Read this chapter after watching the short video introduction. The overall objective of a compensation plan is to recruit the best human capital, motivate employees to perform at their peak, and to retain employees.
The compensation package is a critical component of the strategic HRM plan since a great deal of an organization's budget is devoted to employee compensation. This chapter details compensation options, compensation theories, and applicable laws regarding compensation. It also differentiates among financial compensation, indirect financial compensation, and non-financial compensation. Under section 6.1, "Goals of a Compensation Plan", perform and answer exercise question one, which asks you to research your intended career and think about your compensation expectations with what you learn.