Structuring Employee Wage and Benefit Policies

It is important for employers to know the advantages of offering competitive compensation and employee benefits when attracting new talent, particularly in an increasingly globalized and diverse labor force. Most businesses utilize traditional employment packages, but leading businesses have adopted more creative compensation structures. There is a growing trend towards creating work-life balance in the work place. Work-life perks and other creative benefits are not just attracting new employees to the work place, these perks have proven to result in much better employee productivity and retention rates.

Traditional forms of compensation are based on competitive industry standards and location for a particular occupation. Sales compensation structures still tend to be a combination of a substantial base wage, but not enough for the employee to remain satisfied. Offering an attractive commission to maintain motivation for selling is recommended. Some newer trends in compensation include giving bonuses or commissions to non-sales employees who have produced desirable results. Also called Incentive Compensation, this pay structure is a way to positively reinforce good behaviors without drawing attention to unwanted behavior.

Other traditional benefits include health insurance including dental and vision care, disability and life insurance, paid time off or leave, stock options and retirement plans. A more controversial topic has been health benefits for employees’ domestic partners. While extension of this benefit has been on a slow rise, it is becoming more commonplace, so it is important to consider offering it to keep an edge over the competition.

The best companies to work for give all of these standard benefits and more. They are offering to pay for childcare, education assistance, adoption assistance, flexible schedules, and telecommuting. These perks give a huge advantage in attracting the best talent and maintaing high retention rates. These offerings improve employee morale which has a positive affect on the company’s bottom line.

Furthermore, they are getting creative to compete with some of the younger, fresher companies. They are offering regular guest speakers, on-site classes for self-improvement (personal finance, yoga, nutrition), company-sponsored meals, on-site shopping, and many more ways to create a more relaxed work environment while helping to achieve the ultimate goal of greater work life balance.