MEMORANDUM

TO: Human Resource Department Manager

From Manager of Interclean Cleaning

Date: December 01, 2008

Subject: Develop a Compensation Plan

This memo is to inform the manager of Human Resource of remarkable ideas and rationales for a career development compensation plan for approval. Ms. Johnson, Manager of Interclean Cleaning, will describe a new compensation plan for her new team with Interclean and explain why her pay system will work, describe components of a reward package to motivate her employees to perform well, and describe her compensation plan benefits to individuals and to the company. The compensation plan with the manager’s ideas and rationales are submitted to the Human Resource Department Manager for your approval.

First, Ms. Johnson will describe a new compensation plan for her new employment team and explain her pay system telling why it will work. The new compensation plan Ms. Johnson poses for her team gives a list of direct cash payments and indirect payments to make employees reach peak performance. Direct cash payment includes incentives to motivate the team to increase customer satisfaction. Team members with the highest level of customer satisfaction will receive a cash bonus of $200. Interclean sails with an increase in customer satisfaction and business increase. Bonus awards are another cash direct payment employees are capable of obtaining for peak performance. Bonus awards will be given to employee receiving the highest number of sales for the year along with a frame and a special dinner. Ms. Johnson’s plan also involves indirect payments in the form of employee benefits. Her pay system will be fair and flexible for both managers and sales representatives. Her pay system will recognize increases for seniority and for performance. Her idea is creating a compensation plan to benefit the company, the individual and to make the payment system rewarding.

Second, Ms. Johnson will describe three components of a total rewards package that will motivate employees to reach their peak performance. Her idea of reward is keeping in mind the greatest reward for team motivation and peak performance is a cash bonus, recognition, and appreciation. Employees are interested in knowing their manager has their best interest in mind and the company recognizes and appreciate peak performance and seniority. Components of Ms. Johnson’s total reward package includes, first, base salary an employee is offered at the time of hire, next, bonuses the employee has earned from peak performance and last, sign on bonuses or cash paid to recruited employees. Other total reward components include individual growth, compelling future, positive workplace, and total pay. Reward components will be placed on individual component worksheets for each employee. Reward components will also help keep balance in the company.

Next, the manager will describe her compensation plan’s benefits to the individual as well to the company. Compensation programs provide payments to workers who are injured on the job or who contract a work-related illness. The compensation payments cover three areas: payments to replace lost wages, medical treatment and rehabilitation costs, and retraining to perform a different type of work. The company provides workers with benefits, by the company, to promote peak performance. Workers’ compensation costs employers billions of dollars a year, and is a major cost of doing business. Companies pay a percentage of clams with the worker to make insurance affordable for their employees. Benefits are a big priority for families in this country and are a major problem for people without insurance.

In summary, Ms. Johnson description of her compensation plan for her employment team proved is both memorable and understandable. She described her new compensation plan as a tool to stimulate peak performance and she presents compensation in the form of direct cash payments and indirect payments. She explains bonuses and employee benefits. She knew her pay system would work because her benefits are flawless. She describes three components of a total rewards package that involves base salary, bonuses, and sign on bonuses. Then she describes her compensation plan to the individual and to the company in the form of benefits. The compensation plan created by Ms. Johnson gives a valid reason for employees to stay on the job and give peak performance.