Work Street Work City, Work State Work ZIP
Topic 1 Strategic Perspectives
Exercise 2 , Page 18 In terms of the pay system which was introduced at the Screaming Tale Restaurant, I reckon that they didn’t fulfill the criteria for effectiveness which was described in Compensation Notebook 1.1, especially the following goals of the reward and compensation system should accomplish: • Promote achievement of the organization’s goals. • Attract and retain qualified individuals. At the most basic, the purpose of establishing an effective compensation system is to help business reaching their goals. Obviously, the amount of pay in this restaurant is too limited to attract even to retain the appropriate staff varies with the other restaurants can offer, such as wages, tips and other rewards. Unlike banks, other traditional business or government, to some extent, Service Industry especially this restaurant can not offer job security, public esteem or much more benefits to attract employees easily. Thus the restaurant may has to choose to provide relatively high level of salary in order to attract high-caliber employees, so that making the business to obtain a higher level of customer satisfaction. The more customers rushing in to the restaurant, the more profit they can contribute. This makes the business enter into a healthy circle. • Be seen as equitable. The restaurant eliminated not only the server’s compensation, but also other rewards. As there’s no other form of reward being provided to the employees, they could only be paid by tips which can be considered the only compensation system in the restaurant, thus staff can’t get their minimum wage under this inequitable reward system. Meanwhile, under the same level of work, the tips may be various depend on the different customers’ personalities or values. • Comply with the law. Under the Employment Standard Act 2000, most employees are eligible for minimum wage, which is the lowest wage rate an employer can pay an employee. Salary received as tips doesn’t count toward the minimum wage. With the rapid changing work environment, it is crucial for employers to continual evaluate the effectiveness of their rewards and compensation system. Admittedly, we can’t expect the compensation system in the restaurant could achieve all these criteria at the same time, such as equitable, however, for those organizations with an equitable reward system will obtain a competitive advantage, as well as raising a positive impact on employees’ performance instead of cause the employee turnover or reduce work motivation. In that case, from my standpoint, it was not an effective system for the restaurant, and it was unfair to those servers.
Any possible disadvantages or negative consequences for the employer?
The Screaming Tale Restaurant, as a small businesses, although the idea of the volunteer program might seem irresistible when employers are shorthanded, they must also consider the disadvantages by only utilizing volunteer staff. • Extra