PDF The Importance of Defining Your "Compensation Philosophy"

The Importance of Defining Your "Compensation Philosophy"

Louisiana SHRM Annual Conference 2014

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? James T Stodd, 2014

Philosophy...

According to the Bing and Merriam-Webster Dictionaries, "philosophy" is the... 1. Examination of basic concepts 2. System of thought or doctrine 3. Guiding or underlying principles and concepts 4. A set of ideas about how to do something

? James T Stodd, 2014

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Compensation Philosophy...

A system of thought and/or principles that guide an organization's decisionmaking with regard to the composition and distribution of formal rewards.

It results in a unified set of policies, practices, systems and perhaps a set of plans.

A well stated philosophy will address:

? What?

? Why, or on what basis? ? How? ? How Much? ? How Often?

AND, do so in a way that best supports attainment of the organization's mission, vision, and strategic objectives.

? James T Stodd, 2014

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Learning Objectives

Addressing the compensation philosophy and approach options for at each of the following: 1. Base pay/salary structures 2. Premium pay and overtime offsets 3. Bonuses, incentives and contingency-based reward programs 4. Retirement programs and other employee benefit plans

? James T Stodd, 2014

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Base Pay/Salary Structures

? James T Stodd, 2014

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