Determining How Much and How to Pay Employees

Determining your workers’ compensation could be tricky. It may be especially hard if you haven’t tried making one before. If you are unsure of where to start, here are some tips to help you jumpstart your package.

​How Much Are You Willing To Pay?
There are two things for you to remember when creating your workers’ compensation package. First, up to how much are you willing to pay? And second, what is the lowest amount you are willing to pay? The lowest amount is usually determined by law, like an employee’s minimum wage. Make sure you abide by this minimum standard to avoid any labor suits.

Your willingness to pay also depends on the candidate for a particular position. You’ll find that candidates for the same job have a different set of skills. Someone might be more qualified than the other, entitling them to higher compensation. Try creating a bracket for certain skill types to help you determine if they are entitled to a higher compensation rate.

When And How Will You Pay?
Now that you’ve fixed your compensation package, it’s time you determine how you will pay your employees. You can choose to pay your employees by the hour, fixed salary, or commission based. 

• Paying by the hour is the typical method of paying employees.
• Having a fixed salary, on the other hand, depends on the industry. Some employers choose this method because some work cannot be quantified.
• Commission based payment is determined by the number of sales an employee makes for the company. This is common for the sales industry.

Be Flexible With Your Compensation Package
Nothing is set in stone, even if you have a compensation package. There are some circumstances where you might have to forego your compensation package, to accommodate certain types of employees. For example, if you are hiring an executive or managerial position, you might have to adjust to their demands or reach a compromise. Remember, there will be instances where you need the employee more than they need you. For you to have them, you have to offer them with an appealing and competitive package. 

An employee's’ compensation is the bread and butter of every business. Creating an ideal compensation package is vital to attracting potential employees. At Cornerstone Insurance Agency, we put our clients first by offering them policies that they can afford. Learn more about our products and services by calling our agency at (888) 661-8831. You can also request for a free quote by CLICKING HERE.