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HR’s Role in Compensation and Benefits

Show me the money.

Sure, employees work for the love of the job and to build fulfilling careers, but at the end of the day they want a paycheck too. And they want a well-rounded benefits package with health insurance and a retirement plan.

Thoughts immediately turn to human resources when salary and benefits come up, but who exactly in HR is responsible?

Compensation and benefits specialists devise an organization’s salary, bonus and incentive plans. According to All About Careers, small companies likely have a few employees who handle all HR functions. Larger businesses have employees who specialize in one aspect of compensation and benefits, such as payroll management.

Duties are Many, Varied

It’s not an easy job but it is very important, because employee morale is at stake when the topic is compensation. According to The Balance Careers, a compensation manager may have several duties:

  • Develop pay scale and structure
  • Keep competitive pay rates current
  • Ensure that payroll complies with state laws and federal regulations
  • Oversee pay distribution to employees
  • Work with managers to develop employee promotion and retention strategies
  • Oversee compensation and payroll support teams
  • Develop and monitor a department budget

Compensation and benefits experts must understand competitive forces to ensure equitable pay rates. They are key to an organization’s ability to attract and retain employees.

Compensation Manager Skills and Qualities

Not everyone is cut out to be a compensation manager. The Balance Careers lists three qualities that are vital to success. A compensation manager must

  • Be able to effectively explain a company’s pay system and address executive and employee concerns
  • Be able to collect and analyze data to determine the best compensation plan for a company
  • Have a solid working knowledge of math and statistics

Great compensation and benefit plans ensure that good employees are rewarded fairly, which motivates employees to improve performance, notes These plans also are important to attract new talent. Most career-minded professionals apply for specific jobs because of salary and incentive packages. Better compensation attracts better applicants. maintains that compensation managers play a strategic role in striving to balance the needs of the business with those of its employees. And as compensation and benefits are directly linked to market changes, difficult decisions may fall under their authority.

Pursuing an advanced degree like the online MBA in Human Resource Development at Pittsburg State University expands HR expertise, sharpens leadership skills and opens the door to job opportunities in a number of roles including HR director, vice president of operations, senior manager, HR generalist and other management positions.

Learn more about Pittsburg State University’s MBA in Human Resource Development online program.


All About Careers: Human Resources: Compensation, Benefits and Reward

The Balance Careers: What Does A Compensation Manager Do?

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