Bonus & Incentives

Stock Options

Employee salary, bonus, incentive and stock option programs should be reviewed or audited annually to determine their effectiveness, competitiveness and legal compliance.

Following are key questions to ask in this employee compensation review process.

  1. Has the company recently changed its business strategy? If yes, has the executive management compensation plan been reviewed to determine if it supports the new strategy?

  2. Has the company recently changed its sales strategy? If yes, has the sales compensation plan been reviewed to determine if it supports the new strategy?

  3. Has the company been experiencing rapid growth in business volume and/or employment? If yes,

  4. Has there been problems with recruitment or retention of employees and executive management due to inadequate employee compensation or financial rewards?

  5. Has compensation been properly tied to individual, team and company performance factors?

  6. Are you comfortable that supervisors and managers are doing a good job of setting employee performance standards, measuring performance and rewarding performance? If not,

  7. Are you satisfied with the information that you have about competitor compensation and benefit practices? Are you interested in locating additional sources of survey information and/or conducting a custom survey?

  8. Have you audited your compensation practices for compliance with state wage orders, FLSA and EEO (Title VII, Equal Pay Act, etc.) statutes in the last few years?

  9. Does employee salary and bonus reflect changes in job duties as they evolve?

Personnel Systems Associates can assist you in a thorough audit of all employee compensation policies and practices, development of compensation strategy, and development of improved salary, bonus, incentive, profit sharing, and stock option programs. Such an audit would include detailed questions related to each of the above issues and would typically include inspections of compensation related documents, compensation policies, computer analysis of payroll and personnel records, and interviews with key management personnel.

As of: 6/23/05