Human Resource Compensation Assignment

Running Head: HRM
0
Human resource
Compensation
4/7/2020

HRM
1
Contents
Part 1 Issues in the Compensation Area..........................................................................................2
Part 2 Recommendation to resolve the compensation issues..........................................................2
References........................................................................................................................................4

HRM
2
Part 1 Issues in the Compensation Area
HR has to give compensation to the employees if they suffered loss or injured at the working
place. Compensation can be in the form of money and the other economic value exchange things.
There are certain issues in the compensation which are stated below:
(1).To fix the amount of the compensation by the HR is the biggest issues as loss, injury and
suffering cannot be measured in terms of money (Michiels, 2017). To reward the
employees the fair amount has to be given so HR faces the issues in designing the fair
and the competitive program and becomes difficult to set the fixed amount.
(2).The issues related to external competitiveness have to be faced by HR professionalism as
they have to establish the competitive pay rates otherwise they will face the issue of
retaining the right talent (Long, et al., 2014). The compensation rate is not higher than the
employees get dissatisfaction and they don’t retain the company. Due to the higher
competition retaining the right talent is the major issue.
(3).The major issues are related to the compliance of the rules and regulations related to the
compensation. While managing the programs of the compensation many legal
considerations have to be taken in mind by the HR so it becomes the biggest issue. To
comply with all the terms and to make it clear the programs of the compensation to every
employee in the company are quite challenging.
(4).Another big issue which the HR faces related to the compensation is related to internal
equity. The HR wants to reward the employees who have worked harder than the others
so that outstanding performance in the company can be recognized but it creates the
issues related to the pay difference in the same job (Szymendera, 2016).
(5).The HR faces the issues when the budget is lean and there is a lack of the resources so the
compensation created for the valued employees is lower and it results in demotivating the
employees to work better.
(6).The issues of transparency have been seen in companies where the compensation strategy
is not effective. Sometimes the financial conditions of the company are not good but still,
the company has to offer compensation to their employees which becomes the issue for
HR.