Compensating employees

Learn to design an effective compensation strategy to attract, retain and motivate winning staff, and to budget effectively for HR expenses.

Start-ups may use benefits to enhance compensation and attract and retain employees.

A company’s compensation structure must be competitive to attract and retain employees while remaining cost effective.

Founders need to know how to allocate share interests among those contributing their time and talents to the venture.

Incentives are critical to retain those employees who are essential to the company’s success. Recognize the vital contributors and make sure they know they are valued.

Profit-sharing plans provide bonuses to employees based on a certain percentage of the company profit.

To reward and retain key employees working on long-term projects, many companies turn to bonuses for project completion or achievement of key milestones.

One of the incentives small and fast-growing companies can offer employees and executives is the option to purchase company shares or stock options.

Most technology start-ups employ some combination of base salary and performance pay to get the best out of their key executive, sales and operations staff. Performance pay may be based on indicators such as sales, the number of customers served, the number of units produced, lines of code written, overall company profits or other measurable indicators.