MGT 613—Total Compensation Harvard Case Solution & Analysis

MGT 613—Total Compensation Case Solution

Compensation Project 1B

Refer to your compensation project for this. Assume Scott Free and the Board has accepted your compensation project and has implemented it. During an all-employee meeting, there was a lot of grumbling about the rolloutof the project. Scott, ever the one to delegate the tough stuff, asks you to come up to the front and address the employees. Write a script as to how you will respond to each question below. Remember who your audience is and put yourself in their shoes. You may use as much space as you need but don’t drone on and on! This is worth 30 points.

“It seems to us employees that you were playing favorites as the supervisors, managers, and CEO got higher pay ranges than the rest of the company. . Why?” (Explain how you were able to ensure internal equity in the development of the structure)

 The main purpose of the compensation project is to ensure that fair pay is given to all employees for their job in the company and not just the senior management (i.e. CEO, managers and supervisors). Hence, the compensation plan ensures that each employee is assessed on what he brings into the company based on his credential and relevant experience as well as the job he is performing, how much effort it requires and the amount of responsibility is bestowed upon the employee. In the development of the compensation plan, we ensured that the plan considered fairness for the employees since all the factors determine the relevant pay scale of the employee depending on the job evaluation points, which is calculated through the use of the compensation plan.It can also be seen in the company that there is a difference in the payamong the people performing the similar functions (i.e.Will being paid $90,000 whereas Bob being paid $ 50,000 respectively), therefore the question arises as to why such a huge different exists regarding the pay while the same employees perform the same function under the same designation.On the other hand, if you look at the incumbent worksheet, then it can be seen that one of the employees being overpaid is the CEO, hence the plan ensures that fair salaries are paid to all the employees performing similar jobs.......................

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