Do you agree with the argument that benefits for time not worked are those most readily available to reduce employer costs? Explain. Companies often attempt to reduce staffing costs by holding down compensation levels, shifting costs for insurance and other benefits at least partially, to workers, and instituting pay-for-performance compensation strategies. The idea that eliminating benefits for time not worked reduces employer costs has been characterized as one strategy that may be useful. However, most benefits in the form of insurance or vacation time are standardized and cannot be prorated based on hours at work.
Certainly, employers can insist that vacation time be based on some formula reflecting hours worked. Health and life insurance benefits on the other hand should not be used in this manner. Pay-for-performance seems to be an excellent strategy for determining compensation and reducing costs.
According to Bohlander and Snell (2004, p. 388), companies are well advised to use value-added compensation by "evaluating the individual components of the compensation program to see if they advance the needs of employees and the goals of the organization."
At the company with which I work, pay-for-performance standards have been adopted to reward employee effort and performance. Highly motivated and ambitious workers appreciate these rewards. However, I have had to terminate employees who did not put ou
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