Overview
HRM FPX 5310 Assessment 3 This analysis aims to assess the current reward and benefits package offered by Fleet, Farm, & Home (FFH). An effective reward program has various essential categories that are essential to recruit high-caliber applicants possessing the necessary capabilities and skills needed to perform the job responsibilities and realize the firm’s vision and goals. A robust total rewards package can potentially reduce employee turnover and resignations, enabling FFH to reap the benefits of a robust workforce. Employee reward and recognition is a major component of an effective benefits strategy that provides employees with fair reward relative to the competition in the market. Further, an effectively designed total rewards program has the ability to lengthen employee tenure, motivating dedicated and highly performing employees to remain with the company.
Generally, the rewards program will address a number of important determinants that yield a net-positive program that benefits employees as well as likely candidates, such as:
• Competitive salary and incentive pay rewards.
• Incentives that are not monetary.
• Provision of retirement benefits and insurance.
• Employee reward, holiday leave, and time-off programs.
HRM FPX 5310 Assessment 3 Total Rewards PackageHRM
It is worth noting that the most effective total rewards packages are not a single size that fits all. These packages can go a long way in influencing whether one takes up employment or maintains his/her stay with an organization. Though nice salary packages and incentives are crucial, they are not the sole factor for employees who require insurance cover for themselves and their dependents. Retirement schemes, such as stock and 401(k) schemes, are significant for the employees who desire a long-term career at FFH. Apart from this, companies that have accrued leave according to tenure, holiday leave, and employee appreciation programs ensure greater realization of effort invested by their staff.
Management and administration of such a total rewards package would be in the hands of the executive members of the human resources department. As FFH begins expanding further into the greater Midwest markets, we need to compare and look at their total rewards package to what their competitors have to offer. Potential candidates will not only look at the company prestige but also benefits, rewards, and opportunity upon hire. Total rewards is everything that employers can leverage to obtain a higher quality of candidates as well as retain current employees.
Market Comparison
A survey of current wages in the current market across the United States reveals that the Midwest offers some of the most common highest wages. In order to be competitive, FFH should put their compensation packages in the middle of current market prevailing wages for new sales reps. New sales reps’ first wage should be in the range of $55,000 annually. In addition to wages, incentives provided for selling and bonuses for high producers need to be taken into account.
HRM FPX 5310 Assessment 3 Making performance-based incentives on contracts signed and sold worth more than $5,000 would be a great starting point. Having a flat-rate incentive of $250 for every signed contract as the first reward would be a good concept. With increased performance, high-performing workers in the company could be offered commission bonuses according to their sales value, with a suggested rate of five percent (5%) on total sales over $10,000. This would be a good return to workers and keep FFH profitable.
Salary and Incentive Compensation
Non-Monetary Compensation
When designing a total rewards package, attention must be paid to existing family compositions of employees. Approximately 60% of families with children have two working parents, so parental leave and flexible scheduling benefits are essential. Offering parental leave, flexible scheduling, and prepaid college savings or dependent care savings plans options would attract higher-quality candidates to FFH.
Parental leave is also necessary in two-income households because emergent needs may come up that require employees to leave work early, report to work late, or take time off to fulfill family obligations. FFH must study their attendance and scheduling requirements to determine how flexibility can be built in on the part of employees who require it. While certain kinds of work require rigid schedules, salespersons, for example, can accomplish work at home when family obligations occur.
Parental Leave and Non-Monetary Compensation
It is necessary that Fleet, Farm, & Home (FFH) consider the specific situation of their workforce, particularly the parents, by implementing a policy that is friendly to their requirements. Another important facet of non-monetary rewards is providing access to in-house amenities, such as complimentary drinks (bottled water, coffee, etc.) and staff discount programs. Amenities can range from an in-shop gym for company employees, sanitation toilets, to free drink areas in break rooms. Offering about 5% discounts on store-priced FFH items can prove to be an essential perk with no significant cost addition to staff pay or entitlements. Luxuries offered gratis, along with minor perks of this nature, can make an immense difference towards employee satisfaction as well as portray the appreciation for their work that the company places.
