Compensation and Benefits
The compensation and benefits processes belong to most important HR Processes, which are critical for the organization and modern HR organization. The compensation and benefits is about managing the personnel expenses budget, setting the performance standards, setting the transparent compensation policies and introducing the competitive benefits for employees.
The organization with effective compensation and benefits drives its personnel costs, manages the performance of employees and rewards the extraordinary performance.
Compensation and Benefits Role
The compensation and benefits processes introduce the transparency into Human Resources and rewarding employees for the achieved performance. The compensation and benefits provides the managers with the compensation tools to build a difference among employees as the high performance corporate culture can be built in the organization.
The compensation and benefits department monitors the external job market and optimizes the personnel expenses budget of the organization. The compensation and benefits defines the compensation strategy, sets the transparent and simple compensation policy and defines the general rules for the extraordinary payments, bonus schemes applied in the organization and introduces general other compensation policies like the Relocation Policy, Short-Term Assignment Policies, Benefit Car Policies and other.
Compensation and Benefits Responsibilities
The compensation and benefits department is usually responsible for the transparency in the compensation practices in the organization and keeping the internal fairness of the total cash. The compensation and benefits has to supervise the development of new compensation components and keeping the general rules for the design of the compensation component.
The compensation and benefits department is responsible for the personnel expenses budget of the organization. The compensation and benefits department sets the standards for the individual salary increase, the mass salary review and the rules for the bonus payout as the organization keeps the financial stability and the planned personnel expenses budget is kept.
The compensation and benefits department has special processes to monitor the external job market as it can set the right compensation policy, which is compliant with the approved compensation strategy. The compensation and benefits department is responsible for the extensive monitoring of the market and designing the new compensation components inspired by the HR Best Practices in the compensation area.
The compensation and benefits department is always closely attached to the development of the new compensation components, which support the performance and effectivity of the organization. It co-operates with the different business units and it aligns their requests into the general rules for the compensation components, which are transparent and fair.
The compensation and benefits designs new adjustments to the compensation strategy and the compensation policy as the organization does not lose its competitive advantage on the job market.