Background Information
For this assignment, the Case under review is a Sole Proprietorship Family Business Organization founded in 2001. The business is a large corporation operating in the Dry cleaning sector. The company has its decision makers as the owners and managers with an established Human Resource Department that is tasked with the responsibility of taking care of employees who are hired for pay depending on the amount of work they render to the company and according to the employment laws. The business organization is currently at the Maturity stage. The business is dedicated to thriving in its business environment by providing high-quality services to its clients and business partners. The organization has adopted a flat organizational structure consisting of owners, managers, and non-manager employees. Its mission is to ensure that its customers receive professional, friendly, courteous and prompt service. It also aims at maintaining a friendly and professional environment for its staff members by ensuring that they are treated with dignity and respect that they deserve in their work environment. The Business aims at becoming a leading provider of cleaning products and services to large and small businesses. The SWOT Analysis indicates that it has strengths in that it has loyal customers and positive cash flow. Its weaknesses are that it has adopted an expansive advertising plan. Its opportunities are that it there is a strong indication of good general economic outlook that is likely to improve in the long run. While its threats are that there is an expected increase in compensation for tenured employees. This paper will develop a staff and compensation plan for this business.
Staff and Compensation Plan
The staff and compensation plan has the purpose of ensuring that the Business schedules its work in a manner that enables employees to work under the required legal standards and that that they do not work excessive working hours that are beyond the normal working hours that are stated in employee’s job description. These descriptions of the job are also in line with legal job descriptions, policies, and procedures. This staff and compensation plan is meant to ensure that there is external and internal equity in the business through job analysis which thoroughly analyzes as well as describes each job position in the organization, job evaluation that determines a job’s worth on absolute basis as well as relative to other organizations, job pricing which establishes the compensation ranges so that companies gain maximum value for their labor grade and pay structures that ensures that there is standardized compensation practices within the organization by setting up pay structures that grade employees in grades and salary grading based on these grades including promotion and decrements.
General guidelines
In this organization, individual employee compensation plan is established cognizant of the maximum and minimum appropriate salary range. This is only exempted in a situation where the employee was previously earning higher salary range before the adoption of this compensation pay plan. The changes to the compensation plan in the company that is granted by the owners and the management team are only effective at the beginning of the next financial year. Salary ranges in the company will be reviewed every five years so as to ensure that they are generally consistent with market ranges. To this regard, the salary range increases in the company will be 1.5-2 % lower than the general pay increase.
Hiring process and rates
The Human Resource department will determine the hiring criteria in their organization and which is based on education and technical qualifications, job-related experience, applicant’s job and salary history as well as compensation rates of other employees who are performing similar jobs. The Hiring process must be deemed fair and inclusive of all qualified candidates. No applicants must be disqualified on the basis of their religion, ethnicity, or political affiliation. The hiring process only occurs anytime there is an available position in the business.
Job Classifying
The Human Resource department has the purpose and authority to collect job information, recommend salary range assignments and evaluate jobs with the purpose of classification. The final decision on job classifications lies with the senior manager. When new positions in the organization arise, a well-written job description is used to classify the job according to the pay system before the job is opened and posted. The Human Resource department is tasked with the responsibility of establishing salary range classification of any new position in the organization based on job qualifications as well as the required skills, job responsibilities and duties defined by the organization, job market value and compensable factors that are utilized in job evaluation system. All job positions in the organization have descriptions, assigned pay structure as well as a salary range. In the organization, reclassification of positions may be as a result of the review of the organizational jobs so as to appropriately place them in a new organizational compensation structure. Reclassification occurs when the organizational departments are being reorganized thus shifting positional duties, where significant and sustained changes have occurred in the position, and when the organization is unable to find a suitable candidate to fill the position due to its current classification. An employee who is in a position scheduled to be reclassified is automatically placed in the reclassified position so long as he has 50% of responsibilities and skills required in the new position. However, if the employee lacks the required skills and experience he or she is posted to a new job and a new candidate recruited to fill the reclassified job. Pay rate reviews are carried in accordance with guidelines based on lateral job changes, promotional increases as well as movements to lower salary range.
Standard Working Hours
The standard working hours for all professional employees in the organization is 40 hours every week. The hours and schedules for the managers and non-manager employees are determined by the owners. An employee works from 8.00AM to 5.00PM typically, with an hour lunch break every day. Any extended amount of time that exceeds the regular work standard hours is considered as overtime, and the employee will be compensated for the overtime at 1.5 times the standard regular hourly pay. In addition, overtime hours must be agreed between the managers and non-manager employees prior to work performance in the extra hours. At any given week, the employee cannot accrue more than 20 hours of extra working hours as hours above the standard 20 extra hours will not be compensated.
Compensation and Pay Rate
The Business pay rates are generally determined according to the guidelines from the National and district legal requirements. The Company maintains separate pay rate guidelines according to employee statuses such as full-time employees, part-time employees and the job position of employees such as whether the employee work in a managerial or non-managerial position. The pay rate appreciates the skills and qualification of the employee and their performance in the organization. These pay rates are adjusted several times in the year to ensure that employees are compensated within the stipulated timeframes and within acceptable pay ranges. The company has several compensation packages such as base pay for all its staff members regardless of their position, annual bonuses based on profits and merits of the employees, Travel and housing allowances for all organizational employees, insurance cover for employees while in the job and a medical cover that insures the employee and their immediate family, paid leaves, one paid vacation and overpay payments rated at 1.5 times than the regular work payment. When an employee takes temporal or acting duties, temporal pay is paid at the managers’ and owners’ discretion. The temporal pay is, however, discontinued when such an employee is no longer performing the additional duties.
Promotion and Demotion
In this company, promotions will only occur when a manager or non-manager full-time employee is selected to move to a higher position with a higher pay range. The effective promotion will only be effected when the employee gains more academic and technical training and is effective when the managers establish the new position that is consistent with payroll guidelines and procedures. In some circumstance, an employee may be considered for a promotion following the recommendation of their immediate manager. When an employee moves from a part-time position in the organization and takes a full-time position, this will not be considered as a promotion. An employee who is demoted due to a job reclassification will continue to receive the same salary in their old position. However, if the employee was demoted due to disciplinary actions, their salaries are reduced by 10%.
