Building an Effective Incentive Plan

Nowadays, companies definitely understand that a big part of their employees’ remuneration should be based on performance. Given such, building an incentive plan should consider the fact that everything should be performance based. The construction of any rewards program within a company should carefully consider that highest quality employees are retained, engage employees in the organization’s overall success and reward them according to how they have performed. 

All of these can be considered as objectives that should be looked into in drafting incentive compensation plans examples. These pay plans should assist to inspire workers by encouraging them to enhance performance and at the same time understanding the value of rewards, thus resulting to the increase of their chance to stay within the company.

To know more about incentive compensation plans examples, read more below. It is good to note that in designing incentive pay plans, aligning the company’s goal is given great significance, so that not only do employees get the most out of it, but they also realize the value they put towards the company’s overall success.

Incentive Compensation Plans Examples: What you need to know

• Production Pay

Paying workers by the no. of hours is not usually the best option given to any company. Sometimes there may be instances wherein there are no pending tasks to be done, however if paying employees using piece rate basis is more aligned to the goal of getting them to perform more and do better. This can also be modified to become a bonus opportunity especially by adding a little bit to the hourly rate just to ensure that the quality is not compromised.

• Commissions

Another incentive compensation plans example is commissions. Most industries use such to earn a percentage of every sale especially for those working under the sales industry including real estate, car selling etc. There may be variations in the details of commissions depending on a number of factors and the division of percentage points. Definitely, if you are working on such kind of incentive pay plan, it is good to look into a straight commission basis receiving pay from sales or having a fixed salary plus a percentage for every sale. 

 

• Merit Incentive Plans

This type of incentive pay plan is usually in connection with the performance review of an employee a year. For instance supervisors may gauge their employees’ performance and give them ratings. In a scale of 1-5, given that 5 is the best score, those employees who consistently get such rating can get an additional bonus or even a raise.Finally, in drafting any incentive compensation plans it is highly recommended that it should be put in writing to avoid ambiguous terms that could be subject to dispute at a later date. The plans should also provide the company with broad flexibility.

For more information:

http://www.incentives-solutions.com/services/design-of-compensation-plans/

Workers Compensation Management Basics

Workers compensation management is a significant issue for businesses large and small, especially in today’s economy.  Knowing the policy basics and how it works can make a big difference in how you handle a situation at your company.  While the policy does differ state by state, some basic principles do apply.  Here are some simple commonalities across states that will help you understand the rudimentary concepts of workers compensation.

Any companies’ workers compensation policy requires input from both management and staff.  The basis of workers compensation management is that of a no fault system.  Under workers compensation policy, employers aren’t able to defend the company against employees in certain ways while employees aren’t able to sue their employers under those laws.  Since it is a no fault system, employers can ensure their workers are covered and speed up the claim process.  The reasoning behind this is that by providing a distinct and separate process that prevents lawsuits, the actual cost to provide the workers comp benefits stays low enough to allow employers to provide it to all staff.

In general, workers compensation management insurance will likely cover any medical treatment to an employee injured in an on the job accident, the liability incurred by an employer in the event where damage occurs to a third party, any occupational illnesses such as exposure to disease or pathogens, temporary disability payments, permanent impairment compensation, complete disability payment and even death benefits to surviving dependents.  While the laws do change state by state, the above are the most commonly seen elements of a workers comp program.

Workers compensation insurance is exclusively paid for by the employer and is required by state law.  While this may seem slanted in favor of employees, workers comp is truly to the benefit of management as well as employees.  Having the insurance is really the guarantee that the company cannot be sued by the employee for the injuries in most cases.

There are some workplace accidents and injuries that are not automatically covered by workers compensation insurance and may leave employees liable for their injuries as well as difficulty with their employer.  In general, this includes injuries that occur off the job, any self- inflicted injuries, injuries involving drugs or alcohol, injuries incurred while the employee was in violation of company policy, injuries that occur after an employee is laid off or separated from the company, and any injuries that are inflicted by a fight started by the employee.  In addition, any injuries that occur during the commission of a felony even while on work time are not covered by workers comp.

To learn more about workers compensation management, be sure to look up the details of your state’s law to see what is and is not covered by workers compensation insurance.

For more information:

http://www.incentives-solutions.com/solutions-2/employees-performance/