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Compensation in the Workplace

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Submitted By LtWaffles33
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Compensation in the Workplace
12/10/15

Compensation is a major part of the Human Resources field. It could be a major deciding factor when talking about what attracts and keeps people at a particular business. Compensation is defined as “Compensation is the total amount of the monetary and non-monetary pay provided to an employee by an employer in return for work performed as required. Essentially, it's a combination of your pay, vacation, bonuses, health insurance, and any other perk you may receive, such as free lunches and parking” (Heathfield, 2015). Compensation is based on many factors. And certain companies pay more attention to these factors than other companies do. The first major subheading under compensation is total rewards and compensation. Designing reward packages that appeal to a variety of people is one way companies attract and retain high quality employees. Companies address pay and benefits using something called a total rewards philosophy. A total rewards philosophy is “the monetary and nonmonetary rewards provided by companies to attract, motivate, and retain employees” (Mathis, R, Valentine, and Jackson, 2013). An effective total rewards approach balances the interests and costs of the company with the needs and expectations of the employee. Another way that companies determine the market rate for a particular job is they do salary surveys for that position. These surveys show what other companies are paying for that position along with what benefits are included for that job (Heathfield, 2015). These surveys can be fairly accurate and can be a great resource when trying to figure out what the compensation rates should be. There are several components of compensation that help make it the important topic that it is. First, there is tangible direct rewards. Under this category, you find base pay which are the wages and

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