Recognizing Employee Contributions

Employee recognition is a crucial element that contributes to performance of an organization. It implies communicating appreciation for the well-completed tasks as well as motivating the employees to enhance their performance. Many organizations realize that employees constitute the most valuable asset and hence the need to dedicate massive efforts towards retaining them and boosting their performance. It is however very challenging to establish new and creative mechanisms of employee recognition, which will be profoundly effective and long lasting. Therefore, this essay focuses on the ways of recognizing employees since for a human resource manager it is crucial to understand the ways of retaining a solid and highly productive workforce.

Compensation and Benefits Plan

Programs of incentive pay are meant to motivate the employees in order to perform more efficiently. Organization can use two major methods to determine the incentive pay that provide the motivation to perform. The model of performance-motivation can be used in developing a plan of incentive pay to motivate the employees. According to it, the employees know that if they perform well, they will be paid well believing that their handwork will lead to a better performance, which will be rewarded (Klubnik, 2012). The model of membership is designed to influence the perceptions and beliefs of the workers and the membership motivation basis. This method implies that the employees know that the available rewards result from their contribution to the organizational performance (Klubnik, 2012).

Any program of pay incentive is based on three major levels in an organization, which include the group, the company and the performance of an individual. The method of performance-motivation considers the performance of a group and an individual while the method of membership motivation considers the performance of the company as well as the performance of an individual. The method of performance motivation focuses on a group or individual employee motivation while the membership motivation concerns individual employee contribution to the performance of the company.

Employee benefits are very important in their lives because they determine employee’s general welfare. Therefore, the level or nature of the benefits provided by an organization may play a big role in the employee's decision whether to continue working for an organization or not. In today’s competitive business environment, most governments have set various core legal requirements for the companies to ensure that the benefits of the workers are secured as pointed out by Klubnik (2012). Examples of the core legal requirements include worker’s compensation, medical and family leave, benefits of leave, disability and social security insurance and unemployment compensation. All these core legal requirements have tax implications for the workers and, therefore, employers tend to avoid as much as possible of the benefits that are optional.

Therefore, these benefits are meant to ensure that the employees are fairly exploited by their employers. According to the law, there are certain benefits that an organization must give to its workers. The benefits required may include the worker’s and social security compensations while non-mandatory include retirement benefits, healthcare insurance and others. Every worker pays social security tax, which is proportionate to the employee’s pay. Employee compensation insurance ensures that the workers get their wages on the due date.

In addition to legally required benefits that should be given to every worker, organizations may consider optional benefits, which depend on the available resources. Benefits of leave and the employee compensation can be provided to motivate workers although the federal law does not require it. Funeral leave, jury duty, personal leave, holidays and sick leave are examples of the leave benefits. However, these benefits should be provided according to the Family and Medical Leave Act.

Additional Benefits for the Organization to Employees

Companies can offer the unemployment insurance to their workers to secure them in the event of losing a job. In this situation, the company needs to pay taxes to the respective authority that ensures the workers will be able to access their benefits whenever they lose their jobs. This initiative is good for any company because it helps develop worker’s confidence and the sense of security to motivate them perform better (Boyle, 2009). The benefit of income protection also plays an important role ensuring that a percentage of the salary is paid to the employee every month in case the worker is not able to work due to illness or injury over a long period of time.

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Another essential benefit that a company should consider providing to its workers is the life insurance. This will ensure that the life insurance covers a free lump sum tax in case of the worker’s death. The benefit is meant to support the people depending on the income of such employee, namely children or a partner. According to Boyle (2009), this benefit can motivate employees to work extra hard because of the guaranteed support to their family in case of their death. Another crucial benefit is the pension fund that the employees set aside from the income. The funds that employees have accumulated during the period of their work are presented to them when they retire (Boyle, 2009).

One of the companies’ major tasks is to incorporate the basic legal benefits like unemployment insurance, social security and workers compensation. This makes sure that the workers are given minimum protection in case of injury, unemployment or any disease. As a result, it gives them motivation to work extra hard and improve the quality of their work. It is also important to consider optional benefits when designing the benefits plan. Retirement plans, paid sick leave, and health insurance are the examples of optional benefits becoming a standard practice among companies that cannot operate efficiently without them.

It is also essential for the HR manager to consider any other additional benefits given to the employees in the company. These may include bonus plans, legal insurance, child care subsidies, and flexible working hours. Although these concepts may seem unimportant, they are crucial in increasing employee motivation and reducing the turnover. The company can also evaluate the impact of every benefit on its overall performance and its implication costs, and then decide on the priority of granting the benefits. All concepts are very important in designing the benefits plan because they ensure that every employee need is met (Russell, 2013).

As indicated by Russell (2013), the major techniques that are used in communicating compensation and plan benefits must be efficient to make sure that the workers get the right information at the right time. For the employee benefits and the plan of compensation to be authentic, the company must include all wages, incentives and benefits on the statement of payment ensuring that workers can identify them clearly on their pay slips. Efficient communication of the compensation plans involves many mediums. It helps strengthen the morale and build the team spirit of the workers collectively because all of them are subjected to the same information on their benefit plans.

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Efficiency of Common Techniques and Ethical Risks for Incentives

Companies can make their compensation and benefit plan communication more effective by ensuring that intangible benefits are included on the payment statements of the workers. Noe (2009) argues that development and special discounts, corporate wellness and care training of the workers are the examples of intangible benefits that are essential for an effective communication despite the fact that they are very hard to value. Organizations can also decide to outline their benefits on their websites in a bid for potential candidates. Well-designed communication strategy is bound to enhance company's reputation since many individuals perceive such effort as company’s commitment towards its employees (Noe, 2009). However, if the incentive contributes massively towards the total employee compensation, it equally poses ethical risks, which might affect organization’s reputation. In most cases, ethical risks imply inappropriate use of funds. Measures that can be applied to mitigate ethical risks include ensuring an equitable allocation of funds for the incentives as well as for the incentive plan. This ought to be conducted in a simple and open manner so that all employees can understand. Therefore, all the funds for providing incentives must be well documented and disclosed to the employees.


Employee recognition influences individual or team behavior towards enhancing company's results and fulfilling its goals and values. Effectiveness of the HR manager’s job requires them to understand the psychology of applying the principles of employee recognition and hence facilitating a better working relationship. Employees always want to be recognized and valued for their contribution. For company’s Human Resource manager it is crucial to understand the benefits of employee recognition, effective communication of compensation plan and consideration of ethical risks. Employee recognition helps employees gain the feeling of appreciation hence boosting their motivation, performance and self-esteem. In return, an organization benefits from increased employee engagement and productivity as well as reduced turnover. 

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