Compensation Decision Term Paper

Compensation Decisions

Your job now is to pull together all the information you've completed so far in class and make salary decisions for your team. You have completed Cathy's evaluation and received assignment feedback. This is the first year that you've made salary decisions for this team. Be sure to carefully review the information provided. You may simply type in the cells as the text will automatically wrap. You are required to:

Enter Cathy's appraisal rating (she is last on the list);

Within your budget dollars, make your salary decisions based on performance for your team taking into consideration their Salary Grade and the Pay Ranges identified for the Salary Grades (fill in the Salary Decision Column);

Within your budget dollars award bonus money (fill in the Bonus Dollars Column);

In the green line areas, provide your substantiation and risk analysis for the salary decisions made; and

Identify any items from this scenario in whole you may want to address.

Evaluation ratings are 1 = Needs Improvement to 5 = Exceeds Expectations

Salary Budget: $9,000

Bonus Budget: $5,000

Company Designated Salary Pay Ranges

A2 = $12,750 -- 17,000

A3 = 16,500 -- 22,000

A4 = 21,000 -- 28,000

Employee Information

Salary Grade

Current Salary

% at Pay Scale*

Appraisal Rating

Salary Decision

Bonus Dollars

John is a white male, 58YO, with 31 years' service. John is a good worker and you like him. You don't want to lose his skills and experience as he's been talking about retiring, but you realize his skills are too valuable to lose.

A4

$27,900

99.6%

5

$28,900

$500

Substantiation and Risk Analysis: John with his breadth of experience will prove to be a good mentor to our younger employees, particularly Calvin who has a passion for the company. His skills and experience will prove invaluable during periods of high turnover and uncertainty regarding placement

Alice is a Hispanic female, 42YO with 17 years' service. Alice is a good worker. She has a lot of potential, which netted her the higher rating. She needs some more skills and experience at this level though.

A4

$22,500

80.4%

3

$22,500

$250

Substantiation and Risk Analysis: Much like John, Alice's skills are very valuable to the company due primarily to her tenure at the position. Her bonus is lower as she may not possess the desire to grow and develop with the company. As such, she will be less inclined to be innovative or results oriented like our younger, more passionate recruits.

Calvin, 28YO black male with 9 months service. Calvin is a real go getter. He hasn't been with the company long enough to earn a higher rating, but his work is outstanding, high skill set and is looking to stay with our company for a career.

A4

$26,500

94.6%

4

$27,500

$500

Substantiation and Risk Analysis: Calvin is receiving the addition raise because of his proactive nature regarding business operations. This proactive nature will help the company in numerous aspects throughout his tenure. His desire to stay with the company is also refreshing as our salary dollars are less likely to go to waste. A risk, with Calvin's youth, is that he may pursue other endeavors and leave the company. This provides a problem as his skills and insights, particularly through his unique culture, will be lost.

Jane is a 32YO white female with 12 years' service. Jane joined the company as an A3. Her work is satisfactory, nothing to brag about, but she's been with the company awhile and can be dependable.

A3

$19,100

86.8%

3

$20,000

$250

Substantiation and Risk Analysis: Jane, much Alice seems to be complacent with her position. She is dependable but her skills have not improved to the degree of our other employees. Therefore, she should not get rewarded at the level our more proactive and developing employees are.

Beth is a 64YO Asian female with 41 years' service. Beth stated she would probably retire this year, but has yet to turn in her paperwork. She's had a history of higher ratings, but her ratings have slipped over the last 6 years.

A3

$19,700

89.5%

3

$20,000

$500

Substantiation and Risk Analysis: As she is retiring, her raise was the least out of the entire group. The value proposition Beth can provide to the company is limited given her eventual retirement. Therefore, her raise will…