Compensation and Benefits Plan

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Formulating an effective compensation and benefits plan is a crucial business process, more so in an era that companies are competing to attract, motivate, and retain the best talent. In other words, firms with better compensation and benefits strategies are considered to have a competitive advantage (Tsede & Kutin, 2013). As such, this paper seeks to formulate a compensation and benefits plan for Muleskinner Limited, a logistical distribution company.

Background of Organization

Muleskinner Limited is a logistical distribution firm that employs approximately 150 employees. The company engages in the transportation of all classes of supply except CL VIII. The business also receives all classes of suppliers in its warehouse except CL VIII.

Compare/Contrast of Industry

Companies in the logistics industry have different compensation and benefits plans that they use to attract, motivate, and retain talent. The table below outlines the similarities and difference of salary and benefits packages of three logistic firms (PayScale, Inc., 2018):




DHL Express

Average salary-$64,000

Ø Operations manager-$70,021 on average

Ø Operations supervisor-$51,777 on average.


Company sponsored trips/vacation.

Life insurance/disability

Casual clothing/work environment.

Remunerated sick leave.

Learning/training/coaching/certification recompense.

Cell phone


Average salary- $71,000

Ø Operations manager-$71,327 on average.

Ø Operations supervisor-$54,926 on average.



Company sponsored trips/vacation.

Life cover/disability

Casual clothing/work setting.

Remunerated sick leave.

Learning/training/coaching/certification recompense.

Company pension plan.

United Parcel Service (UPS)

Average salary- $70,000

Ø Operations manager-$80,856 on average.

Ø Operations supervisor-$66,482 on average.


Company sponsored trips/vacation.

Life insurance/disability

Casual clothing/work environment.

Remunerated sick leave.

Learning/training/coaching/certification recompense.

Company pension plan.

Stock purchase plan.


Keeping all employees engaged is a challenging task for most organizations because workers are likely to be driven by different needs (San, Theen, & Heng, 2012). Therefore, effective engagement strategies involve being relevant to employee desires and taking into consideration their diverse needs. For instance, recent human resource studies have revealed that there is a difference between age group’s preferences for benefits, especially when it comes to financial remuneration provided and the quality of incentives (San et al., 2012). In other words, in the 21st-century workforce, individuals’ view of benefits vary (Lipman, 2013). For others, assistance such as health care, childcare, eldercare, and retirement plans are important. However, for others, such as the millennials, short-term benefits such as flexible hours and learning and growth opportunities are the top priorities (Bussin & Van Rooy, 2014). Therefore, it could be argued that employees can be kept engaged using a holistic compensation and benefits plan that provides the total package, including the flexibility of that bundle, which helps in leveraging employee differences.

In line with the above argument, employees can be kept engaged by creating a total reward program that encompasses aspects such as compensation, assistance, work-life effectiveness, appreciation, performance management, and employee growth (Tsede & Kutin, 2013). Focusing on such facets will can help a company come up with a portfolio consisting of different benefit plans that ensure all workers’ needs are recognized (Tsede & Kutin, 2013). For example, a benefits package that includes, overtime pay, stock option, flex hours including seasonal hours, and feedback and continuous improvement initiatives can cater for employees who value financial and non-monetary benefits. Finally, according to recent Gallup research, investing in staff recruitment process, strengths, and wellbeing can go a long way in keeping employees engaged (Gallup, Inc., 2013).

Proposal for Benefits

Below are some of the initiatives that Muleskinner Limited should consider including in its benefits program.

Health and wellbeing program

Ø Flexible work arrangements.

Ø On-site fitness center.

Ø Accident insurance.

Ø Medical insurance.

Ø Life insurance.

Finance and retirement

Ø Fixed pay and variable pay based on performance

Ø Financial and retirement coaching.

Ø Profit sharing plan.

Ø Traditional and 401(k) plans.

Education and training

Ø Mentoring programs

Ø Industry-leading training

Ø Company-organized workshop training.

Time off and leave programs

Ø Remunerated vacation and breaks.

Ø Paid sick days and leave plans.

The above proposal is a holistic benefits program that if adopted, can help in engaging employees, more so those with different needs. The proposal includes both hygiene and motivational factors that according to Hertzberg’s two-factor theory are crucial in engaging employees at the workplace (Businessballs, 2018). For instance, the fixed pay, time-off and leave programs, traditional and 401(k) plans, insurance plans, and profit sharing initiatives are hygiene factors that are meant to ensure motivation at the workplace. On the contrary, plans such as education and training programs, variable pay based on performance, flexible work arrangements, and time off and leave plans are motivational factors, which according to Herzberg, are meant to increase motivation at the workplace and ensure employees are increasingly engaged (Businessballs, 2018). Therefore, based on Herzberg’s two-factor theory, the proposed benefits can go a long way in enhancing staff engagement if implemented.


In conclusion, the paper has presented a compensation and benefits proposal that Muleskinner Limited can implement in a bid to enhance employee engagement. More importantly, the paper recognizes that keeping all employees engaged is a challenging task for most organizations because workers are likely to be driven by different needs. Therefore, effective engagement strategies are those that are relevant to employee desires and takes into consideration diverse staff needs.


Businessballs. (2018). Frederick Herzberg - motivation theory. Businessballs. Retrieved from

Bussin, M., & Van Rooy, D. J. (2014). Total rewards strategy for a multi-generational workforce in a financial institution. SA Journal of Human Resource Management, 14(1), 1-11. doi:10.4102/sajhrm.v12i1.606

Gallup, Inc. (2013). State of the American workplace: Employee engagement insights for U.S. business leaders. Retrieved from Gallup website:

Lipman, V. (2013, September 23). Surprising, disturbing facts from the mother of all employee engagement surveys. Retrieved from

PayScale, Inc. (2018). PayScale - Salary Comparison, Salary Survey, Search Wages. Retrieved from

San, O. T., Theen, Y. M., & Heng, T. B. (2012). The reward strategy and performance measurement (evidence from Malaysian insurance companies). International Journal of Business, Humanities, and Technology, 2(1), 211-223. Retrieved from

Tsede, O. A., & Kutin, E. (2013). Total reward concept: A key motivational tool for corporate Ghana. Business and Economic Research, 3(2), 173-182. doi:10.5296/ber.v3i2.4291

January 19, 2024

Business Economics

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