Sustaining Employee Performance Paper

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Compare Possible Compensation Plans

An employer must, in addition to evaluating each employee, also evaluate each job within the company and based on their assessments, they are able to design a compensation package for that job that ensures the company gets the best value from their investment. In looking at the two jobs discussed above, First Data could use the classification method, or the point method when determining what each job is worth to the company. In the classification method, factors such as skill level, required knowledge and responsibility is used to categorize jobs. Each established category is then ranked by the company in regards to value. This method is very effective, but because the classification process is subjective, one class of jobs may be under/overvalued by the classifier. For example, there are less training and skill requirements for First Data's Customer Care Agents, so the classifier may regard this type of position as low level, without consideration to the fact that the relationships built by this team directly influences the company's continued revenue stream. The point method, on the other hand, does not classify the job itself; instead, it assigns points to the job based on required education, skill and responsibility levels. This is a fixed approach, because the job function may evolve, but its assigned value remains static. Again here, the Customer Care job may be undervalued, because of the relative low level of skill/knowledge and responsibility requirements.

The Importance of Providing Employee Benefit Plans

Still, no matter which approach is used; a company must establish a well-designed and competitive compensation package for each job. At First Data, both jobs have a compensation plan that provides 2.5 personal vacation hours every 40 hours worked, 10 holiday and 5 sick days, health insurance, and a 401K retirement plan. However, Customer Care Agents can expect to make 3-5 dollars less an hour. In addition, Contract Support Specialist is paid an annual performance bonus, while Customer Care Agents are not. Based on the discussion on Job Evaluation, the difference in pay and benefits are to be expected. Still, according to Fundamentals of Human Resource Management (DeCenzo, 2013), it is becoming widely accepted by companies that employees place a great deal of value on their benefits. Benefits such as retirement, medical, education reimbursement are factors that not only attract quality employees, but keep them on the job. The medical benefits plan at First Data, for example, give employees medical coverage that some would not be able to afford if they would have to pay the insurance rates in full. The benefits companies provide are attractive to employees and are heavy determining factors as to whether or not they continue with the company.

Conclusion

When ensuring a company’s goals are achieved, it is important to have a highly productive workforce. In order to achieve this, companies must make sure they have a means of evaluating its employees. Companies also need to remember that a successful compensation plan chiefly influences retention rates, but also directly influences employee morale, and the degree to which the employee strives to meet objectives outlined in the performance management system. Overall, it is simply good business for the employer to make a concerted effort to attract, and most importantly to retain quality employees.

References

DeCenzo, D., & Robbins, S. (2013). Fundamentals of human resource management (11th ed.). Hoboken, NJ: John Wiley & Sons

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