Web Based Compensation and Planning

Compensation planning involves modelling the costs associated with compensation and benefits. From the notes prepared by Dr. Nur Naha for this topic, I understand that HRIS can influence employees’ compensation planning. Compensation package is a competitive tool used to attract and retain employees with critical job skills, enhance motivation, and improve the quality of work life for employees. Compensation can be categorized into fixed compensation and variable compensation. While for benefits, there are defined contributions plans (DCP), defined benefits, flexible benefits and benefits statement in the notes.

Web-based compensation planning can be applied in other HR functions like job evaluation and pricing, compensation management and COBRA compliance. I have read a book on this topic in library. The book elaborates in details HRIS in compensation and benefits application. Due to job evaluation and pricing is a continual process, large amount of information including variety of compensable factors for each job and wage survey information are collected and must be analyzed. Compensation application can combine and summarize information from job evaluation interviews and studies. Systems can be used to extract wage survey data from various commercial and government data bases. Besides, the system can assist the compensation manager in balancing job worth, as determined by the score on the job, with labor market pay levels.

Compensation management is one of the most common HRIS applications. HRIS supports a major function in the organization by facilitating record keeping and generating a variety of standard and ad hoc reports. Compensation managers have to deal with many time consumed issues and decision makings including government reports. Compensation applications make these sophisticated analyses possible and provide the manager the ability to respond to the information demands of the job.

Benefit statement is a document prepared by the organization to manage employees’ pension or retirement plan. Today’s complicated benefits systems such as cafeteria benefits plans have been made possible in large part by HRIS benefits applications. These systems allow employees to customise their benefits to meet individual needs. Employees are often given a certain number of benefits credits and allowed to spend them on a menu of employer-supplied benefits. These systems require massive amount of records keeping since the potential benefit combinations are virtually unlimited. Without an HRIS such cafeteria benefit systems would be manageable.

For pay and rewards system, Mc Donald implement “pay for performance” philosophy. It means the payment will be increase as the results are becoming better. They offer base pay, short term incentives, long term incentives, recognition plans and company car programs. To provide these rewards to the employees, Mc Donald will need an information system to help it to keep the records of employees’ performance so the employers can evaluate the employees’ performance by referring to the records keep to give payment and rewards to the employees. 

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References:

Kavanagh, M.J., Gueutal, H.G., and Tannenbaum, S.I. (1990). Human Resource Information Systems: Development and Application. Part III, Chapter 9, pp. 254-262. Massachusetts: PWS-KENT Publishing Company.

Kavanagh, M.J., Thite, M., and Johnson, R.D. (2011). Second Edition Human Resource Information Systems: Basics, Applications, and Future Directions. Chapter 14, pp. 457-473. SAGE Publication.

Mc Donald Pay & Rewards, retrieved from McDonald portal website: http://www.aboutmcdonalds.com/mcd/corporate_careers/benefits/highlights_of_what_we_offer/pay_and_rewards.html

Compensation Management at McDonald, retrieved from: http://www.scribd.com/doc/49241499/Compensation-Management-at-Mcdonald

Veal, E.T. (2012). Slips of the Pen: When and How May ERISA Plans Correct Scrivener’s Errors? Compensation Planning Journal: Tax Management. Pp. 1-7.