Question

Amongst rank and file employees, how should we distribute compensation? What are some best practices? What compensation systems do you think are best and why?

Answer 1

Rank and File employees are reponsible for the day-to-day operations of a business. Though they follow the least hierarchy in an organization, they end up being the backbone and soul of the organization. The rand and file employees dont plan but execute.

Compensation to rank and file employees are often done based on their daily targets. They work based on the instructions that are being passed onto them and execute the same. Compensation to rank and file employees should be based on their contribution to the organization whilst they are based on the low level skill set currently.

Best practices of compenstion to rank and file employees would be to give them good amounts of share in profits. Being the front line of the organization they will have to be kept motivated at all times.

The following compensation system are best for rank and file employees:

1. Bonuses
2. Profit Sharing
3. Merit Pay
4. Insurance Cover
5. Commissions etc.