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BUS301 Human Resource Management

Published : 09-Sep,2021  |  Views : 10


You are the HR manager of a relatively new retail company that has both retail stores and Internet sales. Your company is steadily growing in revenue and profitability. The company realizes that in order to retain the solid, highly productive workforce it currently has in place, it is important to enhance the base compensation and benefits package offered to the employees.
The company currently offers a basic compensation program and only federally mandated benefits. Employee surveys suggest the compensation and benefits program may be out of date. Employees are beginning to consider leaving the organization.



Employees of an organization need certain recognition for the hard work done by them. Recognition of an employee refers to the timely formal or informal acknowledgement of a person’s behavior or efforts in the business result that supports the goals and values of the organization. Showing appreciation for their work is key to the success of the organization as the employees will get motivated and will perform in a much better way. Recognizing the employees for their hard work also makes the employees understand about how much the company cares for them and how much they are valuable to the company. Apart from the work productivity the following actions helps the employees to have a mental satisfaction and establish a loyalty.

Methods of Weighing Incentive Pay

Incentive plans is one of the key to ensure the success of the organization. It helps to motivate the employees of the organization to perform at a higher level and restricts them to engage themselves in unethical behaviors (Armstrong & Taylor, 2014). The HR manager of an organization needs to be well aware of every single problem that are related to the implementation of the incentive plans of the organization. Every incentive is administered much effectively. They serve as useful business tools as they support the higher levels of performance of the employees without increasing the fixed cost of basic pay. Experts believe that an incentive of a mere 3% to 4% is nothing and does not have any impact upon the employees as because such a meager increase fails to segment out the star performers in the organization. A better incentive policy can come in handy and will surely help in the growth of the organization. Some of the methods to weigh the Incentive Pay have been discussed in details below by the researcher;

  1. Rewarding Quality Work-Rewarding quality work has been one of the main incentive plans of most of the organizations since a long time. The quality work done by the employees in the organization is rewarded for two reasons. The first one is to motivate the selected employees for their work while the second one is to motivate the other employees to perform better and achieve the results that their colleagues have received for hard work. The HR manager who is in charge of a new retail company has to implement the incentive policy in a proper way so that the employees must not hurry to complete the work within a stipulated time just to receive the incentive. There are lots of employees within the organization who might achieve a double output in terms of production which naturally increases their pay (Beardwell & Thompson, 2014). The HR manager must take appropriate safeguards to implement a proper incentive plan or else it might result in poor performance both from the employees’ front and also from the organization front.
  2. Laying the Groundwork-The HR manager of the organization has the primary aim to devise out whether providing incentives is really necessary for the company and the employees. As mentioned in the case the survey has suggested a change in the compensation package as because the employees have deemed it to be outdated. The HR manager has to design the incentive plan and place it before the management as the company is in fear of losing its employees in such a critical condition. The HR manager must involve the employees; establish a link between the performance of the employees and the payout packages of the company.

Core Legal Requirements

The legal requirements affecting the employee benefits are very much complicated and the absence of proper monitoring can be hazardous to the growth of the organization (Sparrow, Brewster & Chung, 2016). The organizations generally guarantee the social benefits, unemployment insurance, compensations, family or medical leave, health care facilities and many more such diverse facilities. The IRS provides a more favorable tax treatment for the employees that are classified as qualified plans. The details of such a plan vary from one type of benefit to the other type of benefit.

Legally required benefits protect the worker’s health, well being and income. The employee benefits are categorized under two categories namely the benefits that are required by law and the benefits that are chosen voluntarily by the employees (Reiche et al. 2016). The benefits include;

  1. Social Security, medical Care and Federal Insurance Contributions Act-FICA is a federal payroll (employment) tax that is used for funding the social security’s and Medicare. Both the employers and the employees contribute to the funds during their stint in the offices. The security tax is fixed at 6.2% of gross compensation. Medicare tax is fixed at 1.45% percent of gross compensation.
  2. Unemployment Insurance-The following type of insurance helps the workers when they lose their jobs.
  3. Health Insurance-Health Insurance is mandatory for the companies having more than 50 employees. The health insurance acts as a medical cover for all the employees.
  4. Medical Leave-The employees of an organization are eligible for 12 weeks leave in a year for medical reasons or some other emergency reasons.

