A salary is a set monetary compensation given to an employee by an employer as payment for work performed. Usually, the payment can be estimated as an agreed amount per task performed, an hourly rate, or even based on an easy-to-measure measure of labor performed. But how should an employer measure the value of his or her employees?
Most businesses provide their employees with monthly salary checks. This can include overtime and bonus payments. But the most common way to calculate the value of an employee is by comparing his or her salary with other employees in the same position. Some companies prefer a formula that involves both the salary and a similar number of hours worked, while others prefer to use one formula for all employees.
When comparing wages between employees, keep track of the following: the age of the employee; the length of time that the employee has worked for the company; and any bonuses, promotions or stock awards that have been received. If an employee receives a large or small amount of money every month, such as a bonus, then the value of the bonus will affect how much an employee's salary is.
To be considered for an offer to participate in a wage package, the employee must have a minimum amount of experience. Experience indicates the number of years that an employee has worked at a particular job. Experience also helps an employer determine how the new hire will fit into his or her business model. If the employer expects a new employee to bring a specific skill set to the table, then a certain level of experience is necessary.
Also, if the employer is looking to fill a vacancy quickly, then a new hire will not be considered unless the company is willing to do so. Companies with a tight staff often prefer to hire a fresh applicant than wait months for an existing employee to expire.
Once an employee's salary has been determined, the employer will need to determine what additional financial rewards are due to the employee. The employee will usually receive a weekly, bi-weekly, monthly, quarterly or annual payment that takes . . . . . . into account the amount of money earned as well as bonuses and other benefits received. The best way to determine the value of a new hire is to pay careful attention to how other employees within the organization are being paid and the salary they receive.