From the course: Human Resources: Compensation and Benefits
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What is compensation?
From the course: Human Resources: Compensation and Benefits
What is compensation?
- How much do you make? That sounds like a simple question, doesn't it? Most people think immediately of their annual salary, or their hourly rate of pay. Neither answer is correct, and both answers underestimate how much a person actually makes. It's important that you understand how much you're really being paid for the work you do. So I'd like to walk you through the components of total compensation. Compensation refers to anything that an employer is willing to offer in return for an individual's contributions of time, knowledge, skills, abilities, and commitment to an organization, or to a project. Total compensation refers to monetary compensation as well as your benefits. Monetary compensation includes base pay, which is the monetary compensation that an employer pays for the work that's performed. Merit increases are in addition to base pay and are based on past performance, whereas a merit bonus is also based on past performance, but paid as a one-time lump sum. Short-term…
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