Compensation and Benefits - Research Paper Example

Compensation and Benefits Introduction Employee Compensation and Benefits tends to be a really difficult issue for the VP of HR in any viable health care institution. The United States of America is already facing a dire shortage of the qualified and skilled health care personnel. In the coming times, with the stress and work pressure poised to increase in the health care institutions, things could be expected to get tougher. Since I joined as a VP of HR of the health care institution under consideration, I found it immensely imperative to pursue a holistic approach towards staff compensation and benefits. Considering the existing employment and turn over scenario in the health care institutions, it is a must to pursue such reward and compensation policies that help the organizations achieve their salient objectives. Labor Relations Challenges facing the Health Care Industry The question that has come to the center of the health care industry is that why the apt reward and compensation policies have assumed a pivotal position in the current times. One primary explanation for the dire need of appropriate reward and compensation policies is that the employment scenario for the trained, qualified and skilled health care professionals is getting more competitive (Hedge & Pulakos, 2002). Though considering the housing bubble bust and the ensuing recessionary trends may have diluted the employment prospective a little, still, retaining the qualified, skilled and experienced employees has emerged to be a pivotal issue in most of the health care institutions. The health care institutions spend loads of money and resources in training and educating the employees, hence, it has become more important than before to pursue such compensation and benefit policies that aid the retention of the skilled and trained employees. Going by the fact that the resources at the disposal of the health care institutions are shrinking, the organizations are desperately looking for such policies that help in the retention of employees. To be able to grapple with such scarcity of resources, the HR administrators are required to look into a wide range of tangible and intangible factors that help them attract, retain and motivate employees. The other thing is that the health care organizations are more than ever under pressure to enhance employee engagement and initiative (Hedge & Pulakos). The competitive environment out there is pushing the health care organizations to make the best of the human resources at their disposal. It has become more than ever important for the HR administrators operating in the health care industry to depend solely on the employee initiative to act and perform in a way that further the organizational aims, objectives and goals. The other factor that is necessitating a revamping of the traditional compensation and benefits approaches is the augmenting diversity of the work force in the health care organizations (Hedge & Pulakos 2002). The participation of the foreign immigrants in the health care industry has increased tremendously. The changes in the demographic composition of the United States of America have also increased the work place diversity. With the enhanced diversity at the work place, the expectations of employees from the health care organizations in which they serve have also undergone a tremendous change. Hence, going by the above mentioned three factors, the HR administrators in the health care organizations are utterly required to pursue a more flexible approach towards compensation and benefits (Fitz-Enz, 2009). Total Reward Approach Total reward tends to be a broad based and holistic approach towards employee benefits, compensation and rewards (Rumpel & Medcof, 2006). Total rewards is a potent tool that a VP of HR could have at one’s disposal that could immensely bolster the objective of attracting, motivating and retaining skilled employees. Total rewards approach towards benefits and compensation takes within its scopes all the rewards and benefits that the employees tend to garner owing to the employment relations they have with a health care organization and which are considered by the employees to be valuable (Rumpel & Medcof 2006). The primary objective of the total rewards approach towards compensation is to help the health care organizations optimize the benefit and compensation packages they extend to their employees (Rumpel & Medcof, 2006). This helps the health care administrators to enhance the benefits accrued from the resources spent on benefitting and compensating employees. There is no denying the fact that the traditional compensation and benefits approaches primarily happened to be monetary in their scope and perspective and envisaged reward options in their pecuniary aspects only (Labedz & Berry, 2011). The total reward approach in contrast tends to focus on the overall and total employee proposition and focuses on everything that an employee could accrue owing to employment relationship one shares with the organization. Hence the list of benefits and compensations that could be extended by a total rewards approach could turn out to be really broad based, which could include within its ambit many tangible and intangible financial benefits, opportunities for education and skill enhancement, social initiatives sponsored and managed by the employer, and a wide range of many other employment related benefits. Outlines of Total Reward Approach towards Compensation and Benefits Total reward approach comprises of five salient elements that have the facets, dimensions, programs and elements targeted at attracting, motivating and retaining employees. These elements are: Compensation It is the compensation provided by a health care organization to an employee for the services rendered by one (Rumpel & Medcof, 2006). Compensation includes the fixed pay that remains constant over time, short term incentives aimed at boosting performance over a definite time scale, long term incentives targeting employee performance over a long time period and variable pay that is directly linked to an employee’s level of performance. Benefits This includes additional rewards extended by a health care organization to an employee, above and over the fixed pay (Rumpel & Medcof, 2006). The benefits extended to the employees by a health care organization provide them with a measure of security and peace of mind. These benefits include the legally required or mandatory benefits like various types of insurances, health and welfare related benefits, retirement benefits and the payments for time not worked. Development and Career Opportunities These are the benefits designed to help the employees augment their qualifications and skills enhancement. These benefits help the health care administrators to further their organizational interests and objectives by furthering the employee competence and skill proficiency (Cooper, Dyck & Frohlich, 1992). Performance & Recognition This involves the programs aimed at assessing and recognizing the efforts made by the employees towards the furthering the organizational goals and objectives (Rumpel & Medcof, 2006). This may include measures like performance reviews, project evaluations, meetings, service awards, peer recognition awards, suggestions programs, etc. Such performance and recognition measures immensely motivate the employees to work over and above the average expectations. Work-Life Balance There is no denying the fact that going by the nature of work and the overall workload, the health care workers happen to be one of the most stressed professional categories. Hence, it is imperative for the health care administrators to come out with a set of policy initiatives, programs, and measures that may help the employees achieve success both at home and at work (Rumpel & Medcof, 2006). This involves ushering in flexibility at the work place, supporting the health and wellness of employees, extending timely financial support to the employees, and helping employees make a creative use of both their unpaid and paid time. Conclusion There is no denying the fact that the traditional compensation and benefit approaches happened to be solely monetary in their approach. However, in the current scenario, employees tend to have expectations from the employers that go way beyond money only. Total reward is a holistic benefits and compensation approach that takes care of varied and multiple employee expectations. References Cooper, C., Dyck, B. & Frohlich, N. (1992). Improving the Effectiveness of Gainsharing: The Role of Fairness and Participation. Administrative Science Quarterly, 37(3), 471-473. Fitz-Enz, Jac. (2009). The Roi of Human Capital. New York: AMACOM. Hedge, J. W. & Pulakos, E. D. (2002). Implementing Organizational Interventions. San Francisco: Jossey Bass. Labedz, C. & Berry, G. R. (2011). Making Sense of Small Business Growth: A Right Workforce Template for Growing Firms. Journal of Applied Management & Entrepreneurship, 6(2), 61-63. Rumpel, S. & Medcof, J. W. (2006). Total Rewards: Good Fit for Tech Workers. Research Technology Management, 9(5), 27-29. Read More