Additional Benefits

Apart from the above mentioned benefits the HR management of the organizations can think and implement innovative ideas to provide the employees with some extra benefits like;

  1. Hazard Pay-Hazard Pay is an extra compensation that can be paid to the employees for performing some critical tasks that may be risky. This kind of benefits can be provided to the employees who face extreme discomfort and emotional distress while doing the jobs (Marchington et al. 2016). Such types of extra compensation are awarded to the employees in addition to their regular hourly wages or salary. Generally such an compensation is paid to the employees who are involved in challenging works like workers of the mine, workers involved in construction business and many more as such.
  2. Paid Holidays-Working on a holiday can be a special scheme provided by the employers to the employees. Paid Holidays are totally dependent on whether the employees are bind within the contract of the company or contract of the company. Paid Holidays are extra benefits for the employees as because they help the organization to gain the loyalty and trust of the employees (Purce, 2014).
  3. Pay Raise-Pay raise is one of the most important steps that can be implemented by the organization to motivate the employees and make them more productive. The HR management of the organization can make sure to implement such Pay Raise either in a stipulated time period or based on their performance.
  4. Vacation leave-Providing the employees with some short or long vacation leaves can be beneficial for both the employees as well as the organization. Approving the vacations of the employees help the organization to earn the loyalty of the organization.

Factors to be considered before implementing Benefit Plans

Well structured benefit plans enable the employers to easily recognize and reward their staffs. Such tasks help the organization to promote loyalty and speed up the process of engagement within the organization and to increase the productivity levels of the organization (Ghosh et al. 2016).

Communication of Benefits to the Employees

The HR management of the organization can implement some simple steps to communicate the benefits to the employees.

  1. Explaining the Benefits to the Employees-The management of the organization must implement an effective communication system to make sure that all the employees are well aware of the benefits that are provided to them by the organization.
  2. Assigning an actual value of the Benefits-The employees of the organization always tend to overlook the rewards and benefits of the organization and try to assess them on the basis of monetary value. Assigning the value of the benefits and making the employees aware about the same will motivate them (Raub, 2016).
  3. Including an Outline of the benefits on the website of the Company-The benefits provided to the employees by the organization must be made public and should be displayed on the website of the company.
  4. Consistently Delivering the Summary of the Benefits-The HR management of the organization must make sure of strategically scheduling the distribution of printed and electronic statements. The statement can also be put online for the employees to access the information for all the year (Block et al. 2015).

Ethical Risks

Executives inflating Stocks is one of the ethical risk based on the incentive of stock performance. The shareholders of the company can be dishonest in their approach about the actual earnings of the company and display the stock in such a method that it will be seen as a large scale investment for the buyers (Walston, Bennett & Al-Harbi, 2014).

Setting up the performance measures can also be termed as another form of ethical risk as because it will create a situation where employees will rush for completing the jobs in turn lowering the standard of the jobs (Kehoe & Wright, 2013).


The HR manager and organizations must try and keep the employees filled with benefits and different compensation packages. The management of every single organization must keep a strict vigil on applying these benefit measures on the employees. Incentive payment and other compensatory packages must be ethically implemented in the organization which decreases the chance for any complications. As because the mentioned case is based on a ne retail sales company communication forms the effective backbone for dealing with such complexities. The HR management must ensure that communication is maintained effectively to attain huge success.   


Armstrong, M., & Taylor, S. (2014). Armstrong's handbook of human resource management practice. Kogan Page Publishers.

Beardwell, J., & Thompson, A. (2014). Human resource management: a contemporary approach. Pearson Education.

Block, J. H., Millán, J. M., Román, C., & Zhou, H. (2015). Job satisfaction and wages of family employees. Entrepreneurship Theory and Practice, 39(2), 183-207.

Ghosh, P., Ghosh, P., Rai, A., Rai, A., Chauhan, R., Chauhan, R., ... & Srivastava, D. (2016). Rewards and recognition to engage private bank employees: Exploring the “obligation dimension”. Management Research Review, 39(12), 1738-1751.

Kehoe, R. R., & Wright, P. M. (2013). The impact of high-performance human resource practices on employees’ attitudes and behaviors. Journal of management, 39(2), 366-391

Marchington, M., Wilkinson, A., Donnelly, R., & Kynighou, A. (2016). Human resource management at work. Kogan Page Publishers.

Purce, J. (2014). The impact of corporate strategy on human resource management. New Perspectives on Human Resource Management (Routledge Revivals), 67.

Raub, S. (2016). When Employees Walk The Company Talk: The Importance Of Employee Involvement In Corporate Philanthropy. Human Resource Management.

Reiche, B. S., Mendenhall, M. E., & Stahl, G. K. (Eds.). (2016). Readings and cases in international human resource management. Taylor & Francis.

Sparrow, P., Brewster, C., & Chung, C. (2016). Globalizing human resource management. Routledge.

Walston, S. L., Bennett, C. J., & Al-Harbi, A. (2014). Understanding the factors affecting employees’ perceived benefits of healthcare information technology. International Journal of Healthcare Management, 7(1), 35-44.

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