Employee compensation includes all forms of pay going to employees and arising from their employment. It has two main components, direct financial payments (wages, salaries, incentives, commissions, and bonuses) and indirect financial payments (financial benefits like employer-paid insurance and vacations). The compensation plan should first advance the firm's strategic aims--management should produce an aligned reward strategy. This means creating a total pay package that produces the employee behaviors the firm needs to support and achieve its competitive strategy.

 

Question: How important is the total rewards package for employees when they are going to move from one company to another?

 

The goal of total rewards is to attract, motivate, and retain good employees. 

 

Question: How well does the company where you work use total rewards to attract, motivate and retain good employees?