- Term Papers and Free Essays

Recognizing Employee Contributions

Essay by   •  March 22, 2018  •  Essay  •  1,174 Words (5 Pages)  •  591 Views

Essay Preview: Recognizing Employee Contributions

Report this essay
Page 1 of 5


Recognizing Employee Contributions

Nikiria Stinson

                                                                  June 13, 2016

 HRM 500:  HRM Foundations

Professor Jo-Rene Queensberry

Recognizing Employee Contributions

        I am a HR manager (HRM) of a new retail company that has both retail stores and Internet sales.  The company I work for has been doing well initially and showing a success in proceeds and productivity.  Unfortunately, there have been some employees who feel they want to leave due to the basic compensation plans offered. The company has realized the importance of these enhanced benefit plans and has placed me in charge of seeing them implemented. 

Incentive Pay

        There are a couple of methods I can use, as a HRM that would determine what the incentive pay should look like. The first thing I would do is determine the disadvantages and advantages of a lump-sum incentive plan (Quast, 2016). The one advantage of the lump-sum incentive plan for the company is that it will motivate the employees to perform better which increases productivity. A disadvantage would be that the motivational tactic could fade away one the incentive ends or the employee’s quota has not been met. This would effect the company’s sales negatively and may cause employee moral to decrease, which would ultimately affect productivity.

        A second method for determining incentive pay is by determining the needs of the employees. It’s up to the HRM to get an idea of whether and what kind of incentives appeal to the employee and how it will help the company meet its goals (Gordon & Kaswin, 2016). “The amount of the incentive pay should depend on the employees’ income, the amount of effort needed to invest, likelihood of obtaining the reward, acceptance of risk, equity of reward and contribution, and industry standards” (pg.3). In a retail industry, the company’s revenue will weigh heavily in determining how much the company can invest in incentive pay. This id probably why most retail companies have quotas associated with their incentives. The competition in the retail industry will lead to an increase in sales and production for the company which will ultimately result in an increase in revenue for the company (Grant & Sugarman, 2004). This method then becomes a benefit to the company, the groups, and the individual employees. Both of these methods can led to the success of the company and an overall contribution to the continued growth of the company and to the employees.

Legal Requirements

        It is imperative that the core legal requirements that affect employee benefits in today’s competitive environment be clearly understood by the employer. The legally mandated benefits that a company must offer its employees are, financial compensation, Social Security, Unemployment Insurance, Workers’ Compensation, Family and Medical Leave Act, and time off for civic duties (Taube, 2014). These laws are set in place to protect the employee as well as their family. If the employers do not include these laws in their benefits package, they will put the company at risk.


        There are several other benefits an employer could offer which may attract better employees. Some of the most popular benefits that are not required by employers are retirement plans, paid time off, life insurance, and dental coverage (White, 2016). These four benefits provide the employee with flexibility and shows the employers care and concern for the wellbeing of its employees.

There are three important concepts that a company must consider when designing a benefits plan, prioritize benefits options, consider long term needs, and communication considerations (White, 2016). In order to decide what benefits to include in a benefits package, the company would first have to shop the market for the most attractive as well as assess the employees’ needs within the company. White (2016) also suggest to evaluate more than just the immediate needs of the company. The benefits package should also consider and incorporate the company’s long-term goals. The company’s approach in how they decide to communicate its’ benefits should be taken into consideration. Depending on how the information is communicated, it can have an effect on morale which may result in affecting the success of the company.


There are several factors that strongly influence effectually communicating benefits plans (Gilligan, 2016). Most companies have an array of age groups working for them and technology may be a better source of communication to some of them. It’s important to include the currents needs of the employee when communicating. The communication should not just be done once per year; it should be conducted all year around due to the demographic changes the employees may have.

Ethical Risks

        There are ethical risks associated with making incentive pay a large portion of employees’ total compensation. Frequently, the term incentive has been linked to the word reward (Grant & Sugarman, 2004). One ethical problem is, incentives can be a means of making an employee to what you want them to do. This would be considered more like a bribe instead of incentive. Another ethical concern is the company’s intentions and concern for the employee when offering the incentive. The employer is only offering the minimum incentive for the company’s maximum gain, then that would be an issue.



Download as:   txt (7.2 Kb)   pdf (126.5 Kb)   docx (14.2 Kb)  
Continue for 4 more pages »
Only available on
Citation Generator

(2018, 03). Recognizing Employee Contributions. Retrieved 03, 2018, from

"Recognizing Employee Contributions" 03 2018. 2018. 03 2018 <>.

"Recognizing Employee Contributions.", 03 2018. Web. 03 2018. <>.

"Recognizing Employee Contributions." 03, 2018. Accessed 03, 2018.