Compensation and Benefits in the Modern Workplace

Times have changed. The most significant change in employer/employee relationships is the shift of responsibility from the employer to employee. Across the country, companies are becoming less paternalistic in their management of employees. Companies are giving employees the opportunity to participate in the selection and planning of their retirement, compensation and other benefits programs. In another area, companies are becoming less paternalistic in their treatment of employees as workers. Employees are valued for their skills, levels of performance, and contributions to the growth and well-being of the company. Employers can no longer afford to carry long-term employees until retirement if they do not perform. Downsizing and reengineering are taking their toll on the workforce.

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lar paycheck in a set amount will no longer be the norm. Surveys indicate a trend among companies to give lower salary increases, implement pay for performance programs, extend review periods, give lump sum merit increases, and use two-tier compensation systems (Boyett & Conn, 1991, p. 123). Benefits and compensation are changing because the workplace is changing. The age of entitlement to automatic salary increases and better, more expensive benefit packages has ended. Companies feel less inclined to provide long-term benefits. Benefits are expensive and account for a substantial share of total worker expenses. The cradle-to-grave relationship between employer and employee that baby boomers' parents enjoyed is a thing of the past. With increased workforce mobility, especially among skilled workers, today's employee could be working for a competitor tomorrow. Employers no longer feel either the obligation or the necessity to provide the same high level of benefits for their employees. Another factor which has contributed to the gradual reduction in benefits is the prevalent attitude among employees that benefits, once given, cannot be taken away. Changing benefit packages was never easy, and, when contractual ag
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Approximate Word count = 2585
Approximate Pages = 10 (250 words per page)

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