Total Rewards System Proposal
May 12, 2018
Efforts to construct a total rewards system for any given company is complicated. Total rewards are thought of as comprehensive compensation packages that include both monetary and non-monetary (UNC Executive Development, 2015). This total rewards program is offered by employers in an effort to provide employees with something to look forward to as a reward for the dedication for their time, talents, efforts, and results (UNC Executive Development, 2015). Many people give up their lives trying to earn a honest living and these rewards programs offer the incentive and security. Elements of total rewards programs include access to health care services that include medical, prescription, dental and vision coverage (UNC Executive Development, 2015). There are also wellness offerings that can come in the form of assessment and screenings that help get ahead of any illness or life altering incidences that may arise (UNC Executive Development, 2015).
Security comes in the form of retirement benefits such as pensions, 401(k)s, retiree medical and life insurance (UNC Executive Development, 2015). These total rewards programs even acknowledge the fact that people have lives outside of work (UNC Executive Development, 2015). Taking this into consideration there are work-life programs like paid and unpaid time off for reasons that include maternity leave and bereavement (UNC Executive Development, 2015).
Considering a company like Google, the issues that arose that made the implementation of a total rewards program necessary was that there were issues within the IT industry that ensured that confidentiality and loyalty were in question (Sherif, 2016). Employees that would be deemed highly talented have proven to require more incentives to keep them coming or better yet make them stay (Sherif, 2016). The resolution was believed to be the implementation of a total rewards program that encompasses employee recognition that motivates, satisfies and ultimately increases productivity while improving organizational performance (Sherif, 2016).
These total rewards programs also offer dependent care, short-term and long-term disability whether it is a work based injury or otherwise, and schedules that can be catered to the individual’s specific needs (UNC Executive Development, 2015). Along with these incentives that add to the value of any given total rewards program, there are also the offering of base salary, bonus, stock options, variable pay, executive salary, and perks like company cars (UNC Executive Development, 2015).
The idea of implementing a total rewards program for a life IT profit organization that employs 20,000 employees in 17 different countries and possesses 2,000 management-level individuals who speak a variety of languages proves to be a bit of an undertaking but in the careful analysis of total rewards programs for other companies, there is so much that can be utilized to develop a total rewards program that will have people clamoring to be employed with this company. A total rewards system can only operate if there are several components met.
The total rewards programs being designed will encompass requirements per management-level, in an effort to develop a system that caters to seniority and a work-progress based compensation. For this particular total rewards system an employee must have survived the 90 day probation period and remain productive and in good standing with all management staff. Companies like Google, an IT company that thrives on results, must constantly ensure that morale is high (Kleinart, 2014). In an effort to increase productivity without completely dangling a carrot, employees need something more than just earning an hourly rate (Kleinart, 2014).
Goals are set each quarter of every year (Kleinart, 2014). Goals must be met on all levels, especially below management level (Kleinart, 2014). The goal break down per organization would vary but in the spirit of companies like Google, there would be company wide goals that would need to be met but would vary depending (Kleinart, 2014). Personal goals amongst the individual employees are typically developed based on the goals that need to be met within the company (Kleinart, 2014). This is why the total rewards program works to the advantage of a particular employer-employee relationship.
The best way to understand this would be to consider a give and take relationship. For the completion of or the meeting of a particular goal, an employee stands to gain in most cased commission or a certain amount of paid time off. For example, an employee may be saving for a house, the quarter goal may be $500,000. In meeting this quota, an employee may receive a 25% commission that could ultimately serve as the downpayment they may need.
Quota based requirements come second to standard incentives as a result of being hired in general. For those that are hired, they are automatically given shares and stake in a 401(k) or Roth IRA, granted they get past their 90 day probation period. Other requirements may include progression to certain employment levels. Higher-level management positions could include everything from extended paid-time off to standard schedules crafted tot heir particular preference be it necessity or not.
This total rewards system would encompass some of the basic fundamentals of any given compensation programs. These components includes a base salary would include short-term or long-term incentive pay (Sharp, 2018). Which should be standard but isn’t technically offered by every organization. This gives employees the necessary boost that brings them to work each morning (Sharp, 2018).
Benefits that ensure long-term security are another vital component of the said total rewards program (Sharp, 2018). As mentioned before 401k programs and other incentives like paid leave for sick and bereavement leave as well as vacation time (Sharp, 2018). Certain levels would be offered more extensive incentives but this is still a necessary aspect of ensuring employees are enamored by both the long term and short term benefits.
