Remuneration Strategy for STAR Industries

This document discusses the aims of a remuneration strategy for STAR Industries, including alignment with organizational strategy and support for objectives. It also explores external factors to consider, such as the labor market and labor laws. The document further explains job evaluation methods and the importance of internal and external equity in compensation. Finally, it covers strategies for validating and retaining employees, as well as the market positions and benefits that STAR Industries can offer.

Running head: STAR INDUSTRIES
STAR INDUSTRIES
Name of Student
Name of University
Author’s Note

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Answer 1
Aims of a remuneration strategy for the organization includes ensuring the fact the
practices are aligned with the strategy of the organization, in order to solve new problems
various ne benefits and comp programs are designed. This is usually good for the purpose of
addressing issues but it might not be able to consider the integration along with various
current programs or the alignment with the STAR industries’ strategy of philosophy (Noe,
Hollenbeck & Gerhart, 2017). One more aim includes ensuring the programs support their
objectives, with time various organizational objectives might change and benefits and
compensations program might not support the newly introduced objectives. Hence numerous
consequences that are unintended from the plans of remuneration might arise. Such as a plan
for bonus which would emphasize the top line revenue might generate a huge amount of sales
but might encourage the deep discounting which leads to a poor performance of bottom line.
One more aim includes preparing for expansion or growth, as STAR industries prepare
moving to various new markets, considering the practices that are competitive in these
markets would help the organization in attracting as well as retaining talent. It would also
help in establishing various sustainable costs related to the competitors.
Answer 2
Five external factors that I need to consider during the development of a remuneration
strategy are as follows
1. Labour market: the demand as well as supply of labour results in influencing the
employee compensation. The low wages is provided in case the demand is less
compared to the actual supply of the labour. High wages is provided if the demand is
comparatively more than the actual supply of the labour.

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2. Going rate: the remuneration is usually decided based on the rate which has been
prevailing in the field.
3. Cost of living: the cost of the living index tends to influence the remuneration of
employees in such a way that with the increase or decrease in the aspect of price level
as well as the consumer price index, the salary varied accordingly.
4. Labour unions: various powerful labour unions result in influencing the plan of
remuneration of the organization (Noe, Hollenbeck & Gerhart, 2017). The labour
unions are formed when the demand is more and the supply of labour is less or have
been involved in dangerous work and hence asks for more money for the purpose of
endangering their lives.
5. Labour laws: there are various laws that have been passed by the Government for the
purpose of safeguarding various workers from the exploitation of the employers.
Five external factors that I need to consider during the development of a remuneration
strategy are as follows
1. Ability to pay: large companies have the ability to pay more compensations as
compared to the competing organizations, small companies can afford to keep up their
pay scale to the level of the competing organization.
2. Job evaluation as well as performance appraisal: it helps in having satisfactory
differential pays for various jobs (Bratton & Gold, 2017). Performance appraisal helps
employees to earn more on the basis of their performance.
3. Employee: the employee or a particular worker influences the compensation in terms
of performance, experience and potential.
4. Business strategy: the strategy influences compensation of employees. If the
organization wants to proceed smoothly, and manage workers, it would provide less
pay or equal to the pay provided by other organizations.

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Answer 3
Job evaluation can be defined as a particular process of rating a particular job in a
specific organization. This particular process where value and worth of various jobs are
established in a specific job hierarchy. This attempts in comparing the relative intrinsic worth
or value of jobs in a particular organization. Hence job evaluation is a particular process that
is comparative in nature (Noe, Hollenbeck & Gerhart, 2017). The major objective of the
process of job evaluation includes the fact that it determines relative worth of various jobs
within the organization for the purpose of serving as a basis, these available values of various
jobs in a particular machinery or an organization. The process of job evaluation usually aims
in providing a particular standard procedure for the purpose of determination of the actual
worth of every job in a specific organization, determining the equitable wage differences
among various jobs in the company, eliminating the inequalities in the wages and many more.
Job evaluation is considered as a logical process as well as an objective technique which
helps in the process of developing a specific equitable along with consistent wage as well as
salary structure which is based on relative worth of jobs in a specific organization.
The three methods of job evaluation that can be used by STAR industries include
ranking method, grading method and points rating. The ranking method could be used
because it is very economical in use, it is very less time consuming, it also involves less
amount of paper work (Bratton & Gold, 2017). It should also be used because it analysed and
describes jobs, brings about the aspects that must be used for the purpose of comparing jobs.
Grading method should be used because it is very easy for understanding and very simple in
operating, it is very economical in nature and hence good for various small organization like
STAR industries. Points rating is another that must be used by STAR industries because it is
one of the most comprehensive as well as precise method of the evolution of jobs, it is a very

