University Adult Learning & Organizational Performance cris.wildermuth@drake.edu.
Post on 03-Jan-2016
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Welcome!
Cris Wildermuth, Ed.D., SPHRAssistant Professor
Drake UniversityAdult Learning &
Organizational Performancecris.wildermuth@drake.edu
Presenter
Julie CasparPresident, HR HotlineAnkeny, Iowa(515) 635-0180julie@hrhotlineinc.netwww.hrhotlineinc.net
Agenda
• Welcome• Defining Compensation• Business Strategy and Compensation
Philosophy• Compensation Specialties• Additional Strategic Considerations• Cases• End Session
Poll• TRUE or False:
– At the beginning of the 20th century the focus of compensation was pay for work; by the end of the 20th century the focus of compensation was more on pay for results.
AnswerTRUE
Compensation EvolutionDomestic
Competition
1900
2012
GlobalCompetition
Pay for Work
Passage of Fair Labor
Standards Act(1938)
Benefits (Compensation)
Drive Performance
Longer Term Strategy
Achievement & Pay
Equal Pay Act (1963)
Equity
Market Based
Merit
Ongoing Legislation
e.g. Lilly Ledbetter
Davis-Bacon Act 1931 Pay for Results
Total Rewards
American Compensation
Association (1955)
Work-Life Balance
Development
Cash provided by an employer to an employee for services rendered. Cash is
comprised of ….
Compensation is …
Strategically Aligned Compensation Objectives
• Legal compliance• Cost effective• Internally, externally, and
individually equitable• Drives performance and results
• Seniority Basis• Across-the-board raises• Pay scales raised annually• Industry comparisons of
compensation only• Holiday Bonuses
• No raises for length of service• No raises for longer service
poor performers• Market adjusted pay
structures• Broader industry comparisons• Bonuses tied to performance
results
Compensation Philosophy Continuum
Entitlement Performance
Mathis, R.L. & Jackson, J.H. (2006). Human resource management 11th edition. Mason: Thomson South-Western.
Market Positioning
At Market Compensation programs are valued within close proximity to market.
Lag
Compensation programs are at an affordable level for organization. Takes advantage of abundant supply of potential employees in a loose labor market.
Lead Paying for higher qualified, more productive workers by positioning pay above market.
• Compensation is cash provided by an employer to an employee for services rendered.
• Compensation is one of multiple variables of what may drive a business strategy based on the Total Rewards Philosophy.
• A clear depiction of company mission, vision, and goals need to be made before a strategic compensation plan / program can be developed.
• A compensation philosophy is critical to the successful alignment of the business strategy.
• Organizations need to decide whether their compensation programs are to be more entitlement or performance based and how either will advance the business strategy.
• There are multiple and various considerations to be made in determining compensation programs that will ultimately lead to business achievement.
Thank you!
Julie CasparPresident, HR HotlineAnkeny, Iowa(515) 635-0180julie@hrhotlineinc.netwww.hrhotlineinc.net
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