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33+ SAMPLE Compensation And Benefit Form
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What is a Compensation and Benefit Form?
A compensation and benefit form is a document that contains the salary and all the privileges that an employee can get from an employer in return for his or her work. It is a record of compensations and benefits that employees have to give to the human resource department. It is used to claim their privileges and their remuneration for the work that they have done for the company at a particular time. The form may be given weekly or monthly. This form is necessary so that the company can compile the record for proper documentation. Before a compensation and benefit form is given, the human resource management ensures a compensation and benefits plan that can ensure that employees will have the best remunerations that they deserve. It is a good decision to allot a specific salary to employees, with all the different salary matrices. And to give them a variety of benefits that can get their loyalty to the company. So, before a company decides on the compensation and benefits of its employees, it uses a strategy plan that can choose the best compensation and benefits package.
Compensations and Benefits in a Company
Every company has a different compensation and benefits package. It has its compensation and benefits policy. Here, you can learn the different types of direct compensations, indirect compensations, and other benefits in a company:
More often, employees are paid through a salary. This is a monetary amount that can be annually or monthly. This is the best compensation strategy for most companies. Nearly everyone receives the payment for their works with a salary. It can be the best way on how to earn money. You can be assured that you can get a specific amount for every payday. You do not need to hustle in working just to earn money. Your pay will be definite so you will have no fear that you will earn less next time. Salary is a direct compensation that is commonly given to exempt employees. Being an exempt employee means that you are not allowed to have overtime pay.
Compensation that is based on productivity or performance is called commission. This is a type of direct compensation. The commission which can be based on the volume is applied when the employees made a particular number of products. It is also applied in making sales. This type of compensation is common to sales representatives and real estate brokers. They will make sales for the company and they are compensated in part of that sale. Whether they have made the sales in such a short time and the sales are big, they can get a huge amount of commission for the work that they have done.
Another that is common in having compensation is being paid hourly. Hourly pay is one type of direct compensation. Having hourly pay is being a non-exempt employee. You will be paid the minimum wage and you are allowed to have overtime. If you will work more than 40 hours, the company should pay you for the extra hours that you have worked. Employees with hourly pay use a timecard to record the hours that they have worked. The only difficulty with hourly pay is that when the company is out of budget, you may tend to be working fewer hours. Your pay will not be so assured with hourly pay.
Bonus is a good way how companies can motivate their workers. This is especially true with sales professionals. Bonuses can make them more enthusiastic about their job. Mostly, bonuses are also given depending on the employee’s performance. If you have made something good in your company, your boss may give you some bonus to commensurate your work. Regardless of whether you are paid hourly, by salary, or by commissions, you can have a bonus as an extra payment for your work. Bonus is a kind of direct compensation.
Disability insurance is one type of indirect compensation that is given to employees. When an employee gets a disability and he or she cannot work anymore, he or she can have a source of income through insurance. Disability insurance can be short-term or long-term. Short-term disability insurance can cover to give income for about 6 months while long-term disability insurance can provide a lifetime income.
PTO (Paid Time Off)
PTO or Paid Time Off is when you are going to be paid on the times that you are not working. It is an indirect compensation that includes sick leaves and personal leaves that are paid. Paid vacation is also a PTO. In companies today, they give an ‘unlimited PTO’. It is one good strategy that is used by companies because who will not like to be always paid when you are not working? Most companies offer a 10-15 days PTO, and it is enough to be a great compensation for employees.
Who will not want to have a source of income after you retire? Companies can offer a retirement plan as indirect compensation. It is something that can truly attract employees. Just with the compensation package, you can have financial security when you are old. Some retirement plans are 401(k)s, pension plans, and others.
Student Loan Assistance
Some employees still want to finish college. With a student loan assistance which is indirect compensation, the company can help them to make their way through college. This is especially important to Millenials who are having difficulties in getting educational loans. By helping them, you can make your employees have a better disposition and you can keep the best minds in your company.
