HRM FPX 5310 Assessment 3 Total Rewards PackageHRM

Student Name

Capella University

HRM-FPX5310 Strategic Human Resource Management

Prof. Name:

Date

Overview

This assessment aims to evaluate the current benefits and rewards package provided by Fleet Farm and Home (FFH). An effective rewards program encompasses several critical categories that are essential for attracting highly qualified candidates who possess the necessary skills and abilities to fulfill job functions while aligning with the company’s goals and vision. A robust total rewards package can significantly reduce employee turnover and resignations, enabling FFH to maintain a strong workforce. Recognizing and rewarding employees is a vital component of an effective benefits strategy, ensuring that staff members are compensated competitively in relation to market standards. Furthermore, a well-structured total rewards package can enhance the tenure of dedicated and high-performing employees within the organization.

The total rewards strategy will highlight several key factors that contribute to a beneficial program for both employees and prospective candidates, including:

Competitive salary and incentive rewards
Non-monetary rewards
Insurance and retirement benefits
Employee time off, holiday leave, and recognition programs

HRM FPX 5310 Assessment 3 Total Rewards PackageHRM

The most effective total rewards packages are not one-size-fits-all; they can significantly influence an individual’s decision to seek employment or continue their tenure with an organization. While attractive salary packages and incentives are crucial, they are not the sole determinants for employees who also require insurance coverage for themselves and their families. Retirement options, such as stock and 401(k) plans, are essential for employees looking to establish long-term careers with FFH. Companies that offer accrued leave based on tenure, holiday leave, and employee recognition programs foster a greater sense of appreciation among their staff.

The management and administration of this total rewards package will be overseen by the executive members of the human resources department. FFH must regularly review and ensure that their total rewards package remains competitive with current market offerings as they expand into larger markets across the Midwest. Potential applicants will consider not only the company’s reputation but also the benefits, rewards, and opportunities available during their employment. The total rewards approach encompasses all resources available to employers in attracting a high-quality applicant pool and retaining current employees.

Market Comparison

An analysis of current market salaries across the United States indicates that the Midwest offers some of the highest wage levels. To remain competitive, FFH should position their salary offerings for starting sales representatives in the mid-range of current market salaries, with starting salaries set around $55,000 annually. In addition to salary, it is important to consider performance-based incentives and bonuses for high achievers. Implementing performance incentives for contracts signed and sold over $5,000 would be an excellent starting point, with a flat-rate incentive of $250 per signed contract. As performance improves, employees who excel should receive commission bonuses based on their total sales, with a proposed rate of 5% for sales exceeding $10,000, ensuring profitability for FFH while rewarding employees.

Non-Monetary Compensation

In developing a total rewards package, it is crucial to consider the current family dynamics of employees. Approximately 60% of households with children have two working parents, making benefits related to parental leave and flexibility in scheduling essential. Offering parental leave, flexible work schedules, and options for prepaid college savings or dependent care savings plans can attract more qualified applicants to FFH. Parental leave is particularly important for families where both parents are employed, as unexpected situations may require employees to leave work early, arrive late, or take time off for family obligations. FFH should evaluate their attendance and scheduling requirements to identify areas where adjustments can be made to accommodate employees needing flexibility. While some positions may necessitate strict schedules, roles such as sales representatives may have the opportunity to work remotely when family obligations arise.

Parental Leave and Non-Monetary Compensation

It is essential for Fleet Farm and Home (FFH) to consider the personal situations of their employees and develop a strategy to support working parents through parental leave. Another significant aspect of non-monetary compensation includes providing access to on-site amenities, such as free beverages (bottled water, coffee, etc.) and employee discount programs. Amenities may also encompass an employee-only gym, clean restrooms, and breakrooms stocked with complimentary beverages. Offering discounts of approximately 5% on retail-priced items at FFH can be a substantial benefit that does not require a significant monetary investment in employee salaries or benefits. Small gestures, such as discounts and complimentary amenities, can greatly enhance employees’ perceptions of the company’s appreciation for their dedication.

