What makes JMFE an excellent company to work for is that they know that their employees are the strongest assets within their organization and demonstrate that by the care and understanding that they have for employees and their families. They are determined to integrate work with the family life and that is very important in today’s society with a dual income families. It is unquestionable that the strategic compensation strategy that they have developed has given JMFE the reputation of being in a class by itself.Although the costs associated with such a comprehensive compensation package is extremely high, JMFE has continued to sustain their market advantage and increase their profits. There are certain advantages of having discretionary benefits, such as promoting particular employee behaviors that have strategic value.
For example, when employees take advantage of tuition reimbursement programs, they are more likely to contribute to the strategic imperatives of product/service differentiation or cost reduction.Knowledge acquired from job relevant education may enhance the creative potential of employees as well as their abilities to suggest more cost-effective modes of work. Another advantage of offering discretionary benefits is to distinguish itself from the competition. Competitive benefit programs convey a message that the company is a good place to work because it invests in the well being of its’ associates.
Rewarding benefits program will appeal to a large pool of applicants that include high-quality candidates, positioning the company to hire the best possible employees.Discretionary benefits also serve a strategic purpose by accommodating the needs of a diverse workforce, like lowering employee absenteeism by offering child-care services. It is also a tax advantage to companies, which convert into costs savings, money that can be used for research and development. (Martocchio, Joseph J. Strategic Compensation, 2nd Edition); (Sherman, Bohlander, Snell. Managing Human Resources, 11th Edition)When an employer chooses to provide discretionary benefits, there are often additional regulations that go with them, regulations governing how the particular benefit must be administered (www.
parkerhr. com). The Employee Retirement Income Security Act of 1974 (ERISA) regulates the institution and execution of medical, life, disability and pension programs. ERISA was developed to provide protection to employees. It addresses employers’ reporting and disclosure duties, funding of benefits, the fiduciary responsibilities for these plans, and vesting rights.Companies must provide their employees with clear-cut descriptions of their employee benefits plans, updates when changes to the plan are put into practice, annual summary on the financing and operations of the plans, and advance notification if the company expects to terminate the plan. COBRA, enacted in 1985, provide employees with the opportunity to temporarily continue receiving their employer-sponsored medical care insurance under the employer’s plan if their coverage would otherwise be ceased due to termination, layoff, of other change in employment status.((Marrtocchio, Joseph.
Strategic Compensation 2nd Edition,) Choosing what benefits to offer is not a simple matter. Cost is usually the biggest factor, but company size, industry, location, and types of employees also play a significant part. JMFE’s compensation package is centered on the security and welfare of its’ employees and being a successful family-owned company contributed to the design and implementation of their compensation strategy.
The have created a corporate family culture, where each and every employee feels like they are more than just an employee, they are part of something. Happy employees are productive employees, and productive employees generate more profits. JMFE will continue to do what they do for their employees because it is affecting them in a very positive way.
JMFE has become a significant model to other companies that are looking to alternatives, like low cost benefits, flexible hours, telecommuting, and casual dress codes.