Fair and Equitable Compensation

1063 Words5 Pages
Fair and equitable compensation would have to first be based on an organization’s strategic plans and resources. For compensation to be fair and equitable, employees would have pay and benefits that do not give bias to one employee over another. In an organization, pay and benefits should be relative to the job responsibilities of a given position and then based on employee performance within a given level of responsibility. The president of a company or organization definitely has much more responsibility, associated job duties, and therefore higher levels of stress than other employees. Because of this, the president of an organization should be at the top level of a pay structure scale. Below the top person in an organization there should be various levels to a pay structure. Gathering job descriptions, requirements for each position, and an importance rating of each position will help to develop an organized and fair pay structure. Once a pay structure is developed and put into place, employees within a given pay structure should be paid at a relatively similar rate. Employee knowledge, experience, education, and performance would be reasons for differences in pay within a pay structure level. Someone who has more knowledge and experience should make more than someone who is just starting in a given job or career. In determining raises and other compensation, merit pay systems seem to be fairer than seniority pay systems. The text states that seniority pay and longevity pay systems reward employees with periodic additions to base pay according to employees’ length of service in performing their jobs. In my experience at working for an organization that uses seniority pay, there is not a lot of motivation to work harder than anyone else. If an employee is hired with a group of ten other people, all of them would receive the same raise at set timed intervals.
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