Employee compensation is not a topic you should gloss over. Your team wants to get paid fairly and in a way that matches their performance and duties. While compensation plans might seem cut and dry, there's no one-size-fits-all option.
With this blog, we aim to clarify standard compensation plans and give you an idea of how to pick the right one for your team.
When you pay your employees hourly, you're paying them for the time they spend working. It's as simple as that! You set an hourly rate, and your team gets paid for how long they're on the clock. Adjusting sales compensation plans for hourly workers is pretty easy as well.
Some view hourly workers as expendable, but it's a desirable compensation plan for many because it means employees are nonexempt from the overtime provisions of the Fair Labor Standards Act. It's an excellent option for money-motivated workers who want to take advantage of available overtime hours. Those who have fluctuating availability usually prefer it over other compensation plans. Know more about adjusting sales compensation plans by visiting this website.
With a straight salary compensation plan, your employees get paid a set amount. Usually, you establish an annual salary, and your team isn't eligible to receive overtime. So, what's the benefit of salaried plans?
Generally, salaries provide more flexibility in scheduling and where they work. With this plan, no one has to log hours, and there's more freedom in how people want to work. Most employees who aren't involved with direct sales will benefit from a straight salary compensation plan.
With salary and a commission, your team gets the best of both worlds. The salary provides some security and ensures that your employees get paid even during slow periods. Meanwhile, the commissions motivate them to contribute more to the bottom line.
Your sales team will usually prefer this plan. It rewards performance and provides plenty of room for growth. Adjusting sales compensation plans is a breeze with the right tools. As a result, you can continue to push your team further.
Those are just a few of the most commonly used plans. What's right for your company will depend on many factors. Have an open discussion and determine which option will reward your team the most.
Read a similar article about company culture in sales here at this page.