Insurance and Retirement Benefits
Based on the 2020 United States Bureau of Labor Statistics National Compensation Survey, participation in a medical benefit plan is typical throughout the majority of industries with roughly 75% of workers who sign up upon being made available. FFH needs to have an overall coverage of medical, dental, and vision for both employees and dependents. Giving additional employer-funded coverage on a percentage basis will make them quality options for current and future workers. Private employers typically pay 70-85% of employee premiums and a lesser percentage for dependents. FFH has to provide insurance coverage for employees and dependents the same throughout the whole company to prevent discrimination.
Retirement plan options are also an important part of an effective total rewards program. FFH, being a private sector firm, needs to have a 401(k) or savings plan administrator that will allow employees to contribute part of their earnings, topped with company contribution. Providing a retirement benefit can lead to encouraging existing employees and prospective employees to make long-term career commitments with the firm. FFH should look into available competitive retirement plans in the market to determine plans with most rewarding returns to employees and yet remaining affordable to the employer.
Paid Time Off, Holidays, and Recognition
Total compensation statements enable employees to view their whole yearly pay package, direct and indirect compensation (SHRM, 2017). Employee incentives and benefits are included alongside compensation and insurance benefits. Total rewards programs enable employers to consider every worker based on productivity, tenure, and the personal time they require outside of the workplace. Employee value is not merely salary-dependent; employees appreciate the time and effort employers invest in them, which provides a good work environment and boosts engagement and morale. As businesses demonstrate that they appreciate the personal interests and time of employees, dedicated employees tend to remain dedicated.
Providing paid time off (PTO) accruals is a wonderful method for rewarding the employees for their dedication. Although rates of accrual will differ by business, common industry practice is providing eight to ten hours of PTO monthly for hours worked. This is for the benefit of employees who report to work every day to get time off as and when they need it for personal occasions. Firms whose employees accumulate excess PTO can implement a paid time buyback plan, under which employees sell back accumulated days at a given point in time in a year with the sanction of the executive. This practice would be especially beneficial at the close of the fiscal year or prior to the holiday season when most families are financially strapped.
HRM FPX 5310 Assessment 3 Total Rewards PackageHRM
In addition to individual time off, holiday pay for nationally observed holidays is significant. Acknowledging the significance of tradition and offering time off for holidays will likely be appealing to a strong employee base. Although certain holidays, such as Thanksgiving, occur during the most critical shopping times, FFH can still offer incentive to employees who work on those holidays in the form of additional leave time or differential pay rates. Although it will not be possible to close up shops completely for a holiday, granting current workers time off for future use or incentive pay to work can encourage additional workers to come in for holiday shifts.
Reward opportunities for employees can inspire workers to give extra effort and achieve personal satisfaction. Programs like “Employee of the Month” awards, company newsletters to recognize outstanding work, and regular departmental celebrations to honor departmental success offer non-monetary rewards that recognize employee effort. Recognizing top performers on a bulletin board in the store or in newsletters recognizing outstanding customer service, academic success, or promotions not only recognizes individual success but also shows that the company is interested in each member’s personal and professional development.
Legal Compliance
To legally comply with providing a comprehensive pay package, Fleet, Farm, & Home (FFH) need to assess and ensure their company complies with the law. Of potentially greatest importance of this assessment is the Fair Labor Standards Act (FLSA), which provides important rules regarding minimum wage, payment of overtime, maintaining records for hours, and employment of children (below age 18 years). FFH has to compensate employees with a minimum wage, which differs across states, requiring special care for the location of each branch. The standard workweek is forty (40) hours, and any work done over this amount has to be compensated in overtime. Defiance of these rules can have severe legal repercussions, such as fines, lawsuits, and even closure of business.
Apart from overtime and equal pay, the FLSA also safeguards youth workers. Children are prohibited from working over forty (40) hours a week and cannot work after 10 PM on school nights preceding school days. Another significant legal factor is the Age Discrimination in Employment Act of 1967 (ADEA), which safeguards individuals forty (40) and above against age discrimination in the majority of employment issues, such as hiring, promotion, compensation, and termination. Performance on the job must be the only reason for employment decisions, not age. The total compensation package analysis shall be free from discrimination as well, including consideration of disabled persons under the Americans with Disabilities Act (ADA) and persons receiving benefit under the Family Medical Leave Act (FMLA).
