Leave of absence

What is a leave of absence?

A leave of absence (LOA) is time people can take off from work for extraordinary circumstances. If a company's policies concerning time off, sick leave, vacation, and holidays cover LOA, then the team member on leave can receive payment. Otherwise, the leave of absence is unpaid. While companies may not always compensate people for a leave of absence, they do provide protective benefits, and the person on leave can access their health insurance and accrue vacation days.

read more >
Floating holiday

What is a floating holiday?

A floating holiday is a paid day off that an employee can decide to take on a day of their choosing. It’s called a floating holiday because it can “float” to whichever day the person chooses. Companies usually provide these in addition to the standard paid holidays as a type of benefit.

read more >
Revenue per employee (RPE)

What is revenue per employee?

Revenue per employee (RPE) is a financial metric that measures the average profit each employee contributes. Revenue per employee allows organizations to determine the efficiency, productivity, and profitability of each employee and the company as a whole.

read more >
What is a payroll cycle?

What is a payroll cycle?

A payroll cycle is an administrative process of paying employees recurring compensation.

read more >
What is salary benchmarking? - Salary-benchmarking-Glossary-banner.png

What is salary benchmarking?

Salary benchmarking is the process of evaluating a company’s internal job salaries based upon their external value. Salary benchmarking involves analyzing the main components of each position and comparing these positions to similar jobs in other companies. Organizations primarily rely on compensation surveys, government labor databases, and the assistance of compensation consultants for accurate job market data. Why should HR leaders care about salary benchmarking? Salary benchmarking helps compensation managers create competitive salaries. Though compensation isn’t the only important aspect of a job, it's obviously an essential factor, as everyone…

read more >
What are exempt and non-exempt employee statuses? - Exempt-and-non-exempt-employee-status-Glossary-banner.png

What are exempt and non-exempt employee statuses?

Exempt and non-exempt employee statuses are taken from the FLSA (Fair Labor Standards Act) employee classification system. Exempt employees earn a salary, not an hourly wage. They are exempt from receiving overtime pay and cannot qualify to receive it. Exempt employees make a minimum of $35,568 a year and are generally skilled professionals working in white-collar positions. Doctors, lawyers, accountants, HR managers, and engineers, for instance, qualify as exempt. The different types of exemptions include: Outside salesHighly-compensated employeesComputerProfessionalAdministrativeExecutive Non-exempt employees, in contrast, earn hourly wages. Non-exempt employees must receive minimum…

read more >
What is indirect compensation? - Indirect-compensation-Glossary-banner.png

What is indirect compensation?

Indirect compensation is a type of remuneration that typically encompasses non-monetary forms of payment. Direct compensation includes base pay, bonuses, commission, and incentives. Indirect compensation includes paid time off and overtime pay, as well as benefits that have financial value, but no cash value, such as: Insurance plansParental leaveTechnological devicesStock optionsRetirement planning and financial consultations Except for government-mandated benefits, organizations can choose which forms of indirect compensation to incorporate.  Why should HR leaders care about indirect compensation? Understanding indirect compensation is essential for HR leaders. During the hiring process, candidates…

read more >
What are supplemental wages? - Supplemental-wages-Glossary-banner.png

What are supplemental wages?

Supplemental wages are payments that employers provide to employees in addition to their regular wages. While regular wages are comprised of hourly wages or a monthly salary, supplemental wages can include earnings such as: Severance payBonusesCommissionsOvertime payAwardsVacation payAccumulated sick leave paymentsRetroactive pay increases As an enhancement of the basic compensation plan, supplemental wages are subject to specific tax regulations. By law, employers potentially have to withhold tax from supplemental wages differently than from regular wages. Withholding tax from supplemental wages depends on: The total amount of supplemental wages paid annually—if…

read more >
fringe benefits

What are fringe benefits?

Fringe benefits are supplementary forms of payment that employers provide employees in addition to a salary. While employees must receive government-mandated core benefits, fringe benefits afford additional assistance to employees in their day-to-day lives. Employers can deliver fringe benefits in various forms, such as: Gift cardsSavings bondsCompany carStudent loan refinancing programCritical illness insurancePet insuranceProperty Fringe benefits are cash equivalent and can be qualified as taxable, partially taxable, non-taxable, or tax-deferred. Depending on the number of hours worked, companies also sometimes offer fringe benefits as an incentive to high-performing freelance workers. …

read more >
compensation plan

What is a Compensation Plan?

A compensation plan is a payment package designed to attract and retain employees. A basic compensation package consists solely of a salary or wages. A more comprehensive compensation could include additional benefits such as bonuses, perks, commission, health insurance, or retirement investments. Compensation plans involve offering fair and competitive payments that simultaneously align with the company budget and promote business success. https://www.youtube.com/watch?v=xdicz6u06ro&list=PLy3JTofSJZvst0HUOnqPHjl_88eIVlvaN&index=3 Why should HR leaders care about a compensation plan? Compensation packages that adequately reward employees for their hard work can drive business profit. A thorough, effective compensation plan:…

read more >
Employee benefits

Employee benefits

Employee benefits are a form of compensation that employers provide (along with a salary) to create a well-rounded, attractive payment package. Employee benefits vary, depending on the relevant government labor laws. In the United States, each state has its own regulations regarding employee benefits. Government-mandated benefits include: Social SecurityHealthcare or Medicare FMLA or time off for family In addition to government benefits, employers often offer: Paid time off for holidays, vacation days, and sick leaveHealth and life insurancePersonal leaveDisability insuranceRetirement plans Generous employers may add complementary benefits to create a more…

read more >