Developing An Employee Compensation Plan For Your Organization

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"When we give cheerfully and accept gratefully, everyone is blessed." -Maya Angelou

Now, before we examine three components to consider when making a compensation plan, I want you to know there are serious tax implications in regard to each of these areas.

Let me be clear: if your business needs any help assessing the state of your employee compensation methods, and the ensuing tax implications, please give me a call. 

I'd love to schedule a meeting and discuss how your business can help employees while staying within IRS guidelines.

Salaried v. Contracted

This may seem like a simple clarification, but many businesses skirt the issue. Some of those companies? They're now in a mess that directly affects their employees ... or are they contractors? Who knows.

It's also important your business adheres to federal and state laws about minimum wage, paid leave, sick days and so on. There might be laws your team is unaware of, and it's one more thing to get up-to-date on before hiring new employees. This might be more of an HR lawyer conversation, but it's another topic I'd love to at least begin to address with you.

Lynn and his late wife Jackie Sharp, owned Eastern Onion Singing Telegram Service in Salt Lake.  It was a national operation.  Many of the offices had performers listed as independent contractors.  Lynn says, "We had our actors and actresses as full employees.  It was cleaner that way!"

The Case for Transparency

Many organizations, to avoid arguments surrounding wage and pay gaps, are becoming more transparent about salaries across the board.

I'm not sure where your business stands on the "transparency" side of things, but it's important each of your employees feels valued and taken care of. In addition, you need to have some sort of system in place for raises and promotions.

Think about it.

Employees work better when they have set goals they're working toward. If they have, from 'day-one' of employment, clear goals charted out to earn raises and promotions, it will give them something to strive for each day at work.

There's a word for that: motivation. And it helps grow businesses fast.

Your Employees. Their Equity.

More and more start-ups are examining this unique way to attract talent and retain quality employees over the long haul.

Allowing employees a percentage of equity in your company will make room for some serious skin in the game. The concept might seem risky, but if you're seeking intense growth and talent for your business, then think about spreading some equity love.

The end result is that you're conveying trust in the employees you worked hard to hire ... and want to keep.

Do you implement any of the aforementioned compensation strategies? What's working well for you? What could change?

I'd love to hear your feedback, especially if your business is on the forefront of income innovation.

I'm grateful for our chance to serve you and your business -- and we are dedicated to its success. Which means we are here to keep you focused on what really works.


BE THE ROAR not the echo!
 

Warmly,

Janet Behm
Utah Real Estate Accountants
(801) 278-2700

 



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