How a Pay Model helps Human Resource Professionals
A pay model is a beneficial tool for Human Resource Professionals when designing a Compensation System. A pay model breaks down the different options for an appropriate compensation system for that specific company. This includes strategic policies that help form the system's foundation, techniques that would make up for those same policies, and how it all links to their main strategic objectives. The pay model helps Human Resource Professionals lay out their options into four policy choices. The first one is Internal Alignment, which compares job and skill levels within the company, keeping fair to all employees. The second is External Competitiveness, when the company reaches pay to what its competitors are paying their employees. The third is Employee Contribution, where employees are paid based on performance. Lastly, s Management, where employees are paid based on their achievements to specific objectives. This helps Human Resource Professionals clearly understand which Compensation System is suitable for their company. An example would or a company whose objective is customer satisfaction. If this is the case, a company may want to use incentive programs by using merit pay and performance reviews to increase employee contributions, thus increasing customer satisfaction.
What Pay Systems can do for companies and employees
Depending on the payment system used, it can benefit an organization and its employees. Depending on the compan...