Insurance and Retirement Benefits

According to the 2020 U.S. Bureau of Labor Statistics National Compensation Survey, participation in medical benefit plans is prevalent across various industries, with approximately 75% of workers in the private sector enrolling when offered. FFH should provide a comprehensive benefits package that includes medical, dental, and vision coverage for both employees and their families. A higher percentage of employer-paid coverage will make these options more appealing to both potential and current employees. Typically, employers in the private sector cover 70-85% of employee premiums while contributing a smaller percentage for dependents. It is crucial for FFH to ensure that insurance coverage for employees and their dependents is consistent across the organization to prevent any form of discrimination.

Retirement planning options are a vital component of a well-executed total rewards package. As a private sector employer, FFH should collaborate with a 401(k) or savings plan administrator that allows employees to contribute a portion of their wages, supplemented by company contributions. Providing a retirement benefit can encourage both current employees and new hires to commit to long-term careers with the organization. FFH should analyze competitive retirement programs in the market to identify plans that offer the best returns for employees while minimizing costs for the employer.

Paid Time Off, Holidays, and Recognition

Total compensation statements provide employees with a comprehensive overview of their annual pay package, encompassing both direct and indirect compensation (SHRM, 2017). Employee perks and rewards are considered alongside salary and insurance offerings. Total rewards programs enable employers to evaluate each employee based on productivity, tenure, and the personal time they require outside of work. Employee value is not solely determined by salary; rather, employees appreciate the investment that employers make in their time and efforts, which fosters a positive workplace atmosphere and enhances engagement and morale. Employees are more likely to remain loyal to a company that acknowledges the importance of their time and personal interests.

Flexibility in the workplace resonates with all generations of employees. Offering paid time off accruals is an excellent way to reward employees for their hard work. While accrual rates may vary by company, a standard practice is to allow employees to accrue between eight (8) to ten (10) hours of paid time off per month worked. This policy enables dedicated employees to take necessary leave for personal reasons. Companies with employees who accumulate excessive paid time off may consider implementing a paid time buyback plan, allowing employees to sell back accrued days at a designated time of year, subject to executive management approval. This option could be particularly beneficial at the end of the fiscal year, when budgets are closing, and before the holiday season, when many families face financial pressures.

In addition to personal time off, holiday pay for nationally recognized holidays is crucial. Employers who value traditions and provide time off for holidays can attract a strong workforce. Although some holidays, such as Thanksgiving, coincide with peak shopping periods, FFH can still reward employees working on those days by offering additional leave time or overtime pay. While it may not be feasible to close stores entirely during the holiday season, rewarding employees who work on these days with time off to be used later or extra pay can encourage more employees to work during holidays.

Recognition opportunities for employees incentivize higher performance and foster a sense of personal achievement. Designating an “Employee of the Month,” featuring accomplishments in company newsletters, and hosting periodic gatherings to celebrate departmental successes provide non-monetary benefits that recognize employee contributions. Highlighting top performers on a dedicated wall within the store can further motivate employees to excel.

Legal Compliance

To ensure legal compliance in offering a total rewards package, Fleet Farm and Home (FFH) must evaluate and confirm that their operations adhere to legal guidelines outlined in company policy. A critical component of this assessment is the Fair Labor Standards Act (FLSA), which establishes essential regulations regarding minimum wage, overtime pay, timekeeping, and the employment of minors (under 18 years of age). FFH is required to pay employees at least the minimum wage, which can vary by state, necessitating careful consideration for each office’s location. The standard workweek is defined as forty (40) hours, and any hours worked beyond this threshold must be compensated at an overtime rate. Non-compliance with these regulations can lead to serious legal consequences, including fines, lawsuits, and potential business closure.

In addition to fair wages and overtime compensation, the FLSA also protects youth employment. Minors are restricted from working more than forty (40) hours per week and are prohibited from working past 10 PM on nights preceding school days. Another important legal consideration is the Age Discrimination in Employment Act of 1967 (ADEA), which safeguards individuals aged forty (40) and older from discrimination in various employment aspects, including hiring, promotion opportunities, compensation, and termination. Employment decisions must be based solely on job performance rather than age.