HRM FPX 5310 Assessment 3 Total Rewards PackageHRM
Equal employment practices must be maintained, providing equal access to promotion, benefits, and participation in incentive schemes within the organization. The overall rewards package should be available to all employees, both existing employees and prospective applicants. Under FMLA, the employees are eligible to take advantage of this benefit if they meet the minimum employment criteria of one (1) year of service and at least 1,250 working hours. The act aims at avoiding discrimination against employees suffering from medical conditions or caring for sick family members. Secondly, the Pregnancy Discrimination Act (PDA) forbids discriminating against pregnant workers in every aspect of employment, ranging from hiring and firing to equal pay, opportunities for promotion, training, and benefits. Misusing the total rewards package to discriminate against any worker is not acceptable at all.
Recommendation
Preparation of an effective total rewards package for FFH should start with reviewing existing policies, benefits, and liabilities in the company. The evaluation will give a general overview to include growth, required changes, and compliance with policy for legal purposes. After evaluation, FFH has to start on income and market salary alignment. Based on facts provided by the U.S. Department of Labor, FFH has to provide a competitive range of median wages per job, compliance with federal and local minimum wages, while adding the overall compensation package.
In regards to retirement and insurance benefits, FFH must have an excellent program that includes 80% coverage of insurance premiums for the employees, while the employees will contribute 20% of the monthly premium. Family and dependents must be covered at 65% coverage, with employees contributing 35%. This will improve employee retention and recruit possible candidates. FFH needs also to pursue a low administration charge retirement program together with favorable past performance return. A comparison ought to be conducted against top industry performers such as John Hancock and Nationwide. 3% of employee earnings yearly will be contributed to the retirement program by FFH while up to 6% of employees’ earnings is to be contributed by the employees.
In the bonuses and commissions categories, the company must have a standard bonus policy for every member of the sales team based on sales performance on a quarterly basis, and an incentive policy for top performers in sales on a percentage earnings basis. Holiday pay and paid leave time must be provided equally throughout the company, and all workers who work at least 100 hours a month must be able to accrue 8 hours of non-forfeitable leave time.
Leave Time and Employee Recognition
Fleet, Farm, & Home (FFH) leave time policy provides workers with the opportunity to take paid personal time or vacation when necessary, including those covered under the provisions of the Family and Medical Leave Act (FMLA). Employees are given an equal chance to bank one day off each month, in addition to any holiday time for the month. Those staff members with 80 hours or more of leave accrued will be permitted to sell up to 40 hours of that time in October of each fiscal year, at their current rate of pay per hour.
In order to promote greater employee morale, FFH will honor outstanding performers every month with an “Employee of the Month” award. The reward will be accompanied by a company newsletter with customer compliments, management suggestion for recognition, and notable milestones in employees’ work and personal history. With the total rewards package, FFH will be on par with other competing firms. The package is not merely about financial rewards but also meets the personal needs of employees and provides a pleasant working environment with good morale and development opportunities.
Commitment to Diversity and Inclusion
The recommendations presented here in this comprehensive package of incentives encourage a diverse workforce with the necessity of equal incentives and benefits in terms of work output and work-related aspects. Notably, no aspect of this plan will favor or discriminate against any protected class. None of the policies or benefits shall be sex-, race-, gender orientation-, age-, disability-, or medical condition-based. There has to be uniform and transparent guidelines that do not discriminate against any factor on the basis of specific conditions.
References
Bureau of Labor Statistics. (n.d.). Databases, tables and calculators by subject. Retrieved from https://www.bls.gov/data/#employment
Pregnancy Discrimination Act. (n.d.). Retrieved from https://www.eeoc.gov/pregnancydiscrimination#:~:text=The%20 Pregnancy%20 Discrimination%20Act%20(PDA,term%20or%20condition%20of%20employment.
U.S. Department of Labor. (2019). Family and Medical Leave Act | U.S. Department of Labor. Retrieved from https://www.dol.gov/agencies/whd/fmla
U.S. Department of Labor, Employment and Training Administration. (n.d.). O*Net online. Retrieved from https://www.onetonline.org/
HRM FPX 5310 Assessment 3 Total Rewards PackageHRM
What is included in a total compensation statement? (2017). SHRM. Retrieved from https://www.shrm.org/resourcesandtools/tools-and-samples/hrqa/pages/totalcompensationstatement.aspx