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systematic method and hence workers of the organization would favour this particular
method.
Answer 4
Internal relativity/ equity: internal equity defines to the comparison of various
positions within the business for ensuring fair pay. The employees must be paid fairly as
compared to the co-workers. Employees should perceive on the fact that they are paid fairly
when compared to their co-workers.
External relativity/ equity: external equity refers to a situation which exists when the
pay rates of a particular organization at equal to the market rates. This particular strategy is
also known as matching strategy (Noe, Hollenbeck & Gerhart, 2017). A particular
employer’s goal must be to pay what is required for attracting, retaining as well as motivating
a sufficient amount of various qualified employees.
Interpersonal relativity/ equity: interpersonal equity is a particular elaboration on the
actual matter of fairness and mdash, this makes as well as breaks numerous partnerships. This
equity includes a particular examination of what every partner plans in contributing to the
specific business like expertise, reputation, money as well as clients. Some more factors that
are important include indirect compensation, tiles as well as positions, time off, power,
authority and control, freedom of travelling or the freedom of not travelling.
Answer 5
The steps that I would undertake for the purpose of validating this claim is to making
them understand that they might get more paid in another organization but they would never
get the similar value in the new organization (Bratton & Gold, 2017). I would explain them
the fact that the post that they hold in my organization is more valuable than the more salary

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that would be provided by another organization, my organization would provide them with a
better carrier development which would not be provided by another organization.
The steps that I would undertake for the purpose of retaining them include
 Providing a hike in their salary based in their post and performances.
 Giving them with more praise as well as recognition
 Measure their satisfaction in this particular job which might not be achieved in
another organization.
 Discussing regarding their emotions as well as attitudes and try to solve issues
that they are facing if any.
 Make them feel necessary they would be made realized that they are valuable
employees to the organization and their absence would be a loss for the
organization.
Answer 6
The possible market positions that an organization could take in relation to wages and salaries
paid include organizational intelligence, this defines the ability of an organization of
acquiring as well as using knowledge for the purpose of achieving its goals and objectives.
Some common types of organizational intelligence include know how, this strategy is directly
applicable to the organization like processes, procedures, it also includes the amount of
salaries that would be provided to employees along with the incentives structure (Bratton &
Gold, 2017). One more example is decision support which helps in gathering data and hence
using it or supporting the decision making, the organization can derive data from the market
place of the salaries that are provided by the organizations along with the benefits provided to
them. One more example that would be helpful include optimization, this process of
measuring the objectives of the organization, improving as well as measuring the methods

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used. This would help the company in undertaking wise decisions regarding the wages
provided to the employees.
The range of benefits and incentives that could be offered to employees are as follows
1. Greater workforce independence: employees usually seek guidance from the
management of the organization but they do not respond properly to being a short
leash and continuously being watched. Most of the employees respond to greater
independence along with more opportunity.
2. Education and development opportunities: most of the employees believe that the best
way by which they can advance their careers is by receiving special training and
hence learn new skills on their jobs.
3. Better options for healthcare: healthcare costs are usually higher, and employees care
about health coverage that is of good quality. This is done in order to meet the needs
in the form of an employer, one step that can be undertaken is by introducing health
savings accounts for the employees.
4. Performance bonuses: this wound encourage and motivate various employees in
preforming even better. It is not mandatory that the performance bonuses have to be
monetary in nature. Employers can talk to employees and hence ask them regarding
the types of awards they would like to be rewarded with. Some employees might
prefer vacation time over the money (Bratton & Gold, 2017). This is a matter that
needs to be thought about while starting to brainstorm various ideas for the purpose of
offering benefits to employees.
Answer 7
Impacts of FBT on salary packaging depends on the employer, in case the employee
works for a FBT exempt employer, the employee would be able to salary the package items

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of around $15,900 per annum and he would not need to pay any FBT or any sort of pay as
you go tax. If an employee works as a FBT relatable employer, the employee can salary
sacrifice up to around $15,900 per annum without any payment of PAYG tax. In this case the
employee would have to pay an FBT tax in case they earn over around $87, 000 per annum,
as the rebated FBT amount is comparatively low than the applicable PAYG tax rate. Reba
table employers include various private schools, sporting clubs and testing authorities.
Answer 8
STAR industries could position itself in the fourth position out of five as a particular
employer of choice, it is because it provides job security to employees, authority and
empowerment, respect, access to data, commitment, involvement, positive relationship with
various co-workers, work-life balance, performance culture, fairness and some more benefits
to the employees. The organization also substitutes with a vital vision or mission. The
organization strives to pay the employees compensation which might include their salary
along with benefits that are above or at least equal to the market rates. It also offers
employees with a comprehensive package of employee benefits because they are able to
afford additional benefits for various employees such as health insurance, paid holidays, paid
time offs along with paid vacation.

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References
Bratton, J., & Gold, J. (2017). Human resource management: theory and practice. Palgrave.
Noe, R. A., Hollenbeck, J. R., Gerhart, B., & Wright, P. M. (2017). Human resource
management: Gaining a competitive advantage. New York, NY: McGraw-Hill
Education.