Child Care Facilities
Another indirect compensation is by assisting with child care expenses. The company helps its employees who have children. They give some support to parents by sharing expenses or giving spaces for children and other facilities. This will be very good for employees who are new parents.
The company provides indirect compensation in the form of providing equipment to its employees. It can provide a work laptop or a work phone to the employees. Whatever they will use in their work, the company can provide that need so that the employees do not have to spend on equipment that they have to use.
One type of indirect compensation is providing an allowance for relocation. The company can provide all the necessary expenses that employees should spend to be near to the company where they are working. Relocation is important if the employee lives far from the company and he or she needs to work on-site.
A company can provide insurance plan to employees as a benefits package. Most insurance plans are about medical care like having regular check-ups or biometric screenings. This will show that a company cares for its employees and it wants them to be insured.
This is one benefit that a company can give to its employees. If a company will give discounts to its products, it can be one good example of a compensation and benefits package. Employees can enjoy the discounts and can buy the products of their company with such a small amount.
Another benefit that attracts employees is the perks in a company. It can give fun to employees. You can provide a playroom for them, a nap room, or some free food. Perks are something that employees can enjoy while they are in your company. Having free snacks is something good that can mean a lot to employees.
Importance of Compensation and Benefit Form
A compensation and benefits strategy is important. You need a form to include in a compensation and benefits system. This way, you can better calculate the remuneration that you have to give to an employee. A compensation and benefits form will prove to be vital. Read its following importance:
How to Create a Compensation and Benefit Form
You already know what does compensation and benefits include. Now, you may be wondering how to make a compensation and benefit form. This can also tell you how important is compensation and benefits. You can read the following steps in creating a compensation and benefit form:
Step 1: The Company’s Compensation Philosophy
You have to remember that you have to follow the company’s philosophy in giving compensation for every work that has been given to them. The calculation of compensation and benefits should depend on the compensation plan that your company has. There must be some standard way on how you will give direct compensation, whether by salary, hourly pay, or commission. The remuneration also varies from the members of the team up to its executive. The pay rate may also depend according on the market like:
- How the compensation will lead the market
- How the compensation will lag within the market
- How the compensation will match the market
Step 2: Analysis of the Job Market
Marketing trend is vital in giving competitive pay to your employees. You have to make a complete market analysis so that you can give the right remuneration to your workers. You can come up with something that can match the market and will attract employees to your company. If your company is in the U.S., you can use the compensation statistics that you can find in the U.S. Bureau of Labor Statistics.
Step 3: Decide on the Compensation and Choose the Benefits
When every matter that you have to consider is settled, you can decide how you can compensate your employees. You can choose whether you want to give salary, hourly pay, or commission. You can also decide on how you can grant bonuses. Choose the benefits that your company can give. You may choose among PTO, disability insurance, insurance plan, student loan assistance, child care facilities, providing company equipment, providing company car or transportation, retirement plan, relocation support, variety of company perks, and other benefits.
Step 4: Fill up the Form
When you already have the compensation and benefits policy of your company, you can now let your employees fill up the compensation and benefit form. Let them pass it to the human resource management so they can have their claims. Keep the form for complete documentation.
What is a Compensation and Benefits Policy?
The compensation and benefits policy are the strategies that a company uses in giving remuneration to its employees. It can be written in the employee handbook so that the employees can be well-advised with the policies.
Who is Eligible for a Salary Increase?
Every employee is eligible for a salary increase. Normally, employees who are not regular in their jobs do not get a salary increase yet, but even contract employees are eligible for an increase. The salary increase is given according to the performance evaluation of an employee.
To be sure that you are on a right track with a company, employees should consider the compensation and benefits that a company can offer. They can have the rightful return for their services if they will do that. All their hard work will be compensated well. Are you wondering what compensation and benefits form look like? This post can provide you with templates that you can consider. It has 33+ SAMPLE Compensation and Benefit Form in PDF. Download now!