Compensating Employees

Another touchy part of being a boss is how to pay your employees.  You have to be fair, or you will lose your good employees to better paying companies.  I know if you’re a small company you might not be able to pay as well as a major company, so you need to come up with better ways to compensate your employees… Day 5 – Compensating Employees

In a large company, you need to make sure you are compensating all your employees equally.  It doesn’t matter if the employee works at the main office or if they work outside of the main office, you need to make sure you are treating your employees equally.   Now, I don’t mean that you have to pay everyone the same amount of pay, but you do have to be fair.  An employee working at one store, who has been with the company for 3 years and another employee at another store, just down the street, who has worked the same number of years, should not have a difference in pay.

I know we tell employees not to discuss pay and I know we threaten them with their jobs, but I can almost guarantee that your employees are discussing their pay.  And if one employee finds out the other is making more for the same job, then you have a morale problem. I also know that if you have a business in one state and the same business in a different state, each state will probably pay different, this is to be expected.  But they should still be within reason for the area where your business is. For smaller businesses, you might have to add some incentives to help compete with bigger companies.  Find out what your employees would like.  More vacation time, better insurance, flexible hours, etc. are all things that might be worth enough to your employee that they stay with you, even though they might make better money elsewhere. Bonuses are also a good incentive.

If you have a large company and you offer your employees a $20.00 gift card and that’s it, then you might find yourself looking for new employees all the time.  Especially, if a competitor gives their employees bonuses based on the number of years they are with the company. So know your competition and figure out ways to compensate that will be beneficial to your employees.