HRM FPX 5310 Assessment 3 Total Rewards PackageHRM

The assessment of the total rewards package should ensure that it does not discriminate against any individuals who may benefit from it, including those with disabilities under the Americans with Disabilities Act (ADA) or those needing to utilize benefits under the Family and Medical Leave Act (FMLA). Fair employment practices must be upheld, ensuring equal access to promotions, benefits, and participation in incentive programs across the organization. The total rewards package should be accessible to all employees, including current staff and potential applicants. Under the FMLA, employees who meet the minimum requirements—specifically, one year of employment and at least 1,250 working hours—are entitled to utilize this benefit. This act is designed to prevent discrimination against employees regarding medical situations affecting themselves or their family members.

Additionally, the Pregnancy Discrimination Act (PDA) prohibits discrimination against pregnant employees concerning any aspect of employment, including hiring, termination, equal pay, promotion opportunities, training, and benefits such as health insurance and leave time. Misusing the total rewards package to penalize or alienate employees based on discriminatory practices is strictly prohibited.

Recommendation

To implement an effective total rewards package, Fleet Farm and Home should begin by assessing their current liabilities, benefits, and policies. This initial step will provide a comprehensive evaluation that facilitates expansion, necessary changes, and the effective implementation of policies that ensure legal compliance. Following this assessment, FFH should focus on aligning income and market salaries. According to statistics from the U.S. Department of Labor, FFH should aim to offer a competitive median salary range for each position within the company, ensuring compliance with local and federal minimum wage laws while enhancing the overall benefits package.

Regarding insurance and retirement offerings, FFH should provide a comprehensive plan that covers 80% of insurance costs for employees, with employees responsible for the remaining 20% of the monthly premium. Family and dependent coverage should be offered at 65% coverage, with employees contributing 35%. This structure will enhance employee retention and attract potential candidates. Furthermore, FFH should seek a retirement plan with low administrative fees and a strong historical return. Comparisons should be made with top companies such as Nationwide and John Hancock. FFH will contribute 3% of each employee’s annual earnings to the retirement plan, allowing employees to contribute up to 6% of their income.

Bonuses and Commission Structure

In evaluating bonuses and commissions, the company will provide sales team members with a fixed bonus based on quarterly sales performance, along with an incentive program for top performers that operates on a percentage-based earnings schedule. Paid leave and holiday pay will be uniformly offered across the organization. Employees who work a minimum of 100 hours in a month will accrue 8 hours of leave time, which can be used for paid personal leave or vacation, including circumstances that qualify under the Family and Medical Leave Act (FMLA). This policy ensures that employees have the opportunity to earn one day off per month, in addition to any holiday time that may occur during that month.

Employees with at least 80 hours of accrued leave will have the option to sell back their leave time during the month of October each fiscal year. The maximum number of hours eligible for buyback will be 40, compensated at the employee’s current hourly wage. Performance recognition will be a key component of the rewards program, with monthly acknowledgments for top performers designated as Employee of the Month. Additionally, a company newsletter will feature customer compliments, management recommendations for recognition, and highlights of significant events in employees’ professional and personal lives.

By offering this comprehensive total rewards package, FFH aims to maintain a competitive edge over rival businesses. This package emphasizes not only monetary compensation but also addresses the individual needs of employees, fostering a positive workplace environment with high morale and ample opportunities for growth. The recommendations support a diverse workforce, focusing on equitable rewards and benefits based on job performance and employment-related factors, without discrimination against any protected group. The implementation of this plan will ensure that no benefits or guidelines are influenced by factors such as sex, race, gender orientation, age, disability, or medical conditions. It is crucial to maintain clear and consistent guidelines that do not reflect any personal biases.

References

Bureau of Labor Statistics. (n.d.). Databases, tables and calculators by subject. Retrieved from https://www.bls.gov/data/#employment

Pregnancy Discrimination Act. (n.d.). Retrieved from https://www.eeoc.gov/pregnancydiscrimination#:~:text=The%20Pregnancy%20Discrimination%20Act%20(PDA,term%20or%20condition%20of%20employment.

U.S. Department of Labor. (2019). Family and Medical Leave Act | U.S. Department of Labor. Retrieved from https://www.dol.gov/agencies/whd/fmla

U.S. Department of Labor, Employment and Training Administration. (n.d.). O*Net online. Retrieved from https://www.onetonline.org/