Running head: COMPENSATION AND BENEFITS 1 Compensation and Benefits Capella University lOMoAR cPSD|3013804 COMPENSATION AND BENEFITS 2 Introduction Java Corp is a domestic cold coffee and tea company. The company is opening up a new office in London, England. Java Corp is planning on filling one executive level position with a U.S. citizen. The term of this initial assignment is two years. With being the new HR manager, it’s my job to design a compensation package for this open position. Key Factors and Decisions to make Regarding Base Pay A few key factors and decisions to take into consideration when regarding base pay is the “person’s experience, qualifications, geographic location, and performance” (Compensation Equity Public Policy Issue Statement, 2018). Java Corp will use variety of strategies when figuring out the base pay to make it a competitive workforce. Some of those strategies are “market competition, employer size, whether the employer is public or private, level of product demand, and industry” (Compensation Equity Public Policy Issue Statement, 2018). When living in London, England all of these strategies are good to take into consideration when figuring out the pay because it’s an expensive area to live. “There’s no getting away from the fact that London is an expensive city to live and work” (Moving to London, 2019). Living in London, England can be a wonderful and stressful experience. “The average salary in London is £34,991 per annum, which is the highest of all big cities in England” (Average Salary London | Onaverage.co.uk, 2021). This would be $39,196.92 in US dollars. “The average London house price in May 2018 was £478,853 (or $629,788)” (HM Land Registry, 2018). The prices start to change and get a little lower once you’re away from the center of London. The price for a one bedroom apartment in 2017 was around £1,250 (or $1,644) per month. All of these expenses are taken into consideration when developing a compensation package for this open position within Java Corp. lOMoAR cPSD|3013804 COMPENSATION AND BENEFITS 3 “Compensation may refer to the direct and indirect benefits that a worker receives from an employer” (Compensation Equity Public Policy Issue Statement, 2018). Compensation may include salary or hourly pay, benefits, bonuses, incentives, short term disability, and 401k contribution. Most of these components are listed in a compensation package. The compensation package can have many components within it. “Compensation is payment to an employee in return for their contribution to the organization, that is, for doing their job” (McNamara, n.d.). The most common ways that compensation is given is by wages, salaries and tips. The pay scale is always different per person because it all depends on the persons experience, skills, and job position. The pay scale may be different at the executive level because the salary and other benefits are negotiated into the employee’s contract within the company. An executive level employee’s contract could consist of compensation, benefits, supplement benefits, insurance coverage vacation, memberships, bonuses, agreements, perks and special terms of employment. When completing an entire compensation package for employees it’s very important to take all of these things into consideration. Some questions to think about when completing a compensation plan are: What can Java Corp afford and what is the company willing to pay? What is the cost of living in London, England? What are Java Corp thoughts on compensation? What is the value of other executive level positions? What are Java Corp expectations on the executive position? When all of these questions are answered then it’s a good start to a compensation package. These packages can fluctuate for each position and employee that is hired. Analyze legally required benefits and standard benefit offerings for an employee