Health access is a very necessary component of a total rewards program. These benefits include legally-mandated minimum requirements such as Medicare, unemployment, and Social Security. A sense of security regarding their health is important to any given employee (Sharp, 2018). The ideal is that the total rewards program being formulated will yield a demand for those that actually want to participate in employment with this company. The total rewards system needs to be deemed an attractive benefits package (Sharp, 2018). This idea is that the rewards package would ultimately aid in setting a particular company apart from competitors, this company specifically (Sharp, 2018).
Development is an important component within any particular company (Sharp, 2018). Many employees come into a job not looking at it as if this is where they’ll be twenty years from their start date. For some they have their sights set on evolution personally and occupationally. A total rewards program that will ensure that employees are provided with resources that will ultimately take them to the next level is a great carrot to dangle in front of employees. The fact that the company even believes enough in its employees is certifiably crucial to the interest of an ambitious employee.
As it pertains to these development opportunities, studies have shown that a lack in opportunities in which an employee can take in information in an effort to develop will ultimately result in disillusion with ones work (Sharp, 2018). Offering development opportunities that incite growth with ensure that employees don’t jump ship (Sharp, 2018). Tailoring these opportunities to their individual goals for growth gives an employee something to work towards and also makes them feel as though they are being both heard but also valued (Sharp, 2018).
When this is the overall feeling amongst the employees as a collective, productivity will increase and quotas will be met. This is one of the most important reasons why employees will have the opportunity to attend a a graduate or undergraduate program on the companies dime, granted they can meet or top quotas for 8 quarters consecutively. This is valuable because the act of providing employees with these resources ensures that employees want to stay and grow (Sharp, 2018). The mission of a total rewards program is maintain employee retention (Sharp, 2018).
The total rewards program being offered would include For those that are hired, they are automatically given shares and stake in a 401(k) or Roth IRA, granted they get past their 90 day probation period. Other requirements may include progression to certain employment levels. Higher-level management positions could include everything from extended paid-time off to standard schedules crafted tot heir particular preference be it necessity or not. Employees will have the opportunity to attend a a graduate or undergraduate program on the companies dime, granted they can meet or top quotas for 8 quarters consecutively. As an afterthought, there would still be a base salary that would include short-term or long-term incentive pay as well as commissions and bonuses contingent on a particular employees productivity rate.
These various benefits pose significant advantages for employees on all levels. These incentives offer convenience, consideration, security and financial gain that is promising on so many levels (Sherif, 2016). Standard base pay is no longer an incentive when Google offers pay-for-performance incentives (Sherif, 2016). This formula focuses on offered employees rewards for their consistently strong performances (Sherif, 2016). This includes training that will assist in transgressing any weaknesses amongst employees that would be considered underperforms (Sherif, 2016). As a result employees generate more than $1 million in revenue per year (Sherif, 2016).
Within this specifically curated total rewards program the paid leave incentives are beneficial to the employee that gives their all to meet quotas. These employees need to be able to take time for themselves and their families without worrying out absence will affect their financial standing.
An employer must make the information within a perfectly curated total rewards program must be simple and digestible (Bisk, 2018). This is due to the fact that certain information could be overwhelming because the employee may not be able to understand (Bisk, 2018). An employee not being able to understand the total rewards program would mean they probably don’t understand the value of the particular rewards system (Bisk, 2018).
In an effort to devise a useful competitive pay structure, it is important to focus on a market-based pay structure (Bisk, 2018). This is due to the fact that IT falls under the realm of tech (Bisk, 2018). Incorporating a competitive pay structure ensures that no one feels entitled based on skillset (Bisk, 2018). They must first complete various benchmarks that affirm the they are worthy of any said compensation (Bisk, 2018). Competitive pay isn’t for the weak of heart however, in some instance it could lead to an increase in turnover rates, which is counter productive to employee retention (Bisk, 2018).
Bisk. (2018). Developing a Competitive Pay Practice in Your Organization.
Retrieved from https://www.villanovau.com/resources/hr/developing-competitive- pay-practices/#.WvkFOi_Myu4
Kleinart, S. (2014). What sort of rewards & recognitions does Google offer to their
employees? How do you earn them? – Quora. Retrieved from
Sharp, B. (2018). What Are the Components of a Total Rewards System? Retrieved
Sherif, A. (2016, March 4). Google rewarding programmes.
Retrieved from https://www.slideshare.net/AmrSherif4/google-rewarding-programmesc
UNC Executive Development (2015). "Does Your Organization Have a Total Rewards
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