REVISION: Task on Sparkit Technology

Revise the attached essay according to the below instructions. Basically, the calculations need to be checked and updated as the teacher found some issues with them. Please use a different color in the sections you will revise. It should not be longer than 300 words or so.

Dear Freelancer, please fix the task according to the provided comments: “ there is no mention of how the 4 million over the next two years is allocated. The  summary still references an inaccurate bonus of 12% in the text. “

“Check all the calculations to be based off the current headcount and taking into consideration the current budget. This assignment is heavy on the mathematical portion and ensuring I am leveraging ALL the information (which was provided) to ensure the budget is calculated accordingly . The budget cannot just be created , it has to be configured. Given the benefits comparison of sparkit versus competitors . That shows the current budget .”

“The information in the email states the current budget , The sheet I email shows how the current budget is allocated ? My question is – does the new allocated budget counts calculated correctly considering all the information I provided?” 1
Analysis of Sparkit’s Current Total Rewards Plan
Student’s Name
Course
Institute
Professor
Date of Submission
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A. Analysis of Sparkit’s Current Total Rewards Plan
A1. Identifying Gaps
1. Variable Pay
Gap: Sparkit’s annual bonus of 6.25% of total base pay is significantly lower than the
market offering of 10% of base pay.
Hindrance: This has negative effects on employees and can lead to a decline in
satisfaction and engagement. Bonuses are important components of variable pay. It
directly links employee compensation to the performance of the employees and the
company’s success (Fulmer & Li, 2022). In this case, poor bonuses is viewed as
inadequate by employees, and affect their motivation level.
Variable pay at Sparkit is well below market. As such, employees at Sparkit get much
less of their pay through variable pay. This imbalance is likely to create feelings of being
underappreciated and not treated fairly (Bussin et al., 2017). An exit interview comment:
“Poor bonus system when we work so hard to meet company goals is demotivating.” This
statement dramatizes how bitter it feels when efforts from employees are not matched by
corresponding pay.
2. Benefits
2. Benefits
Gap: Sparkit offers a less competitive medical plan with employees covering 30% of
the costs, compared to the market where employees cover only 10%.
Hindrance: The resulting dissatisfaction, coupled with financial stress, is a prime
reason people leave an organization. This financial burden is particularly challenging for an
employee with a family or a serious chronic illness (Fulmer & Li, 2022). The exit interview
feedback included comments such as, “Yeah, we have benefits at Sparkit, but they feel kind
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of basic and outdated.” This shows that employees find the benefits not only weak but also
behind the times compared to what other companies offer.
One major reason attributed to this attitude is the cost of medical benefits, which is
very high for employees. When employees feel they are at a financial disadvantage with their
employers, it can lead to additional stress and lower job satisfaction (Bussin et al., 2017).
This forms one of the main reasons for job dissatisfaction and seeking other employment
opportunities.
3. Well-being
Gap: Sparkit lacks key well-being benefits like paid parental leave and flexible work
options, which are commonly offered in the market.
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Hindrance: The absence of these benefits will affect the employees’ work-life
balance and general well-being, prime importance to job satisfaction and retention.
Most employees nowadays, value a healthy balance between their professional and
personal lives (Khorrami et al., 2019). Well-being benefits, such as paid leave for
parents and flexible work arrangements, are imperative to support workers.
Another key benefit omitted is paid parental leave. For those starting or expanding
families, the absence of paid parental leave is really felt. Without paid parental leave,
employees have to choose between earning a living or spending precious early days
bonding with their new-borns. This can create financial hardship, which, coupled with
emotional turmoil (Day, 2016). For example, the following comments about the lack of
paid adoption and paid parental leave benefits from exit interviews, such as “My partner
and I are hopeful to adopt, but there are no adoption or paid parental leave benefits at
Sparkit. This is a big financial consideration for our family”. This point out the
importance of benefits in employees’ decisions.
A1a. Description of Gaps and Their Impact on Retention
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Variable Pay: The lower bonus percentage compared to the market can result in
decreased motivation and engagement. This is because employees feel their efforts are not
adequately rewarded (Day, 2016). This disparity can lead to higher turnover rates as
employees seek better compensation packages elsewhere.
