Compensation and Benefits Plan for SMC – Business Research Paper(300 Level Course)
SMC is a locally owned and operated company that currently employees 89 employees. Due to a shrinking labor market and increasing turnover within the SMC Company, I have decided to propose a comprehensive, progressive compensation and benefits plan in hopes of decreasing the amount of turnover and increasing the stability of the work force.
A recent Ernst & Young survey calculated that the cost of replacing a high-level employee may be as much as 150 percent of that departing employee’s salary. Obviously cost is also factor in deciding what benefits we can offer our employees. There are a host of free and low-cost benefits we can offer that will greatly increase job satisfaction among our work force while costing SMC little to no money.
The first option is negotiating special discounts for employees at local stores and restaurants. Hotels, service providers and amusement parks are usually willing to give discounts to team members as long as a small amount of advertising is provided by the company in areas such as break rooms and company memos. Another fantastic idea is to offer free seminars at lunch for employees who would like to attend. Health-care workers, financial planners, safety experts, attorneys and other professionals will often offer their speaking services at no charge. Education is beneficial for both your employees and our business.
We can offer a credit union membership. One of the most appreciated, but most overlooked, benefits is membership in a credit union. There are some 6,000 well-established, state-chartered credit unions throughout the United States and Canada that accept start-up businesses as members at no charge. The benefits to our employees are threefold: most likely they’ll increase their savings rates (especially if you offer automatic payroll deduction), have access to lower loan rates, and pay lower fees–if any–for services.
One last free option we should instate is to offer supplemental health insurance that is paid for by the employees through payroll deductions. Many health care providers will offer discounts for employees who are subjected to this type of health insurance plan. This way, it does not cost SMC any money, and it gives a discount to our employees for personal and family coverage. A good insurance plan for employees will decrease sick days for employees and dramatically increase workers satisfaction.
As stated above, cost was a major factor in coming up with an effective benefits package for our employees. All the above options proposed will not cost SMC any money whatsoever. It is proposed that with these implements employee job satisfaction will increase up to 20% which should increase our bargaining power in hiring new team members as well as decrease turnover of our current team members.