Introduction
As the new head of human resources at Java Corp, a homegrown cold coffee and tea business, a qualified individual needs to fill the executive director role in the soon-to-open office in London, England. This will be a two-year assignment, and there is a need to plan for a preliminary compensation package for this role. This paper aims to create a primary compensation package for this new position as an HR manager discussing the new position’s pay or salary and benefits.
Pay or Salary
All the money and other perks employees receive for their hard work are collectively called “compensation.” Hourly pay, a salary, commissions, bonuses, stock options, and other perks are all possible forms of compensation (Mabaso & Dlamini, 2021). Several components can go into determining an employee’s total salary. A worker’s compensation package includes their base pay, any raises they may be eligible for, and any other perks they may earn due to their employment (Mabaso & Dlamini, 2021). The term “compensation package” describes the total monetary and non-monetary benefits your employer provides in exchange for your services. Salaries often differ depending on the company (Mabaso & Dlamini, 2021). While they all include base pay, the specifics of the benefits package are generally negotiated between the employee, the firm, and the position. Some companies provide generous benefits packages and pay their employees well; others do neither.
Employee starting rate of pay, which is known as base pay or base salary, will be determined when the employee begins working for the company. Base pay can be expressed as annual compensation, monthly income, or hourly rate (Grigsby et al., 2021). If a candidate meets Java Corp’s requirements for an executive-level post, they will get an annual salary in exchange for their services. When calculating the salary for an expatriate position, the education level, the work experience of the candidate, and the number of innovative ideas that an individual may contribute are all essential criteria. Additional benefits, such as short-term incentives, supplemental benefits, long-term incentives, perquisites, and benefits, are frequently provided to executive-level employees in addition to the standard benefits package (Grigsby et al., 2021). In some cases, the firm will even foot the bill for perks such as the retirement plan, insurance, and vacation time.
Employers should consider the following organizational aspects when choosing the proper compensation approach for their employees; the purpose and vision of the corporation, the strategy and business plan of the corporation, and the corporation’s expectations of the specific function (Grigsby et al., 2021). Elements that make up an executive remuneration plan are subject to its unique accounting, tax, and regulatory considerations. It is necessary to have a strategy for implementing these components by Java Corporation. Each of these considerations must be carefully considered when designing a complete compensation strategy (Llorens, 2021). The cost of living in the area and the general trend of compensation in the regional labor or local market substantially impact the starting salary for various occupations.
Benefits for Employees
An employee’s benefits package is an integral aspect of their total remuneration package when on an international assignment. The proper ones can significantly impact the success of the global deployment. Still, many companies struggle to balance employee expectations and escalating costs fairly. It is imperative that, as part of their total compensation, employees and their families always have the option to purchase health insurance for themselves and their families (Llorens, 2021). A comprehensive health plan should always include coverage for medical, dental, and vision care, in addition to disability insurance, both temporary and permanent (Llorens, 2021). Because Java Corporation is looking to fill a position in London, England, the HR staff responsible for developing the benefits package should consider the healthcare option carefully.
The most common methods of providing incentive compensation to executive staff are annual incentives and bonuses. Depending on the business, bonuses can either be a predetermined sum of money or a percentage of the company’s total sales or profits (Mabaso & Dlamini, 2021). One such perk included in the compensation packages of many executives is long-term incentive schemes. Long-term incentives often have performance assessment periods that last for several years and are generally presented to high-performing leaders who have had a favorable impact on the firm’s overall success (Mabaso & Dlamini, 2021). Providing these workers with the opportunity to buy company shares at a predetermined price is one of the most prevalent forms of long-term motivation companies offer to their workers.
A common component of CEO compensation is “perquisites,” a catch-all term for a wide range of indirect payment kinds or non-monetary incentives. Employers have been rewarding their staff members with such benefits for several years to improve their workforce’s productivity (Mabaso & Dlamini, 2021). This area includes benefits the employer provides, such as educational reimbursement, paid accommodation, paid meals, and transportation (Mabaso & Dlamini, 2021). Health and welfare benefits are two examples of supplementary benefits that are often covered by an employer’s financial contribution. Some examples of this type of insurance include insurance for long-term care, supplemental life insurance, and even split-dollar life insurance.
In addition to providing a relocation incentive, Java Corporation ought to do so because the position in question is located overseas. Java Corporation must pay for any expenses associated with the employee’s relocation to London, England. These expenses include shipping, commission on the sale of the employee’s current home, the cost of a real estate agent to assist the employee in finding a new place to live, and any expenses associated with finding temporary lodgings (Greer, 2021). Include a schedule inside the plan to help the employee acclimatize to their new surroundings and give them time to do so.
Another contentious issue for overseas staff is pensions, and again, experience suggests that a cookie-cutter approach is less than optimal. Several factors must be considered when deciding how best to provide retirement benefits to expatriates (Greer, 2021). These factors include the compensation requirements and regulations of both the expat’s home and host country and any tax or social security treaties between the countries (Llorens, 2021). While the international plan might be helpful in some situations, the best organizations for managing expatriates’ benefits use process maps to help ensure that each expatriate receives the care they need (Llorens, 2021). Sticking to the procedure ensures uniformity for workers while remaining open to utilizing a home, host, or worldwide method allows for the adaptability required to account for various circumstances.
Conclusion
Java Corporation will have the necessary platform to select the ideal applicant to fill this position if it adheres to this strategy for creating a highly esteemed remuneration package for an executive role for Java Corporation in London, England. Everything within the box will entice an exceptional applicant who will be the perfect fit for the company’s goals. This candidate will have the same objectives as the company and be driven to create success for themselves and the company.
References
Greer, C. R. (2021). Strategic human resource management. Pearson Custom Publishing.
Grigsby, John, Erik Hurst, and Ahu Yildirmaz. “Aggregate nominal wage adjustments: New evidence from administrative payroll data.” American Economic Review 111.2 (2021): 428-71.
Llorens, J. J. (2021). Compensation and benefits. In Research Handbook on HRM in the Public Sector (pp. 105-118). Edward Elgar Publishing.
Mabaso, C. M., & Dlamini, B. I. (2021). Recent study on the impact of compensation and benefits on job satisfaction. Insights into Economics and Management, 7, 55-68.