Benefits: High employee contributions towards medical plans at Sparkit cause
financial strain. This will particularly impact employees who need advanced, resourceintensive healthcare (Ducie, 2019). They are thus forced to quit their jobs at Sparkit to seek
employers with better health care benefits.
Well-being: Poor paid parental leave and flexibility in work options could result in a
disadvantageous work-life balance. Employees seek to shift from Sparkit to other companies
offering such benefits.
A1b. Strong Areas in Sparkit’s Total Rewards Plan
Vacation and Sick Leave: Sparkit offers up to 4 weeks of vacation and 2 weeks of
sick leave, based on tenure. This is competitive and provides employees with a great deal of
time off for rest and recovery.
401(k) Match: Sparkit matches 2% in the 401(k) plan. Though below the 6% market,
it still is a benefit representing a great advantage to one’s security in the long term.
B. Revised Total Rewards Plan
B1. Recommendations for Improvements
Variable Pay:
Solution: Increase the annual bonus to align with the market rate of 12% of base pay.
Justification: Enhancing the bonus structure will boost employee motivation and engagement
(Ducie, 2019). Employees will feel more valued and fairly compensated, which can
significantly improve retention.
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Recognition:
Solution: Implement a recognition platform similar to the market’s “GreatJob” platform.
Justification: A recognition platform enables frequent, peer-based recognition of the
contribution made by employees (Ducie, 2019). This fosters a positive and supportive
workplace culture that enhances employee satisfaction and retention.
Well-being:
Solution: Introduce paid parental leave (12 weeks) and flexible/hybrid work options.
Justification: These benefits support employees’ work-life balance and personal well-being.
This make Sparkit more attractive to current and prospective employees.
Benefits:
Solution: Improve the medical plan to cover 90% of costs, reducing the employee’s share to
10%.
Justification: Offering more comprehensive health benefits reduces employees’ financial
burden, increasing satisfaction and loyalty.
B2. Allocation of Funds
First Year ($4,000,000 Allocation)
Variable Pay:
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Increase annual bonus percentage: $1,500,000
Recognition:
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Implement recognition platform: $46,000
Well-being:
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Introduce paid parental leave and flexible work options: $533,654
Benefits:
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Improve medical plan coverage: $1,920,346
Total: $4,000,000
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Allocation for Second and Third Years
For the second and third years, the $4,000,000 budget each year will be allocated as follows:
Continuation of Funding:
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Continue funding the enhanced bonus, recognition platform, and well-being
initiatives.
Variable Pay:
•
Enhanced bonus: $1,500,000
Recognition:
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Recognition platform: $46,000
Well-being:
•
Paid parental leave and flexible work options: $533,654
Benefits:
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Medical plan coverage: $1,920,346
B3. Communications Plan
B3a. Initial Introduction
Announcement: Conduct a company-wide meeting (virtual or in-person) led by the
CEO to introduce the new total rewards plan. The meeting should emphasize the
enhancements and their alignment with Sparkit’s commitment to employee well-being.
Detailed Brief: Distribute a document that outline the details of the new plan,
including FAQs, via email and the company intranet.
B3b. Ongoing Communication Methods
Monthly Newsletters: Send out monthly newsletters highlighting different aspects of
the total rewards plan, success stories, and reminders about the benefits available.
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Workshops and Webinars: Host quarterly workshops and webinars to educate
employees on how to maximize their benefits and understand new enhancements.
Feedback Mechanism: Implement a feedback system where employees can provide
ongoing input on the rewards plan. This ensure continuous improvement and address any
concerns promptly.
References
Bussin, M. H., Pregnolato, M., & Schlechter, A. F. (2017). Total rewards that retain: A study
of demographic preferences. SA Journal of Human Resource Management, 15(1), 110.
Day, N. E. (2016). Compensation: Total Rewards Programs in Nonprofit Organizations. The
Jossey‐Bass Handbook of Nonprofit Leadership and Management, 639-687.
Ducie, Y. (2019). The Evolution and Future of Total Rewards as a Remuneration Strategy.
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Fulmer, I. S., & Li, J. (2022). Compensation, benefits, and total rewards: A bird’s-eye (re)
view. Annual Review of Organizational Psychology and Organizational Behavior, 9,
147-169.
Khorrami, H., Arasteh, H., Navehebrahim, A., & Abdollahi, B. (2019). Identifying total
rewards from the perspective of knowledge workers, with emphasis on learning and
development strategies. Iranian journal of educational sociology, 2(2), 154-162.