Compensation and benefit plans are crucial to the achievements of the company. Job seekers look for the best job opportunity and compensation and benefits play a major role in the decision-making process. Compensation involves how employees are paid, hourly or salary, and benefits involve the type of medical, dental, vision and various plans offered such as a 401K for retirement. Organizations typically maximize in productivity with their business practices by providing benefits to their employees. Benefits usually attract candidates with paramount talent and experience that will lead the firm to the competitive advantage.
Compensation and benefits may be a measurement tool for the effects of productivity, company growth, and success. The effects could indirectly change the recruitment and retention of labor. The allusion of the plan is for workers to believe the compensation plan is reasonable and fair (Cascio, 2010). Managers should incorporate cross-training to engage employees to excel in performing their job duties at the highest levels for the best outcome (Cascio, 2010). The Fair Labor Standards Act (FLSA) established in 1938 set the standards for exempt and non-exempt positions.
The FLSA ascertains the standards for minimum wage, recordkeeping, overtime pay ,and the standards for youth workers and how it affects worker in the private sector according to local, state, and federal guidelines. Effective July 24, 2009 non-exempt workers will receive no less than $7. 25 per hour. Exempt staff will not receive overtime pay; however, non-exempt workers will receive one hour and half of pay after 40 hours per week when required to work overtime. Management positions, such as administrative and professional staff, sales personnel, and IT staff classified as exempt.