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Consistency in Company Compensation System

There is a need for the furniture manufacturing company to have a compensation policy. For the company to attain consistency, seven strategies will be necessary. Firstly, it will be proper to have working job structures for the company in all the departments. Evaluating the departments to determine job structures will help decide their worth and introduce standardization in terms of pay (Ensher, Crocitto, & Renard, 2018). Each job will have properly defined roles and responsibilities that will match the holders’ skills and experience.

Secondly, the company needs to allocate a budget for compensation. Following the budget allocation for payment will be the division of the funds to have one portion catering for salaries and the other to cover benefits or rewards. The salary amount that employees will receive will depend on their job description and structure. The job structures will also determine the amount of compensation for bonuses and other benefits.

In addition to the budget for compensation, it is appropriate to determine and establish salary ranges for various job descriptions in the company. The determination of the salary range should include such factors as competitiveness compared to similar jobs in the furniture industry and the location of the business. The salary ranges should mirror the size of the company and match the job description of the employees. To get a better salary range, there will be a need for research and audit to determine the flaws and, in the process, select the ranges appropriately without biasness. Thirdly, and critical of all, the company should have a policy on maintaining the salary ranges and the protocols for increment. Employees, including supervisors, will be required to understand the company’s compensation policy. To achieve consistency, fidelity to the compensation policy will be fundamental.

Reference

Ensher, E. A., Crocitto, M., & Renard, M. (2018). “Compensation and benefits”. In Teaching Human Resource Management. Cheltenham, UK: Edward Elgar Publishing.

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Essay4Business. 2022. "Consistency in Company Compensation System." November 25, 2022. https://essay4business.com/consistency-in-company-compensation-system/.

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Essay4Business. (2022) 'Consistency in Company Compensation System'. 25 November.

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