Human Resource Essay Example | Topics and Well Written Essays - 2000 words

Human Resource - Essay Example Employees who aspire for status will work hard towards getting the company car and this will be very beneficial for the organization. This paper will comprehensively analyze whether a company should add direct compensation or not when employees undervalue the cost of benefits. â€Å"Employee benefits typically refers to retirement plans, health life insurance, life insurance, disability insurance, vacation, employee stock ownership plans, etc. Benefits are increasingly expensive for businesses to provide to employees, so the range and options of benefits are changing rapidly to include, for example, flexible benefit plans.† (Direct and Indirect Compensation) Maternity leave, vacation pay and holiday pay are some of the best examples of benefits, there are two types of benefits namely tangible benefits and intangible benefits, the above examples are all tangible benefits, some of the intangible benefits include appreciation, working in a good working environment, likelihood of promotion and so on. Employees crave for fringe benefits, fringe benefits mainly refer to tangible benefits, tangible benefits are generally believed to be better than intangible benefits. ... Variable pay mainly depends on the performance of an employee in his role, when an employee performs well, he is rewarded with incentive pay and bonus pay come the end of the year, and this is a fine example of variable pay. Benefits play a pivotal role in retaining employees; benefits can also increase the job satisfaction amongst employees. Employees start working harder in order to get these benefits that an organization offers, this increases the overall productivity of the organization and the goals are easily achieved. â€Å"Employee benefits are an important part of any company’s offering to their prospective or existing staff. There can be numerous advantages to establishing an employee benefits scheme, not only for the employee, who can receive useful non-cash benefits in addition to, or in place of, part of their salary, but also for employers, who can bulk out their salary offering with additional benefits to their staff.† (Advantages of Benefits) Direct and Indirect Compensation It is very important to understand the difference between direct and indirect compensation, many employees fail to value indirect compensation and as a result of which quit an organization. Direct compensation is the salary or the wages given to the employees, indirect compensation refers to the non-monetary benefits provided to the employees, facilities like hospitalization, overtime policy and so on fall under non-monetary benefits. Here is a diagram which would throw more light upon the same. Indirect-Compensation (2011) â€Å"Today the compensation systems are designed aligned to the business goals and strategies. The employees are expected to work and take their own decisions. Authority is being delegated. Employees