Total Rewards System Proposal

Total Rewards System Proposal

HRM / 533 (Similarity is 12%)

August 10, 2015

Total Rewards System Proposal

As the newly appointed director of the Human Resource department at Company A Insurance Group, the writer of this paper has been given the task of developing a Total Rewards system. Company A Insurance Group is a profit based organization that employs 20,000 employees in 17 different countries worldwide. Company A Insurance Group believes in hiring a diverse group of people and will strive to create a culture that is inclusive to all of its employees. While many companies only focus on what will be the base pay, vacation and sick time for the position, it is important that Company A offer a strong total rewards program to attract, motivate, retain, and engage all employees. A complete total rewards system will address a number of issues that will align the business goals of the company along with the interest of its employees. The goal of a successful total rewards system will be used to attract and keep a good employee, and to promote a healthy work environment at Company A.

Create a brief overview of the company requirements for a total rewards system.

Company A’s view of a total rewards system will encompass six (6) elements to ensure that the organization attracts, motivate, engage, and retain its employees. These six (6) elements give prospective employees an incentive to want to join our organization, want to perform at a high level, seek how to elevate within the company, and remain with Company A though out their career. The six (6) elements are:

1. Compensation – When an employee render its services (i.e., time, effort, skill) they are paid either fixed or variable pay according to their performance.
2. Benefits – In order to provide security for its employees and their families, an organization will supplement cash with programs such as health insurance, income protection insurance, savings and retirement programs etc.
3. Work-Life Effectiveness – Programs, policies, and practices developed by an organization to enhance the quality of success to its employees at work and home. This achieved though one of seven categories that include; caring for dependents, health and wellness, workplace flexibility, financial support for economic security, paid and unpaid time off, community involvement, transforming organizational culture.
4. Recognition – When employees achieve a certain amount of success or reach a milestone, formal or informal rewards are given to acknowledge and give special attention to the employee. This will in turn support the organization business goal by encouraging desired behaviors of all employees.
5. Performance Management – Susan M. Heathfield, an expert in Human Resources explains performance management as the process of creating a work environment or setting in which people are enabled to perform to the best of their abilities. Performance management is a whole work system that begins when a job is defined as needed. It ends when an employee leaves your organization (Heathfield, 2015 Pg.1, Para.1)
6. Talent Development – Tools are provided to employees in order for them to reach their fullest potential to advance their skills and competencies.

Company A will also incorporate a total rewards strategy that will define the needs of the organization and help to create a cultural image in the work environment. The total rewards strategy will first create the context of the total rewards philosophy. An example would be set goals like:

• Attract and retain the best talent
• Support the organization’s culture to innovate and perform
• Align all interests of stakeholders

The second task would be to develop a statement of philosophy that connects the core mission, strategy and values of the organization to the rewards programs and practices that influence what people do (Wilson, 2014 pg 3).

Finally, the third task would be to define the purpose of each reward program. When defining each reward the questions should be answered:

• Why does this program exist?
• How is it meaningful to the employees?
• How does it create a competitive edge for the organization?

According to Hein and Kwon (2013) total rewards are anything and everything an employee receives and recognizes as valuable or rewarding (Hein, 2013 p.40). By considering all the possible elements of a total rewards program, Company A will provide mixture of compensation opportunities that are tailored to their needs of its employees both professionally and personally.

Formulate a total rewards strategy to encompass the fundamentals of compensation and the regulatory environments.

There are many International, Federal, State, and local laws that govern and impact compensation and employment. On the International level, there is International Labor Organization (ILO) that is governed by the United Nations. This Organization oversees issues regarding child labor, discrimination, and collective bargaining agreements. In the United States there are many laws and acts that formulate labor practices on the homeland. The most popular laws are the Americans with Disabilities Act (ADA), Fair Labor Standards Act (FLSA), Minimum Wage, Overtime Pay, and Unemployment Laws. Each State and local governments have their own employment laws for employers who do not do business over State lines or internationally.

Company A Insurance Group will seek to comply with all regulatory environments related to the company’s business practice. It is important that Company A maintains to be ethical within the United States and abroad. The total reward strategy will encompass the concepts of all applied laws and will demonstrate the company’s wiliness to be a leader in global human rights issues. Because compensation programs must adhere to specific laws designed to provide fairness in how employees are paid, the compensation system of the company must sticks to laws and make sure all of the regularities of the laws are followed well by the company (Worldatwork, 2007).

Explain the advantages of the total rewards strategy you are proposing and how it might satisfy the employees’ needs.

When properly designed, a total rewards strategy can provide an incentive for talented people to join a company, to perform at levels that produce business results, and to remain with the company as long as they continue to produce.

In short, total rewards can give you a competitive advantage by helping to link worksite employee behavior with business goals and by creating an engaged and productive workforce (Kantor and Hein, 2012). Company A’s number one goal is to make sure that it remains a desired place for employment by being a leader in innovation of each of the six (6) elements discussed earlier by: