Management Paper on Employee Total Rewards Model

Executive Summary

Where there are multiple employment opportunities available for a particular position or person, the most important decision can be determined by the total reward model of employee compensation. Various compensation methods have been recommended, both monetary and non-monetary. In deciding whether to take up a new job opportunity, the decision to choose one job over another depend on the benefits associated with each job as well as the cost of living in the location for the new job. After evaluating the available opportunities, the best choice would be to work in a new job at Stamford, CT, where the costs of living are low and the new benefits are enhanced. The new job provides sufficient monetary and non- monetary benefits compared to the current job hence would be worth taking.

Employee Total Rewards Model


In organizations, one of the biggest HR challenges is employee turnover. Organizational management have to figure out exactly what keeps employees loyal to their organizations, and one strategy to aid this process is the use of total rewards model (World at Work, n.d). The model entails a consideration of all the benefits that an employee can gain from a specific employer. For my current and proposed jobs, the best decision would be that which enables me to consider the benefits from each of the jobs on offer as well as the costs of living in each of the job locations. The total rewards model emphasizes the importance of five factors of remuneration including monetary compensation, benefits, work – life – balance, performance and career development prospective for every individual (Anku- Tsede, 2013). The job that gives the maximum summative benefits will be considered the job of choice.

Total Rewards Model

The first factor under consideration for the total rewards model is the compensation. Employee compensation can take the form of fixed pay, short and long-term incentive pay, variable pay such as bonuses (Anku – Tsede, 2013). The fixed pay for my current job is $ 65,000 while the proposed job has a fixed pay of $ 80,000. The bonuses are part of the variable pay for each of the companies. The current job offers a maximum bonus of 20% of the base salary while the proposed one offers a maximum of 15% of the salary. The implication is that for any given month, the maximum pay I can receive from the current job is $ 78,000 while the minimum I can receive from the proposed job is $ 92,000. The compensation for the proposed job is therefore better than that of my current job. The job benefits should be comparable to the job description offered for the two positions.

According to Jiang, Xiao, Qi and Xiao (2009), the benefits that can be given by an organization may include health and welfare plans, payment for time not worked and legally mandated job provisions. Remuneration costs are thus key consideration for any organization whereby the total remuneration is calculated as the sum of fixed, variable and benefits (Jiang et al., 2009). My current company provides a medical/ dental/ vision plan of up to $ 150 while the proposed job provides a similar plan but with up to $ 200 in benefits. Furthermore, the proposed job comes with a mandated provision of $ 500 car allowance per month. The current job offers a current merit increase of 4.5% versus 3.5% for the proposed job. With the basic salaries associated with the two jobs, the proposed opening provides a better benefits plan compared to the current job, hence would be my choice.

Besides the monetary benefits in the total rewards model, there are non-monetary benefits that can be used to evaluate a job position. The work – life balance is the first in this category of benefits. The work – life balance associated with the proposed job are likewise better than the current one. For instance, both job offer 15 days of vacation. However, the first job offers 3 days sick off and 7 holidays while the proposed job offers 10 holidays. Aggregated holidays have better impacts on the employee compared to distinctive holidays such as those provided in my current job. Within my current position, flexibility in how I used my holidays is restricted to 7 days. The other three are attached to illness. In the proposed job, the incumbent will utilize their holidays flexibly, and I could opt to set aside 3 days for sick off and then utilize them for something else as the year closes. The current company provides a zoo and OMSI membership for all those who register. The benefits of being a member in any of the organizations is that one can be able to visit the organizations with their family without additional payments. Work – life balance also entails a health and wellness initiative as those provided by the two roles. In the current position, the health and wellness benefit comes in through the free gym on site. On the other hand, the proposed role comes with company paid health club. The health club seems to be a better idea compared to the gym since it gives the employee an opportunity to explore several health systems and enjoy optimum benefits from the company. Moreover, a health club also has the opportunity of addressing specific employee issues rather than generalizing the outcomes of membership to all employees. A company that offers a paid health club would therefore be more attractive to one that offers a gym.

The second non-monetary benefit is career development. Each person seeks an opportunity to grow professionally and a job that provides this opportunity is considered better than one that does not. For instance, the current position does not provide as much career development opportunity as the proposed position. By accepting to work in the proposed position, I will be worthy of a reimbursement towards an MBA. This implies that I will have an opportunity for MBA sponsorship or reimbursement in case I already have an MBA. As an individual seeking sustainable career growth, the proposed opportunity will be opening up more doors by expanding my knowledge and skill. Giving an employee an opportunity to pursue an MBA also means that the employer trusts in their ability to perform taxes higher up their command hierarchy. An increase in the number of followers is also a sign of increased responsibility and thus career development. While working in my current position, I manage only three people. An increase in the number of people under my management is also an indication that my capacity to manage has been noticed.

Performance and service recognition comprise the last category of non- monetary benefits to be considered under the total benefits rewards model. Under this category, the different aspects that should be considered include performance evaluation, having goal specific awards and service recognition awards (World at Work, n.d). The presence of a target bonus indicates the potential for service recognition and awards within the proposed and current position. The amount of bonuses offered in terms of percentage can be deduced to be the value of the recognition experienced.

Cost of Living Comparisons

Besides the total benefits associated with the proposed jobs and the current job there is need to consider the best location to take up the job. The objective is to work at a place where the cost of living is low and thus giving the opportunity to save and invest for later years (Powell, 2016). The proposed job is in Stamford, CT; Washington, DC; Honolulu, HI and San Jose, CA. I could choose to work in any of these locations thus making the best choice is important. For instance, CNN reports that the cost of living in Honolulu is about 5.26% higher than the cost of living in San Francisco Bay, within which San Jose is located. The cost of groceries is 28% more in Honolulu than in San Jose, while housing and utilities are 6% less and 84% more respectively. Transportation costs are 1% less and healthcare costs are 5% less in Honolulu than in San Jose. This implies that Honolulu is more expensive to live in than San Jose (CNN, 2018).

In comparing the city of Stamford and Honolulu, the results indicate that Stamford city is 23.7% less expensive to live in. The costs of groceries, housing, utilities and transportation are 22%, 34%, 38% and 16% less than those in Honolulu respectively. Healthcare costs in Stamford are equal to those in Honolulu. Similarly, the living costs in Washington, DC are 20.8% less than the living costs in Honolulu, with all the costs less than in Honolulu. CNN (2018) reports that the costs of groceries, housing, utilities, transportation and healthcare are 29%, 23%, 41%, 20% and 14% less than in Honolulu respectively. From the living costs statistics, it is clear that Honolulu is the most expensive city to live in and the financial remuneration for companies working there should be higher than remunerations of businesses in the other cities. From these reports, the ranking of the cities is from Honolulu, San Jose, Washington and Stamford city from the most expensive to the least expensive to live in as shown in the appendices B and C (CNN, 2018). Stamford would be the best city therefore to live in.


The choice of job location depends on the living costs and the total benefits associated with the job position. Comparing the current and the proposed job positions, the proposed job offers the best financial and other benefits rewards and thus would be the job of choice. The location of choice on the other hand would be Stamford, CT since the cost of living in the area is lower than in the other cities.



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