The recent trend in the corporate sector of the United States of America is hiring third party employees to work carry out significant parts of the entire operations. The trend is even stronger among the multinational companies which hire employees from multinational consultancies. The aim of the paper is to study the employee packages and post employment benefits these consultancy companies offer to their employees deployed with their client companies. The increasing importance of consultancies in the American labor market is evident from the fact that the leading consultancies are public limited companies earning huge revenue by serving these clients. The consultancy company, Adecco USA, the American arm of the Swiss consultancy group, Adecco Group forms the crux of the study (adeccousa.com, 2018). The consultancy is listed on the Swiss Stock Exchange and operates in several countries. The paper would delve into the compensation of the consultancy group.
The present compensation plan of Adecco for its employees stands on three pillars namely, finance, human resources and legal. The financial part of the compensation stresses on the wages or salaries which the consultancy pays to its employees which include employees both deployed with the consultancy and its clients. The consultancy clearly mentions that it stresses on paying employees high and legitimate salaries to ensure that it can attract high efficient and qualified manpower. An evaluation of the existing policies of paying employee high financial compensation serves four purposes. First, as pointed out, it helps the consultancy attract qualified manpower (Lu & Gursoy, 2016). Secondly, high pay packages enable the company to retain employees for longer period because these high packages act as motivating factors for the employees. The third benefit is the outcome of the first two benefits. The power of Adecco attract and retain highly qualified manpower enable the consultancy project a positive and strong employee image in the corporate sector of the US. This image of the company enables it to attract more companies from diverse sectors to which it provides staffing services, thus earning more revenue (Bakker, Demerouti & Sanz-Vergel, 2014). This high compensation strategy is appropriate for Adecco because it helps earn more revenue and expand its business. The fact is evident from the presence of Adecco in several countries like the United Kingdom and the US. The effectiveness of the financial compensation packages of Adecco is also evident from the clientele the company enjoys from diverse companies. Thus, it can be evaluated from the discussion that Adecco US offers a legitimate compensation plan.
The second pillar of Adecco’s compensation plan consists of human resources aligned with its financial compensation packages. The consultancy’s human resource plan stresses on preventing of employee burnout. The firm instead stresses on the organizations to roll out innovative salary packages to motivate employees to perform higher (O’Brien, 2017).
The third pillar of the compensation plan of the Adecco is aligning human resources compensation with the laws of the United States of America. An evaluation of this legal aspect of the compensation policies of Adecco is evidence of the company’s law abiding nature. The company follows the minimum wage rate of $ 7.25 per hour as per the latest directives issued by the United States Department of Labor (dol.gov, 2018).
Thus, it can be evaluated from the above discussion that the compensation policies of Adecco are appropriate for the highly competitive labor market of the United States. This is because the country is one of the most competitive economies in the world having a large number of employers. That is why there are large numbers of staffing companies which provide these companies with manpower. Adecco would lose its manpower to its competing consultancies if it fails to apply an efficient compensation policy like its present policy. However, upon evaluation of the three pillars one can ascertain that the compensation policies stress only on the financial aspects of employee compensation (Schuler, 2015).
One can also point out that today non-financial benefits like work-from-home facilities also play significant roles in enhancing employees’ job satisfaction and retention. Adecco generally remains silent on these non-financial benefits mandating its employees to follow the work policies of the organizations where they are deployed. The employers do not provide the employees of Adecco equable promotional opportunities as their on-roll employees. This results in lack of job satisfaction which makes these outsourced switch jobs. Thus it can also be emphasized that Adecco must stress on improving the non-financial compensations of the employees working under its payroll deputed with its clients (adeccousa.com, 2018).
The most beneficial ratio of internal and market consistent compensation system of Adecco would differ from industry to industry. The consistent payment packages employee deputed at multinational companies would be greater than the ones working with smaller companies. The ratio depends on factors like the size of the companies, the qualification of the employees and so on. Hence, there is no standard ratio which Adecco has to maintain between its own internal compensation policies and market standards (Al Ariss et al., 2014).
The current pay structure of Adecco in the United States of America is aligned to recognize the contributions of the employees while doing their jobs. As pointed out, the consultancy serves companies of various sizes and from different industries. The company serves both multinational companies and local companies. An assessment of the employees’ pay structure shows that the consultancy provides salaries well above the standard hourly rate of $ 7.25. It pays more salary to employees working under sales profile than the ones employed in the back office positions. This is because the sales personnel work under more pressure to fulfill their monthly targets and experience high levels of job stress. The higher compensation acts as a motivating factor for these personnel and prevents them from being experiencing burn out (Hakanen & Bakker, 2017). Adecco is one of the largest international chains of consultancies present in scores of nations and provides multinational companies with staff. Average monthly salary recruiters in the US pay $ 40730 approximately. The total payment structure consists of salary, bonus and even profit sharing for certain high profile jobs. Thus, one can infer from this salary packages that Adecco pays due importance to the contributions of the employees and provide them with legitimate compensations as per their job responsibilities (Jackson, Schuler & Jiang, 2014).
Adecco sponsors retirement plans and health insurance programs for its employees. Reviews show that as far as the retirement plans are concerned, they are lengthy and the reimbursement procedure is often very bureaucratic. Adecco provides various types of retirement and health insurance plans like direct deposits, select paid holidays, short-term disability insurance and affordable medical coverage plan. However, the consultancy remains silent on details of these retirement benefits. A strong competitor of Adecco in the US, Kelly Services provides range medical benefits like health insurance and life insurance programs. Another strong competitor of Adecco, Alp Consulting too mentions about compensations like employee benefits. However, it too remains silent about the details. It is clear that the competing staffing companies Alp and Kelly Services offer similar retirement and health insurance plans. Thus, Adecco must offer better retirement and health insurance plans compared to its competitors to retain its employees.
It is recommended that Adecco must pay equable retirement and health insurance benefits to its employees deployed with its clients. The companies often pay more structured and increasing compensation to their on-roll employees compared to their off-role employees. The consultancies too remain silent in the case of retirement benefits of these employees. Adecco should mandate the client companies to offer similar retirement compensations to its employees whom they employ. This initiative would help Adecco to differentiate its retirement and health insurances benefits from its competitors. This would enable Adecco to acquire more highly qualified employees and even steal employees from its competitors.
Conclusion:
The above discussion clearly shows that consultancies should pay attention towards offering better compensation to their employees. They should ensure that their employees receive equable payments and professional growth opportunities. They should ensure that the employees deployed with their clients get equal compensation as the on roll employees of the latter. The consultancies like Adecco should stress on offering both financial and non-financial compensations to their employees. The financial compensations employees get can consist of salary and retirement plans. The non-financial compensation can consist of health insurance plans and career growth opportunities. These consultancies should ensure job satisfaction to their employees to ensure longer retention of them. These strategies of employees would ensure long term generation of revenue by providing talented staffs to their client companies.
References:
Al Ariss, A., Cascio, W. F., & Paauwe, J. (2014). Talent management: Current theories and future research directions. Journal of World Business, 49(2), 173-179.
Alp Corporate Group – Services and Offering. (2018). Alpconsulting.in. Retrieved 5 March 2018, from https://www.alpconsulting.in/alp-corporate-group.html
Bakker, A. B., Demerouti, E., & Sanz-Vergel, A. I. (2014). Burnout and work engagement: The JD–R approach. Annu. Rev. Organ. Psychol. Organ. Behav., 1(1), 389-411.
Benefits and Perks | Kelly Services US. (2018). Kellyservices.us. Retrieved 5 March 2018, from https://www.kellyservices.us/us/about-us/work-at-kelly/corporate-branch-benefits-and-perks/
Can raising hourly wages increase employee retention? | Adecco. (2018). Adeccousa.com. Retrieved 5 March 2018, from https://www.adeccousa.com/employers/resources/increasing-hourly-wages/
Hakanen, J. J., & Bakker, A. B. (2017). Born and bred to burn out: A life-course view and reflections on job burnout. Journal of occupational health psychology, 22(3), 354.
Jackson, S. E., Schuler, R. S., & Jiang, K. (2014). An aspirational framework for strategic human resource management. The Academy of Management Annals, 8(1), 1-56.
Lu, A. C. C., & Gursoy, D. (2016). Impact of job burnout on satisfaction and turnover intention: Do generational differences matter?. Journal of Hospitality & Tourism Research, 40(2), 210-235.
Minimum Wage. (2018). United States Department of Labor. Retrieved 5 March 2018, from https://www.dol.gov/general/topic/wages/minimumwage
O’Brien, K. (2017). Employer branding through social Media platforms in financial consulting companies.
Schuler, R. S. (2015). The 5-C framework for managing talent. Organizational Dynamics, 44(1), 47-56.
Staffing Agency Benefits and Pay | Adecco. (2018). Adeccousa.com. Retrieved 5 March 2018, from https://www.adeccousa.com/working-with-a-staffing-agency/staffing-agency-benefits-and-pay/
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