From the course: Human Resources: Compensation and Benefits
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Total rewards budget and communication
From the course: Human Resources: Compensation and Benefits
Total rewards budget and communication
- Employees may think their companies are stingy, but just like a personal budget, compensation budgets require trade-offs in order to control costs. It's all about the choices that managers make and how they communicate those choices to employees. Sometimes, companies need to reduce labor costs, and there are a number of things they can do. They can reduce head count through layoffs or incentives to leave. They can increase overtime instead of hiring more employees. They can reduce benefits by suspending matching contributions or controlling the costs of healthcare, or by eliminating pay raises or tying pay more closely to increases in productivity or profitability. When a company is profitable. The key question is how much to budget for pay increases? The most common approach to doing that is top down. The budgeting process begins with top management setting an estimated pay increase budget for the whole organization. The first thing a firm needs to take into consideration is its…
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