Components of compensation
By Jennifer Goupil, P.E.
According to the Engineering Business Institute, which analyzes the offerings of the firms that participate in the Best Structural Engineering Firms To Work For Contest, 100 percent of the firms that participated in the 2005 contest believe they both "compensate staff fairly and equitably for the work they do" and "distribute a fair share of profits to staff." However, only 76 percent of the 1,384 employees who participated in the contest last year are very satisfied or satisfied that they are compensated fairly for the work that they do and 66 percent are very satisfied or satisfied with their company’s distribution of the profits. This disconnect could result from a difference of expectations or simply a communication failure.
Digging a bit deeper into the components of compensation revealed that 78 percent are very satisfied or satisfied with their company’s retirement offerings, and 72 percent are very satisfied or satisfied with their company’s practice for compensating for overtime or extraordinary effort, and an additional 66 percent are very satisfied or satisfied with their company’s frequency and amount of raises.
In addition to the typical employee insurance benefits, many firms offer dependant care, accidental death and dismemberment, and long-term care insurance.
Additional offerings include licensing exam fees and annual dues, professional society memberships, conference registration fees, reimbursement for higher education and training, and paid design codes and manuals. Perks include paid cell phones, health club memberships, transportation passes, and parking fees.
Halvorson and Partners, P.C., offer total compensation
By Jennifer Goupil, P.E.
Principal James C. Swanson, S.E., P.E., with Halvorson and Partners, P.C. (HP)—a 31-person structural consulting firm headquartered in Chicago with one branch office in Atlanta—explains his firm’s philosophy for fairly and equitably compensating its employees: "Our employees are the cornerstone of our business. In return for their dedication, [they] should benefit from a generous compensation program. All compensation evaluations are based on the employee’s contribution to the firm over the preceding year and can vary significantly from individual to individual.
Since firm profit is directly attributable to staff performance, at the end of each fiscal year the principals meet to discuss the professional contribution and development of each employee during the past year. Hard work and dedication is generously rewarded by bonuses in both cash and 401(k) contributions." HP also currently offers substantial benefits, including a medical PPO; prescription drug card; and dental, vision, accidental death and dismemberment, and life insurance. Long-term disability insurance and long-term care insurance (which is portable!) are offered as well. Additionally, the firm contributes to each full-time employee’s monthly insurance premium.
In addition to paying for part of the S.E. exam refresher course, licensing exam fees, all engineering license fees, each employee’s membership in two professional societies, and many professional seminar and conference fees, employee perks include a transit program, monthly contribution toward gym fees, and athletic team sponsorship.
By Saman Chaudry
If you are able (and lucky enough) to find qualified candidates for your critical job openings, make sure to do your due diligence before extending an offer. Before making an offer, make sure you outline all the components that make up a candidate’s compensation package so that you can make an offer that will get accepted. These include (but aren’t limited to) the following: Base salary—Is the candidate compensated with a base salary or on an hourly basis? Is he or she compensated for overtime, and if so, at what rate? Bonus—What was the candidate’s bonus for each of the past three years? How is the bonus determined? A candidate may forfeit the current year’s bonus by joining your firm and you may need to recognize this loss with a signing bonus.
Health insurance—How much does the candidate pay out of pocket for coverage? Ask if the insurance includes health, dental, and vision; if any deductions are pre-tax; and what the cost is to cover dependents or a spouse.
401(k)—Does the company offer a match? If so, how much and what is the vesting period? Vacation/sick time—What does the candidate receive currently for both vacation and sick time? Other compensation—Does the candidate receive any other compensation, such as a car allowance, tuition reimbursement, or gym membership, that should be considered? Understanding these points in detail will allow you to construct an informed package and should give you the competitive advantage you need to beat competitors’ offers.
Saman Chaudry is a principal with ZweigWhite in San Francisco. She can be contacted at firstname.lastname@example.org.