Compensation Policy

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Compensation Policy Powered By Docstoc
					This Compensation Policy can be used by a company to establish compensation rates
and annual increases and how deductions are to be issued to employees. This
template covers all types of employees, from support staff and professional staff, to
upper third employees and management. Additionally, this template is designed to
meet the standards of the Fair Labor Standards Act (‘FLSA”). This document should be
used by small businesses or other entities to establish a consistent and universal
compensation policy for all of their employees.
Compensation Policy                                                   Policy Number: ___
Policy Owner: Human Resources / Payroll                               Page No. 2 of 2
                            Date of Policy: ___                       Date of Revisions: ___


I.        Scope of Policy

This policy applies to: (1) ___[Company Name] and its wholly-owned subsidiaries and
affiliates; (2) any other entity or organization in which ___[Company Name] owns a direct or
indirect equity interest of fifty percent (50%) or more; and (3) any organization or company in
which ___[Company Name] or an affiliate either manages or controls the day-to-day operations
of the organization or company (each a “___[Company Name] entity”), and all employees,
contractors and temporary workers of any ___[Company Name] entity. All such references to
___ [Company Name] shall hereinafter be referred to as “Company.”

II.       Purpose

The purpose of this policy is to:

       1. ensure the company’s compliance with the Fair Labor Standards Act (FLSA) regulations;

       2. to attract qualified candidates;

       3. to provide a level of compensation that will motivate staff to provide their best work; and

       4. to communicate to staff Company’s basic compensation procedures.

III.      Policy

It is the policy of Company that compensation is determined in accordance with applicable law
and regulation, including the FLSA; and that where applicable, the requirements of any
collective bargaining agreements as the provisions thereof relate to compensation.

IV.       Procedure

       1. In order to promote this policy, Company will establish rules and regulations to be
          followed by all stakeholders.

       2. Company will increase awareness of this policy through the use of regular
          communication, training and education.

       3. Company will determine employee compensation by using the following indicators and
          applying a predetermined formula that accounts for the statistical weight of each indicator
          in Company’s geographic area.

              a. Salary surveys prepared by reputable firms that include data specific to
                 Company’s industry and geographic area.


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Compensation Policy                                                                          Policy Number: ___
Policy Owner: Human Resources / Payroll                                                      Page No. 3 of 2
                            Date of Policy: ___                                              Date of Revisions: ___


                       b. Department of Labor standards and the requirements of the FLSA.

                       c. Experience level of the employee.

   4. Company will determine annual compensation increases by using the following increase
      planning matrix.

                                                                     Where Salary Falls in Pay Range
                                                  Lower Third                 Middle Third              Upper Third
                                            80-93% of market            94-107% of market         108-120% of market
                       Support Staff        value                       value                     value
                                            73-91% of market            92-110% of market         111-127% of market
                       Professional Staff   value                       value                     value



                                                                                                  Moderate increase due to
                       Upper Third          Maximum increase.
                                                                                                  being over market value.
   Performance Level




                       Middle Third
                       (Average Level of                                Median increase.
                       Performance)
                                            Less experienced staff
                                            = median or above
                                            increase.
                       Lower Third                                                                Minimum or no increase.
                                            Experienced staff =
                                            below median or no
                                            increase.

				
DOCUMENT INFO
Description: This Compensation Policy can be used by a company to establish compensation rates and annual increases and how deductions are to be issued to employees. This template covers all types of employees, from support staff and professional staff, to upper third employees and management. Additionally, this template is designed to meet the standards of the Fair Labor Standards Act (‘FLSA”). This document should be used by small businesses or other entities to establish a consistent and universal compensation policy for all of their employees.
This document is also part of a package Employee Policy Templates I 46 Documents Included