Assessment of Compensation System

Running head: COMPENSATION AND BENEFITS
Compensation and Benefits
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1COMPENSATION AND BENEFITS
1. Assessment of compensation system
The compensation system in the Simply Literature Production is in complete disarray.
The problem with the company starts with the organizational structure. The owner, Ravi is
the head of any decision making and the managers and the supervisors lack the authority in
their line of work (Idowu, 2017). This has led to confusion and delay in processes. The
employees have to work over time without payment and they do not always get the holidays
that they are entitled to. The compensation system is based on the will of the owner, Ravi. He
decides the basic pay during appointment as per his wish, increases their payment
sporadically and without no proper justification and distributes the rewards whimsically.
This do not meet the criteria of proper compensation system as it does not have any
specific goal or objective, does not use accurate information for the decisions and no
integration to organizational motivational system. The compensation system is not
communicated effectively to the employees which creates resentment among the employees.
The performance assessment system is also not fair (Mulvaney, 2019). Thus, the system
violates all of the criteria that constitutes fair compensation system.
2. Assessment of compensation system
The company policies and the unfair pay and reward system has led to the high
turnover of the employees. The new employees feel that they are undervalued as they receive
lesser rewards than the older employees. The concepts that are related to the scenario are
employee disengagement due to unfair reward policy, lack of employee motivation and
absenteeism. Employees who feel undervalued in workplace are likely to appear lesser or late
for their work. They are also likely to leave jobs when the compensation they receive are
lower than the other employees working with her (Makhija & Agarwal, 2019).