Compensating Employees Essay

The compensation will show why some employees are paid particular amounts, issues concerning bonuses and why it may demand pay raise to some employees. The Danish Companies Act of 2010 developed Maersk compensation philosophy. This act states that before any organization can come up with an agreement to direct incentive pay with a person in the company's management, guidelines need to be set based on the incentives pay for the members of the management board. According to Maersk, the instructions should be voted in the board meetings or even decided by the consensus of the executive officers. The approach the organization chooses to take in providing payments and the exact agreement by the employees and the employers becomes the compensation philosophy of that specific company (Vallejo Peña, 2016).

Salary survey helps an organization in building personal loyalty. Additionally, the surveys enable the company to retain tenured employees (Katona & Sarvary, 2014). The salary survey adds more value to the organization by allowing it to set the pay standard. It’s again in these surveys that organizations can compare its strengths with those of other organizations. The salary survey also provides useful benchmarking information which can help other companies to compare salaries and benefits given to their employees. To mark the end of the essay, the compensation philosophy of Maersk Company should be emulated by other companies. Employers should consider the influence of the market when determining the pay. Companies should give some discretionary benefits which have been theoretically proved to increase the productivity of the employees.