As you are expanding your business and taking on new employees, you may find yourself wondering how you want to go about setting up your compensation and pay strategies for those employees. While you may not realize it, there are many ways to go about compensating your employees. It is important to get to know more about how to choose the right compensation strategies, so you can be sure that you are doing what is best for your business, as well as for the employees you will be hiring.
Consider If You Will Be Offering Benefits
One of the biggest decisions to make when you are choosing and designing your compensation strategy is to determine whether or not you will be offering your employees benefits. If you are planning to hire only part-time assistance, you are not technically required to offer benefits like health insurance, vision insurance, and the like.
However, with full-time employees, a big part of the incentive for a person to take the job you offer them is what you are providing in terms of a benefits package. Deciding if and what benefits you will offer your employees will have a major impact on your compensation strategies.
You will need to determine the percentage of your compensation allocations that will go to benefits and the percentage that will go to salaries. And from there, you will have to further break down how you will go about spending money on benefits, to ensure that you are in budget and that you are able to provide the specific benefits that you are hoping to offer your employees.
Determine If Bonuses and Incentive Pay Are Good for Business
Many companies only offer compensation to employees known as base pay. This is a set amount per hour, month, or year that an employee will receive in compensation. However, there are other options available, on top of base pay, that you can offer to your employees.
Annual or quarterly bonuses based on company and employee performance are one such strategy. By offering your employees the possibility of a bonus (and an increasing bonus at that) based on how the company does and/or how the specific employee does at their job, you will be further motivate them to do a good job and to be fully invested in their work.
Another option is to offer base pay as well as an incentive pay rate based on performance. This strategy works best for employees in sales positions, call center environments, or the like, where their performance can easily be quantitatively measured.
Knowing these factors to consider, you can begin to better plan your compensation strategies for your expanding business.
For more information, talk to companies like Fox Lawson & Associates, A Division of Gallagher Benefit Services Inc.